Indiana remanufacturer Jasper expanding, retooling area plant

2016 is starting off as a year of expansion for an Indiana auto parts remanufacturer to make a bigger sales splash in southwest Missouri.

Jasper Engines & Transmissions is expanding its Willow Springs plant where the company produces gasoline engines and transmissions for Chevrolet and General Motors vehicles. The company counts at least 20 auto repair shops in the Springfield area as customers served from a Kansas City sales branch – one of 43 nationwide.

The $2.5 million project started in October and should be complete in February, officials with the Jasper, Ind.-based company said. Jasper’s two additional areas totaling 30,000 square feet will allow the company to reconfigure its warehouse space, add manufacturing cells and increase production volume in Willow Springs. A combination remanufacturing-distribution center in Crawford County, Ind., is next in line for a face-lift.

According to Jasper Advertising Manager Mike Pfau, the companywide overhauls are intended to take advantage of record sales in 2011, 2013 and 2014 – when sales jumped 14.5 percent to a new high of $386.1 million.

“We’ve seen what revamping our plant can do as far as product flow and improving efficiencies; it accommodates our growth,” Pfau said, adding the company expects to increase sales by at least 10 percent in 2016.

Upward track
Jasper’s moves are taking place alongside an upward trend in Missouri’s automotive industry.

According to the state Department of Economic Development, since 2010 over 60 auto companies added more than 4,800 jobs and invested roughly $745 million in capital. The DED also reports employment at vehicle assembly plants for Ford Motor Co. in Kansas City and General Motors Co. in Wentzville doubled in that time. A report released Jan. 5 by industry research firm AutoData shows new car sales nationwide reached a new high of 17.47 million vehicles sold in 2015.

Despite increased productivity of new vehicles, local mechanic shops report some customers are holding on to older models longer, which is good news for remanufacturers.

“Car manufacturers have almost priced a new vehicle out of most people’s pockets,” said Rick’s Automotive Executive Vice President Tim Cummings.

He added the roughly $5,000 price tag for a remanufactured engine comes with a three-year, 100,000-mile transferrable parts and labor warranty when purchased from Jasper – something unheard of for brand new vehicles.

Pfau said the upward trend in Jasper’s sales indicates owners are more likely to reinvest in fixing the car they already have as opposed to buying a newer model.

“We came out of this nasty recession where people saw the need to watch how they spent their money and that goes hand-in-hand with doing necessary repairs and maintenance,” Pfau said. “There’s certainly been a sweet spot for remanufactured products – years when you start to see the failure of drivetrain components and the need peaking.”

Cummings, who along with Rick’s owner and president Rick Hughlett previously served on Jasper’s customer advisory board, said the remanufacturer’s fill rate for shop orders is currently 90-95 percent. Minus the occasional part ordered from an original equipment manufacturer, the expansion could help fill in some of the gap.

“I think for them, increasing business is branching out more,” Cummings said. “With building Willow Springs up, it allows them to get out more product.”

Leading edge
Roughly 18 months ago, Jasper purchased additional space and reorganized two remanufacturing facilities at its Indiana headquarters. Pfau said the blank slate allowed the company to make more efficient use of space by building wider aisles for conveying product through the plant and expanding manufacturing cells, aka pods, devoted to specific brands and products, including engines for boats and Ford trucks.

While the Willow Springs facility is due for similar changes, Pfau said it’s part of a companywide initiative to capitalize on gains rather than a grab for the area’s market from a rival like SRC Automotive.

“It’s hard to say it’s going to have a direct impact on people specifically in Missouri,” Pfau said. “It’s improving our efficiency and allowing us to increase capacity, which, ideally, should benefit all of our customers.”

For local customers such as KVLA LLC Operations Manager Dustin Atwood, who toured Jasper’s Indiana facilities after renovations, the addition of pods dedicated to quality control and product testing would only help Jasper continue charting annual growth.

“If they’re branching that [process] out to Willow Springs, that’s going to be a great benefit,” said Atwood, who represents Seeburg Muffler and Brake and A-1 Custom Muffler and Brake. “Since they opened that hub, there’s a lot of times I will have something by the next day, and I don’t have that kind of service from anyone else.”

Rick’s and another South Campbell Avenue automotive shop, Best Discount Mufflers & Brakes, are among the top buyers in Springfield’s market for Jasper parts, each spending at least $25,000 per year. Neither Rick’s Automotive nor Best Discount uses SRC despite being located in the same city.

“I’m not saying SRC isn’t good enough, but I don’t have that guarantee from SRC,” said Best Discount Manager Tyler Bettinger, referencing Jasper’s warranty. “The way I look at it is if we get what we need in a timely fashion, I don’t care where it’s coming from.”