Automotive Parts Rebuilders Association
April 8, 1999
Mr. Robert C. Grieser
Manager
Planning, Research and Activation
320 First Street, NW
Washington, D.C. 20534
RE: Generators and Alternators Stud
Dear Mr. Grieser:
I am president of the Automotive Parts Rebuilders Association. APRA is the trade association of those companies which rebuild used motor vehicle parts for reuse and resale. The association has almost 2,000 members worldwide. Among the items rebuilt by APRA's members are generators, alternators, starters and stators.
We have recently become aware of the study FPI is doing on the feasibility of manufacturing new generators, alternators, starters and stators. APRA strongly opposes
FPI's entry into this field because it could have a significant impact on the small companies which rebuild those products.
Rebuilt electrical products compete with new products in many applications, especially for older vehicles. Any sizable dislocation of the market, such as withdrawing up to 25% of the Federal market from competitive procurement, will cause sizable reverberations among the remainder of the market. Units which would otherwise have been sold to the government, especially by the larger corporations, will surface in the commercial market at a price designed to ensure a quick sale. These sales will put severe downward pressure on overall market prices the impact of which will fall hardest on the small manufacturers and the rebuilders who have less of an ability to absorb price decreases. The effect of this will be loss of market share by the small companies to the larger ones and will inevitably force some of them out of business.
We urge you to reconsider this idea and to decide against entering this market.
Very truly yours,
William C. Gager
4401 Fair Lakes Court, Suite 210, Fairfax, Virginia 22033
Phone: (703) 968-2772 FAX- 703-968-2878