In part one of this multi-part series, aftermarketNews sits down with Richard "Dick" Morgan, a 48-year veteran of the automotive aftermarket industry who on Dec. 31, 2009, celebrated his retirement from the position of president and CEO of Aftermarket Auto Parts Alliance, a position he held for the past 16 years. In this exclusive interview, Morgan reflects back on the accomplishments he’s most proud of, the changes he has seen in the nearly half a century that he’s been in the industry and what he hopes and expects of the future.

Looking back at your exceptional career, what are you most proud of?

Being part of the successful creation of Aftermarket Auto Parts Alliance upon the merger of AutoValue and AllPro/Bumper to Bumper in 2000. And also, the fact that I really had three separate careers in this industry. I spent 21 ½ years with General Motors – all on the parts side of the business; I started out with AC Spark Plug in ’62, which became ACDelco in ’75. I left Europe as director of sales and marketing for ACDelco Europe, Africa and the Middle East in 1983 and went to Straus Frank Co., the large CARQUEST distributor in Texas and was there 13 years. Then I joined AutoValue, which as I mentioned later became the Alliance. And, I’ve been with the Alliance now about 16 years so far. The fact that I enjoyed all three jobs as much as I did is probably the thing I’m most proud of.

The first two jobs – one with a manufacturer and one with a distributor – prepared me to do this job, where as the head of a program group I’m trying to put the two together and make them both happy, and both successful. These past 16 years have felt like two or three years. I have really enjoyed working with the shareholders in the Alliance and the vendors. It’s been a very enjoyable career. Not too many people can say they always enjoyed getting up every day and going to work, but I have in everything I’ve done in the automotive aftermarket.

What are your hopes for the Alliance – and the aftermarket as a whole – in the coming years?

My main hope for the Alliance is that the shareholders can have continued growth and success. They’ve done very well, and it’s a great group of guys. Not everyone has grown the way that most of the shareholders of the Alliance have, and my hopes are that they can continue to do so. I think they will.

For the aftermarket as a whole, I would hope that the traditional distributor – the group that I represent – will remain a vital step in the distribution chain. Manufacturers need to remember that they need to stick by the people who brought them to the dance and keep the traditional WDs and jobbers on a level playing field with the retail customers. That’s what I hope for the aftermarket. I hope traditional distribution can continue to grow and have success. That’s not to say that the retailers aren’t going to continue to grow also. I just hope that the manufacturers continue to keep in mind who brought them to the party and who helped develop the brand(s) and keep them competitive. Have no doubt, the traditional guy is the savvy guy on the street, and that’s one thing the retailers haven’t learned yet – how to properly take care of the professional installer customer. That’s why there is still a need for the traditional aftermarket guys.

Do you think that since the retailers are such a big player and have so much focus that they’re able to exert more influence and put manufacturers in that position?

The larger you are, the more attractive you are for someone to want to do business with you. It’s not just the fact that they can demand more, they can also do things because of the volume of scale. When someone can give you five truckloads to ship at your convenience, that’s worth something. That’s the ability to leverage your power. But the traditional guys have always managed to, in my opinion, out-perform pure retailers at the street level, to execute better and that’s who will survive – the guy who executes properly.

What were, in your opinion, some of the most significant influences to impact aftermarket parts distribution in the past decade? Were there any major changes that surprised you?

Going back 10 years, one of the biggest impacts was the OE car manufacturer making a stronger run for the aftermarket business. It got harder and harder as the automobile new car dealers from all over the U.S. began gobbling up market share. The automobile manufacturers had to figure out a way for the dealers to make a profit, and the way they went after the installer business so strongly was a definite influence in the early part of the past decade.

Of course, the retailers then going after the installer business was also a very significant influence to impact the distribution chain. One major change — the single most strategic move I’ve seen in my entire career was General Parts buying Worldpac. It surprised me, but it shouldn’t have. That to me, was the single most strategic move that I saw happen in my entire career. It was and is a big deal. It was a masterful thing to be able to pull off something like that.

I started my career with General Motors in 1962, and I believe we had 57 percent of the market share of all of the cars sold in the United States at that time. You can imagine the kind of influence you had in the aftermarket as a result. And now GM has about 17 to 19 percent, which shows that the market for OE import parts for the installer has just gotten bigger and bigger.

Those are the major changes that I saw and most of them didn’t surprise me. I go way back to when the retailers really starting hitting it hard across the country – I’m going back now to the mid-80s – it was just unbelievable. It was a complete paradigm shift in the way auto parts were sold, from the way the traditional WD, jobber and dealer had gone to market and all of a sudden these guys, the “grocery people,” showed up. A lot of people didn’t even know they were in business (in some areas) until it was too late.

Do you think the import nameplates are going to continue to dominate?

Yes, there’s no doubt about that. You can forget about the term "foreign car" any more and just talk about automobiles. An automobile is an automobile – where it’s made doesn’t have much to do with it anymore. Take this new car from India, the Tata, for example. I think it will start hitting here in the U.S., and the Chinese will get it right one of these days too – as long as the currency is favorable to them and as long as the U.S. government doesn’t do anything to try to keep us on a level playing field.

You mentioned the OEMs making a run for the aftermarket …

That is not as strong now with the car dealerships, but it is my belief the OE car manufacturer will bypass the car dealer and go after the parts business. Look at our trade journals — they are full of ads offering OE parts direct from the manufacturer to the installer and to the public.

Click on the links to read Part Two and Part Three.