Why did Plews & Edelmann decide to purchase Blissfield Manufacturing Co.?
At Plews & Edelmann, we are constantly looking for inorganic ways to grow our steering portfolio beyond our base business. We met Blissfield’s owner, Pat Farver, through an OE contact and began a discussion that led to the purchase. We were very appreciative for the confidence that our OE friends had in us because the addition of the Blissfield cooler business fits our vision for aftermarket steering component growth perfectly.
Why does Plews & Edelmann see an opportunity in manufacturing coolers?
First, let me say that Plews & Edelmann will be manufacturing its coolers in the U.S., which is a huge advantage to our customers. We don’t have supply chain concerns and we can control our quality because we are using OE spec technology. To the best of our knowledge, no aftermarket supplier can make this claim.
Second, there are no full line providers for this product line, but we hope to change that. There are hundreds of unique SKUs of varying designs out there that have been manufactured for OEs over the past few decades and most aftermarket providers have sacrificed the OE design for their own convenience leaving the consumer to use something that was not originally designed to cool their steering fluid.
Tell us a little bit more about the cooler market today – how big is the market, are OE coolers still produced today, and why are they essential?
The cooler market is bigger than most people think and definitely larger than we originally thought. It’s taken a lot of diligence to truly assess the size of the North American market. Although we like to keep that intelligence confidential, I can say that, globally, we see a market for coolers that potentially exceeds 250 million vehicles.
Additionally, coolers are still being produced at the OE level because there are still several platforms in production that require coolers. Power steering coolers are an essential component for vehicles that need to reduce the temperature of the power steering fluid. With hotter running engines, the cooler design is integral in maintaining a long life of steering components like hoses, rack and pinions, pumps, and gears. Without the cooler, the power steering system runs the extreme risk of cooking the fluid and potentially damaging all steering components, which will result in a significant repair bill for the customer.
What is the normal repair or replacement rate for coolers?
Surprisingly, the replacement rate for coolers is greater than normal wear and tear items in some cases. A big factor involves metallurgy. Coolers made from steel are subject to rust. While newer designs use aluminum to avoid rust, they are less resistant to potential damage due to their location in the vehicle. To function properly, coolers often require “first air,” which means they are placed near the front of the vehicle and many times right behind the front grill. Although this enhances the cooling properties, it also increases the risk of stones and debris piercing the aluminum frame or tube.
How will Plews & Edelmann coolers be marketed?
The coolers will be added to our full line of power steering products under the Edelmann Elite brand. As we continue to develop the Total Solution brand for power steering, the addition of coolers helps to enhance its positioning. We take pride in our stringent quality and recognize the need to provide aftermarket technicians with a product that delivers OE form, fit and function. This is a great opportunity to win the market over with high quality, U.S. made products that meet OE design specification. Our product will be best in class and provide a full breadth of vehicle coverage.
Why did you decide on manufacturing in the U.S. as opposed to another LCC?
We chose the U.S. for several reasons. First, we wanted to remain close to the core of Blissfield legacy employees and suppliers who can contribute to making the program work. Their product knowledge and technical expertise has been inspirational and immensely helpful.
Second, we wanted to also utilize our local team in Dixon, Illinois. Coolers are subject to some very demanding engineering, manufacturing and quality requirements, and we felt that our team in Dixon was best suited to take on this project. In addition, it’s created several opportunities for additional team members to grow and improve themselves professionally. Third, we are proud of the Blissfield company’s American heritage and want to continue that commitment to the aftermarket for as long as we are able.
Do you have any global aspirations for the program?
Yes! We’ve had conversations with several European customers about our ability to manufacture an OE like product using OE equipment. In many cases there isn’t an aftermarket alternative to OE. If there is any interest in the category, we would welcome a conversation with any potential customer regardless of their location.
What kinds of opportunities does this acquisition bring in terms of the EV market?
Power steering coolers offer cooling applications to hydraulic and some hybrid vehicles and cooler technology is transferrable to many EV applications. One recent EV battery release noted the use of cooler lines for improved battery temperature and longer life.
What is the long-term vision for Plews & Edelmann with the intention of making more acquisitions?
We’re bullish on the M&A side of the market, and we are always on the lookout for complementary fits with our organization. You will soon hear of another acquisition currently in the works. If there are any manufacturers in the steering space that would like to talk, we welcome them reaching out to us.
How has the company adjusted to and prepared for the prolonged global supply chain issues we are seeing today? What are your overall thoughts on the state of the industry for the remainder of 2022?
Plews & Edelmann has been blessed to manufacture in North America. In 2021, our corporate order fill averaged well over 95%. We embrace the supply chain disruption and believe it to be a huge advantage for a U.S.-based company. In our opinion, there will continue to be supply chain disruptions well into 2023. Whether the main contributors are American-Chinese relations or threats of war, the automotive aftermarket will be required to pivot as suppliers face various headwinds in 2022.
How important is Vehicle Miles Traveled as an aftermarket indicator for Plews & Edelmann?
Like most suppliers whose “sweet spot” is a vehicle ranging in age from 8-15 years, an increase in miles driven also helps expand the need for steering component repairs. We saw an uptick in 2021 as more personal vehicles were being used for longer trips and vacations in lieu of air travel. While much of our product offering is considered a non-discretionary spend, an increase in vehicle repairs due to more miles driven helps our cause. And due to our close proximity to our customers in North America, any change in their demand can be overcome quickly with exemplary order fill from a stateside supplier-partner.