The Specialty Equipment Market Association (SEMA) is a trade association for manufacturers of accessories and equipment — including tires and wheels — for the motorsports and car collector industries. Among its activities is the annual SEMA Show in Las Vegas. A team of SEMA staff members told Tire Business in our mid-year questionnaire that the organization wants to continue to put on the "best" show, as opposed to the biggest.
Q: With the year nearing its halfway point, how would you describe the state of the association in 2018?
A: The industry is strong. All economic indicators are trending positively, and we're seeing increased involvement with many SEMA programs. From the SEMA Show and the recent SEMA Washington Rally, to our councils, and network participation and activity in our SEMA Garage, we know that the industry is healthy and engaged.
Q: What are some of the pleasant surprises you are seeing for SEMA and/or its members? What has surprised you most?
A: We're pleasantly surprised that members are actively involved. Participation in events like our town hall meetings, the Washington rally and even the SEMA Board of Directors election is on the rise. The more engaged the industry is, and the more input we have from members, the better we are able to assist and serve the industry.
Q: Where do you see industry markets going in the second half of 2018?
A: With the economy going well, our industry continues to see growth. In a recent study SEMA conducted, more than 80 percent of industry manufacturers polled expected their businesses to grow in 2018.
Q: What trends are you seeing in the marketplace? How are you and/or your members reacting to them?
A: Some key trends include the changes in vehicle demand/production, such as the shift to more truck and SUV/CUV sales, and ongoing changes in vehicle technology. Advances in business technology, retail channels and a new generation of consumers are also key drivers of change and possible growth.
Q: What sectors look strong? Are they sustainable in the future?
A: The truck sector has been strong for the last few years, fueled by new vehicle sales growth and a shift away from traditional passenger cars. Performance and sports cars are another hot spot for the industry as consumers are looking for a more fun driving experience. Additionally, the advanced driver assist market is a trend we can expect to see more of in the future.
Q: What sectors are struggling? Do you expect them to rebound? If so, how soon, and if not, why not?
A: A struggling spot would be traditional mobile electronics, as OEMs have done a good job of including higher-end audio options from the factory.
Q: How, if at all, is the threat of tariffs affecting your members?
A: SEMA members have felt the impact of tariffs, as the market reacted before they were implemented. This has led to price increases in some sectors and presents an ongoing challenge for many SEMA members.
Q: Do you foresee any price hikes in the second half of 2018?
A: It's difficult to speculate, but our team is prepared to respond and assist the industry, regardless of the direction the economy goes.
Q: What are the challenges the industry is facing?
A: Our challenge is a growing workforce. Companies are expanding and seeking quality employees. SEMA is actively helping through promoting its robust career board. Getting younger people interested in the automotive industry who will purchase products in the future also is on the minds of many SEMA members.
Q: How have the tax cuts affected your members? In particular, are customers buying more because of it?
A: On the consumer side, anything that puts more money in their pockets will be positive for the industry, but the effect only will be a portion of what consumers ultimately feel is their personal gain from the policy.
Q: Do you think any of your members are planning any major investments in the next six months?
A: It's difficult to say what members will be doing, but we're prepared to respond accordingly either way.
Q: What do you expect from the SEMA Show this year? Do you expect sizable growth, or pretty much the same as last year?
A: First and foremost, our primary goal is to produce the best trade show, not the biggest. This is best represented in the space cap policy that is in effect this year, which limits exhibitors from increasing the size of their booths; heightened scrutiny of exhibitor applications (which resulted in 600 denied applications); and other initiatives to heighten the value of the show to our industry.
Q: Would you say SEMA is focusing more on government relations, and what do you hope to accomplish in that area this year?
A: Our key initiative is the RPM (Recognizing the Protection of Motorsports) Act, which will protect Americans who modify street vehicles into dedicated race cars and industry's right to sell the parts that enable races to compete. The RPM Act now has 148 co-sponsors in the House and 38 co-sponsors in the Senate, and the number continues to grow.