On the changing business model for Motorcraft-branded parts
We are emphasizing three areas. First, there’s too much complexity — there are too many part numbers. Second, we need much better coverage for older cars. And third, we need to be much more price-competitive for older models.
On reducing parts complexity
If you look at our entire shocks lineup, we’ve reduced our part numbers by about 32 percent, or about 400 numbers for dealers. That allows them to reduce their inventory cost and reduce what they have to carry. It also makes it much easier for the technician and parts manager to look up those parts. They’ve got less to spend time on, so now dealers can spend time on those older models.
How does this strategy help dealers save money?
If you look at shocks, for the average dealer it reduces inventory costs by about $20,000. And that’s just one product line. We are doing that across the board.
How do you reduce parts numbers but increase coverage for more models?
We’ve redesigned the product to have less overlap. We’ve gone back to the manufacturer and asked: “How can we get more coverage with the same part?” On the oxygen sensor, we’ve changed the connector to give more plug-and-play applications across more Ford and Lincoln vehicles.
On filling dealers’ orders quickly when they stock fewer parts
We have a 98 percent fill rate from our depots. If a dealer puts an order in today, he will have the part the next day about 90 percent of the time. We are not going to ask them to stock that part. We’ll take on that burden.
Is Motorcraft still pursuing a “good-better-best” tiered parts strategy?
You don’t want to diminish the brand. We are taking it to an [original equipment] spec or close to that, but not too far below that. We are stopping at the better spec.
How will Motorcraft’s better line of parts compare with what consumers can buy at auto parts stores?
With the very high-quality replacement line of parts, it will be equal to or better than what you will get from a NAPA or O’Reilly [store], and have our warranty and brand. We’ve realigned our pricing to allow us to go head to head with the strong aftermarket brands.