David Sholtis joined Bosch in August after 13 years with Honeywell International. He joined Bosch as vice president of the company’s new Filtration Americas Regional Business Unit, where he has full responsibility for the filtration business in both North America and Latin America, including strategy formulation, support coordination and coordination of the Bosch Group and MANN+HUMMEL joint venture – Purolator Filters NA LLC. 
In this exclusive interview, Sholtis talks about the formation of the new Filtration Americas business, and the division’s role in the filtration segment.
What does the establishment of Filtration Americas mean to the aftermarket? Where does Purolator fit in the picture? What is Purolator’s relationship with Bosch?
Bosch has identified filtration as an attractive long-term growth segment. To ensure a high level of focus on this segment, Bosch recently established the Filtration Americas Regional Business Unit. This will allow us to utilize our synergies to not only grow this segment of the business but also to communicate to our current and future customers that Bosch is committed to filtration and sees it as core to its business. In fact, Bosch has already demonstrated its commitment through the joint venture agreement with Mann+Hummel on Purolator being the North American source for high quality filter manufacturing.
As you know, Bosch and Mann+Hummel acquired Purolator Filters NA LLC in April 2006 in a joint venture agreement. As part of the agreement, Bosch has assumed responsibility for the aftermarket sales and marketing of the Purolator brands in NAFTA. Purolator is contributing manufacturing and engineering capabilities and is a key asset in our filtration strategy.
As a result of this acquisition, Purolator now has access to the global resources of Bosch and Mann+Hummel, both of whom are committed to investing in and growing the filter business. This will mean increased benefits to the customer through world-class customer service, innovation and new products.
Why did Bosch feel this was the right time to establish the Filtration Americas Regional Business Unit?
With the addition of the Purolator JV Bosch wanted to ensure that focus was put upon the filtration business to achieve lasting growth and enhanced customer value. We also viewed this as an opportunity to demonstrate to our customers the resolve we have to ensure that we are meeting their needs with the very best customer service and products. Overall, we want to make sure that we deliver flawlessly our unique value proposition that helps our customers be successful.
What are Purolator’s strengths in the marketplace? What is the brand image/message?
Product innovation has been a major strength for Purolator in the marketplace since the very beginning. In 1923, Purolator invented the first automotive oil filter and in 1955, the ‘spin-on’ oil filter. In fact, the first automotive filter was called a “Purolator” which is derived from Pure Oil Later. Subsequently, Purolator contributed a number of advancements to the development of filter technology in the areas of filtration media and ease of installation. Most recently, Purolator introduced grip control on its PureONE oil filter that makes installation and removal quick and trouble free.
Purolator products have an excellent reputation for quality, technology and customer service. In addition, we have the best order fill in the industry and are known and trusted by DIYers and installers nationwide.
Both Bosch and Purolator are both highly respected brands, covering all makes and models but appealing to very different segments of the population. While the Purolator brand is attractive to the consumer looking for quality and value backed by outstanding technology, the Bosch brand appeals to the brand conscious, discriminating buyer looking for a higher level of performance. As a result, through these brands, we are able to provide our customers the unique ability to offer their customers the brand that best fits their needs. This allows our customers to better segment their customer base and increase store traffic.
The Purolator brand includes more than 2,000 part numbers for automotive, light truck and heavy-duty applications. Ford, DaimlerChrysler, plus Mazda and Navistar, have all given quality awards to Purolator. In addition, Purolator Filters’ NA manufacturing plant is "TS-16949" and "ISO 14001" registered.
Where is filter technology headed?
Engine technology is changing rapidly and demands filters that can allow the oil to rapidly pass while trapping and holding smaller particles. This means that the filter must have a high efficiency rating and high capacity, two features that sometimes go against each other. There is also a good bit of work being done around nano fibers in the advanced engine labs to support the required features. On the consumer side, we see the need for a filter that has grip control, so we added this feature to our PureOne product. We are also seeing a greening trend with auto manufacturers moving to cartridge filters, which eliminates the need for the steel “can” each time you purchase a filter
What is the current status of the filter market? Where do you see it going?
Today the filter market is contracting slightly due to the impact of higher gas prices, reduced miles driven and recent economic conditions. Thus consumers are delaying their oil changes. On the positive side, we are seeing a shift in buyer preference for the premium segment of filters. We are also seeing more consumers changing their air filters to try and improve their gas mileage. Near term, we see consumers holding onto their cars longer and looking for ways to extend their life and, as you know, one of the best ways to do that is to change your oil and filter regularly
What areas, in your opinion, have the greatest growth potential and what areas pose the greatest challenges?
The growing premium segment represents a great opportunity. I also think there is an opportunity for us to educate the consumer about the value that a filter provides and why it is important to change your filters regularly.
Specifically, cabin air filters represent excellent growth potential. The driving public is extremely receptive to the idea of breathing clean air. Plus, a growing awareness of air quality as it relates to asthma and allergies makes cabin air filters very desirable. At present though, much of the public is not aware that their cars even have one! It’s the job of our marketers to get this message out and educate the public.
The greatest challenges we face today are high gas prices and the decline in miles driven leading to longer change intervals. Besides, filters from low-cost regions and a general lack of knowledge about the value of filtration also pose a challenge.
Then, there are the “forgotten filters” such as transmission filters, fuel filters, PCV valves and breathers; few consumers know about them.
How are you preparing to support and ‘exploit’ the growth potential in NAFTA markets?
We will continue to invest in new products and innovation, and as I mentioned, we have applied this thinking to PureOne. We will also work to get the message out about the benefits of filtration and the reasons it’s important to change your filters regularly with a high quality branded filter like Purolator or Bosch.
How do you propose to deal with the challenges?
We plan to deal with our challenges through our strengths in research and development, our focus on producing reliable and long-lasting products, creating consumer awareness of the “forgotten filters” and keeping our fingers on the pulse of the needs of the marketplace so we can respond quickly.
The fact is, we see the car park growing long-term and while there’s not much we can do to increase miles driven, we can surely educate consumers about the importance of changing the oil and filter and if they are going to wait longer between changes then they should consider purchasing a premium filter
