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(Photos by WILLIAM ARCHIE/Detroit Free Press)
Greg Henderson, 29, of Lennon works on a Jeep Wrangler being customized into a Brute on Aug. 21 at American Expedition Vehicles.
The need for speed works to the advantage of metro Detroit vehicle customizers
September 5, 2007
There are huge boxes -- about the size of two dishwashers -- landing on doorsteps, at auto garages and dealerships across the country.
Inside are all the parts you would need to turn a Jeep Wrangler into a pickup, known as a Brute.hose boxes, which sell for about $9,000 each, come from the Walled Lake garage of American Expedition Vehicles, which soups up Jeeps for off-roading and assembles kits for do-it-yourselfers to customize their own vehicles.
Most of the parts come from Michigan.
In contrast to declines in most of the state's auto industry, American Expedition Vehicles, which has grown from five to 30 employees in the last year, moved its headquarters from Montana to Michigan.
"We can source any part within a 45-minute drive of this building," said Michael Chetcuti, a new owner of American Expedition Vehicles.
His metal stamping business -- Quality Metalcraft Inc. in Livonia -- bought the Jeep customizer last year.
Chetcuti, 43, grew up in Southfield. He plans to buy five more companies in as many years as part of a strategy to grab hold of a growing and quickly changing market for customized cars and low-volume automotive accessories.
The U.S. market for accessories added after a vehicle has rolled off the assembly line is nearly $37 billion and growing at about 7% a year, according to the Specialty Equipment Manufacturers Association.
"We're really at a threshold right now," said Peter MacGillivray, vice president of communications and events for the association. "Consumers have bought into the notion that they are what they drive and their vehicles are a reflection of their personalities."
Quality Metalcraft, with about 270 employees, makes metal low-volume production and concept vehicles. The company, founded by Chetcuti's father 43 years ago, made prototype minivan bodies for Chrysler LLC.
Sales at Quality Metalcraft have been flat this year. The stamping business can be unpredictable because automakers can easily change plans on concept and specialty vehicles.
American Expedition Vehicles, on the other hand, has seen strong growth. Chetcuti wouldn't reveal any sales or volume numbers, but said the company booked more business in the first three months of this year than it did in all of 2006.
Chetcuti says that metro Detroit, with its automotive expertise and extra capacity, is ideal to serve a growing demand for accessories -- and is better than low-cost countries like China and India where parts makers have shifted their manufacturing of high-volume parts.
"For extremely trendy aftermarket parts and accessories, because of the volume -- the volumes are low -- there is no better place in the world to do it than Detroit," he said.
That's because in fast-changing niche markets, suppliers don't have time to wait for shipments from other countries.
Typically, automakers take in about 10 weeks of inventory from suppliers in low-cost countries so there's enough time to ship more over.
Some trends don't have 10 weeks.
"By the time we worked all that out, we would have probably missed the market and a competitor would have swept in and grabbed the business ... and then you've got to be off to the next thing," Chetcuti said. The need for speed works to the advantage of metro Detroit.
"When you get into a very niche product with high visibility and a high profile, people are willing to pay a little more for the product," Chetcuti said. That offers the revenue to pay for higher labor costs in Michigan.
Timing will become all the more important for American Expedition Vehicles as it tries to catch the eye of trendsetters.
Chetcuti said, "We'd like to have a Paris Hilton effect and get beyond the rock-crawling market."
The low-volume business model can be a profitable one, but it won't work for every auto-parts maker, said David Andrea, vice president of business development for the Original Equipment Suppliers Association.
"The core market will still remain high-volume production for the mass market," he said.
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