Auto-parts industry revs up here
Addition of big Pep Boys, expansion of Als Auto will add to competitive market
Chad CainDecember 10th, 1998
The race among auto-parts retailers here for the do-it-yourselfers dollar is intensifying, but whether the market is headed for a shakeout still is unclear.
Early next year, The Pep BoysManny, Moe & Jack, a big, Philadelphia-based auto-parts and service chain, plans to open the first of three supercenters it has slated for the Spokane-Coeur dAlene market.
Meanwhile, other chains that already have a presence here also are expanding. Als Auto Supply, which first entered the Spokane market about 10 years ago, has opened three new stores here in the last year, and may open one or two additional outlets soon, a company official says.
Napa Auto Parts, which with 13 stores here has the biggest presence in the Spokane market, is in the middle of a long-range plan that calls for expanding all of its Spokane-area stores to accommodate growth and increase warehouse space. In many cases, that strategy will involve replacing smaller stores with larger ones nearby. However, Napa, which is owned by Atlanta-based Genuine Parts Co., has no immediate plans to increase the number of stores it operates here.
Industry observers predict that the Spokane area will continue to see chains vie for prime locations to open stores. Among the possible newcomers is Auto Zone Inc., a big, Memphis, Tenn.-based company with more than 2,000 stores nationwide.
Not all industry experts agree that the Spokane area can sustain the pace of auto-chain growth it has experienced in recent years. The number of stores may have increased, but the amount of money customers are spending on auto parts hasnt seen a similar jump, says Larry Wiser, president of Parts Wholesale Inc., a Spokane company that does business here as Motion Auto Supply. Motion Auto opened a store in Airway Heights last year, boosting to four the number of outlets it operates here. The company has no plans to expand in the foreseeable future, he says.
The do-it-yourself market is not growing; its really kind of flat nationally, Wiser says. Thats because many of the cars that are built today dont need as many repairs as vehicles did in the past. Even when they do need repairs, the newer vehicles sometimes have problems with complicated electronic components, which weekend mechanics have trouble diagnosing, he says.
Wiser says that the number of auto-parts stores nationwide has shrunk considerably in recent years, thanks to consolidations and mergers between companies. That trend hasnt hit Spokane yet, but he says it likely will in the future. When it does, the companies that survive will have strong customer service, a solid business plan, and strong buying power.
Wiser adds that while the number of chains here has expanded, the smaller, independently owned auto-parts stores have all but disappeared.
Other industry experts agree that as the competition continues to rev up here, a shakeout could be possible. However, many of the chains here say theyll be able to compete and survive.
We have confidence that our approach is better than the competitions, says Lisa DeVoe, marketing coordinator for CSK Auto Inc., a Phoenix-based company that operates eight Shucks Auto Supply stores in Spokane and one in Coeur dAlene. CSK Auto runs a total of 760 stores in 12 states under the Shucks, Checker Auto Parts, and Kragen Auto Parts names.
Denny Justus, Napas district manager here, is surprised by the amount of growth that has taken place in the industry in the Spokane area recently. He says that after Pep Boys opens its stores, the market likely will feel a pinch. He adds, however, that well be able to compete.
Despite the proliferation of stores here, other industry representatives contend theres sufficient demand to support the increase so far.
I believe theres enough growth for all of us. As a whole, Spokane is a good growth area, says Lori Stutsman, vice president of marketing at Paccar Automotive Inc., a Renton, Wash.-based company that operates more than 170 auto-parts stores in six Western states, including the eight Als Auto Supply stores in the Spokane-Coeur dAlene area.
Paccar, some of whose stores carry the Grand Auto Supply name, is in the middle of a rapid expansion that calls for the addition of more than 70 new stores companywide next year. Stutsman says that many of those stores are being targeted at smaller communities, such as Deer Park and Chewelah. The company last month opened a new store in Colville, Wash., north of Spokane.
Stutsman and other industry experts cite several factors that have contributed to the industrys recent growth here, including a steady increase in population, a jump in the number of vehicles on the road, and an expansion in the services auto-parts chains offer. Among those services are commercial delivery, special orders for hard-to-find parts, and an increase in accessories made for light trucks and sport-utility vehicles.
The Spokane area also is an attractive market because many people here choose to work on their own vehicles, either out of financial necessity or because they enjoy it, observers say.
The largest splash, and the one thats expected to send ripples throughout the auto-parts industry here, will occur early next year when Pep Boys, which operates more than 630 stores nationwide, opens its supercenter store, at 12710 E. Sprague.
The company has secured a site in Coeur dAlene near the northwest corner of U.S. 95 and Canfield Avenue for another store, and is looking for a site on Spokanes North Side for yet one more.
Pep Boys claims to be the only retail and service chain in the nation thats capable of serving all four segmentsthe do-it-yourself, do-it-for-me, buy-for-resale, and tiresof the automotive market. A typical Pep Boys supercenter averages about 18,500 square feet of floor space, and is about twice the size of a conventional auto-parts store.
Bill Furtkevic, spokesman for the chain, says that in addition to selling auto parts to retail customers, each Pep Boys supercenter also operates a commercial delivery service for professional mechanics, sells all types of consumer tires, and offers automobile repair and maintenance services.
The companys new store on Sprague will have 12 repair bays where it will install parts sold by the stores attached retail department.
Furtkevic says that the repair department offers most of the services that professional mechanics shops and auto dealers offer, including oil changes; brake, steering, and suspension work; and glass and upholstery repair.
The repair and maintenance concept has worked well for the company across the county, and is the fastest-growing segment of the auto industry market, Furtkevic contends.
Still, many auto-parts chains are hesitant to get into the repair business. Napa, for instance, has no plans to expand into repairs, simply because it doesnt want to be in direct competition with professional mechanics, who make up the bulk of its customers, says Justus.
Stutsman, of Als Auto Supply, says that company already offers repair services at many of its stores in California, and also repairs vehicles at its Coeur dAlene store. While the company has no immediate plans to add repair services to its Spokane stores, the idea must be considered, she says.