DETROIT - Recaro, the German-based seat maker renowned for its specialty designs for sports cars and race cars, wants to bolster its business with the Big 3.
But Recaro has no intention of trying to challenge seating leaders Johnson Controls Inc., Lear Corp. or Magna International Inc.
Instead, it would like to work with them as partners to persuade the Big 3 to make Recaro-branded seats available as factory-installed options, said Hermann Weiss, director of sales and marketing for Recaro North America Inc.
In fact, Recaro needs companies like Lear to achieve its goals. 'We can't grow our business with the Big 3 alone,' said Klaus Fricke, CEO of Recaro North America. Fricke envisions having partners that would build seats from Recaro designs. 'We will never be a high-volume maker,' he said.
Recaro's parent company, Putsch GmbH & Co., recently sold Lear its Keiper Car Seating GmbH & Co. unit for $235 million. Keiper Car Seating was the just-in-time seat manufacturing and delivery unit that served several carmakers, including Mercedes-Benz. It also included a joint venture between Keiper and Lear-competitor Magna.
Recaro North America is a new subsidiary opened to increase both OEM and aftermarket business in the United States. Recaro sales in 1996 totaled about $156 million, and the company expects that to rise to $176 million this year.
Recaro's direct ties to the Big 3 are limited to a sole contract to supply front seats for police versions of the Chevrolet Lumina. But Recaro seats have long been standard equipment in Porsches, and are available as part of performance trim packages from automakers such as BMW, Volkswagen and Nissan.
Yet the company and its products have been relatively obscure in the U.S. market. Among auto enthusiasts, Recaro has about 40 percent name recognition, said Weiss. But among average consumers, that recognition drops to 10 percent. In contrast, Recaro enjoys 85 percent name recognition in Germany, and scores nearly as high in Japan, its No. 2 market, Weiss said.
BIG IN BUSES, TRUCKS
Recaro has had much greater success penetrating the commercial vehicle market in the United States. The company is the dominant seat maker in the bus market with a 65 percent share, said Fricke, and is also a prime supplier to Freightliner, Kenworth and Peterbilt.
Two factors help Recaro in the truck market, Weiss said:
Recaro's orthopedically designed seats are more comfortable for drivers who have to sit for long periods.
Most medium- and heavy-duty trucks are custom ordered, allowing the customer to specify Recaro seats rather than just taking a standard interior seat.
Fricke said Recaro wants to urge the Big 3 to emulate the custom-order process.
The health and safety benefits of its seats will become a prime focus of Recaro's pitch to automakers and the aftermarket, Weiss said.
Recaro plans to make a stronger push in the aftermarket. The company has about 150 dealers in the United States. Weiss wants to increase that to about 450 by year end.