Suppliers — no matter how successful — must ask themselves whether their core products could go the way of the buggy whip.
Gentex Corp. CEO Steve Downing asked himself that question in 2013. Gentex dominated the market for self-dimming rearview mirrors, but no supplier wants to depend on just one product.
So Gentex acquired Johnson Controls’ electronics unit — maker of the Homelink remote garage door opener — for $700 million.
Downing, who was named CFO of Gentex that year, led the negotiations. Homelink was the company’s first acquisition, and its first major product aside from rearview mirrors.
“We were really pushing the envelope,” Downing recalled, “but it allowed us to spread our wings and move into other areas of the vehicle.”
The deal worked out for Gentex, and Downing was named COO last August. After company founder Fred Bauer retired in January, Downing was elevated to CEO.
Downing is doing his best to prepare Gentex for a world where a vehicle’s cameras will have a 360-degree view of the road. Will mirrors become obsolete? Downing doesn’t think so, but he is hedging his bets.
Gentex is marketing rearview mirrors that can also display video images generated by rear-facing cameras. The motorist has a choice of using it as a traditional mirror or a video display.
The company has enjoyed some early successes. General Motors first adopted the hybrid mirror, followed by Toyota, Nissan, Subaru and Jaguar Land Rover.
This is heady stuff for Downing, who started his career as a number cruncher. After getting his bachelor’s degree in finance at Liberty University, Downing went to work for Hargrove Inc., a Maryland-based firm that designed trade show displays.
When the tech bubble burst, he moved to western Michigan in 2000 after Gentex posted an ad for a financial analyst.
Gentex enjoyed growing demand for its self-dimming mirrors, but the company did not have strong financial discipline. Downing helped improve accounting controls for pricing, contracts, forecasting and partnerships.
And when he was named CFO in 2013, the company began dismantling the organizational silos that isolated product development, engineering and finance.
Despite his bid to develop new products, Downing is mindful of the company’s roots. Gentex still gets much of its revenue from self-dimming mirrors, and it produces all of those mirrors in Zeeland, Mich.
And the lowly rearview mirror is getting a makeover as customer expectations rise. Motorists “look at our product as much as at a mobile device,” Downing noted. “They expect us to move along the [technology] curve.”
-- David Sedgwick