February 10, 2017

San Jose Mercury News: Staking a claim in the auto industry’s evolving technology

Read Dan’s interview with the San Jose Mercury News about the changes going on in the automotive industry and aftermarket: Staking a claim in the auto industry’s evolving technology
January 12, 2017

The Aftermarket Analyst, January 2017

A look back at some significant deals of 2016 The three trends Capstone Financial Group has identified as key to the auto aftermarket industry in the next year and beyond are: disintermediation, food chain acquisitions, and Detroit moving to Silicon Valley. We wrote about Silicon Valley in the last newsletter. To explain the other two trends, it helps to look back and review some key 2016 deals; specifically deals in the Jeep/4×4/Truck Accessory category. Key 2016 Jeep/4×4/Truck Accessories deals Nearly all of the above are examples of companies that not only have dealer networks, but sell their products online directly to the consumer. And importantly, all of the companies have similar multi-pronged sales strategies. This doesn’t necessarily portend the end of dealer networks or installers—although they have their own challenges to consider—it just means that manufacturers are taking advantage of the technology that wasn’t available to them 15 or 10 or 5 years ago. Online sales and marketing allows companies to expand their reach exponentially, and an educated consumer is a boon to the manufacturer and the dealer and installer network. Adapt or die. The companies listed in the table are all adapting. A Prime Example Bestop is a prime […]
October 25, 2016

The Aftermarket Analyst

Why Silicon Valley? Quick: What’s the first thing that comes to mind when somebody says “automotive aftermarket”? Is it struts and shocks and brakes? Lift kits and roll bars and “go-faster” parts? Or do you wring your hands and wonder what things like ride-sharing and autonomous vehicles will mean for the future? It’s a big, fast-moving world, so a proper perspective about what’s in store for all of us is in order. First things first Let’s get one thing out of the way: Americans still love their cars and trucks. The Federal Highway Administration estimated we drove our vehicles 3.148 trillion miles in 2015, besting the previous high of 3.003 trillion in 2007. The estimates for 2016 aren’t showing any slowdown. Combine that with data showing people are keeping vehicles longer than ever, and you have a recipe for strong aftermarket automotive growth. So if your focus is on the parts that break and need replacing, or even the performance parts business, you’re golden. Right? Well, yes…for now. But that’s no excuse for ignoring the trends or refusing to think about the future of automobile transportation. Why should I care about Uber or Lyft or Zipcar or Didi Chuxing or […]
October 4, 2016

Capstone Financial Group Announces Sale of Morris 4×4

Capstone Financial Group, an investment banking firm specializing in the auto aftermarket, has announced the sale of Morris 4×4 Center (“Morris”) of Pompano Beach, FL, one of North America’s leading Internet retailers of Jeep-only parts and accessories. Morris pioneered the consumer-direct Jeep Internet business with a significant head start over brick and mortar retailers and now sells more than 46,000 SKUs from hundreds of manufacturers covering every relevant product category for Jeeps. The company’s acquirer was a platform company backed by a New York-based private equity firm with significant investment experience in the auto aftermarket. “I chose Capstone because of its industry knowledge and ability to close a synergistic deal with the most appropriate buyer,” said Glenn Morris, the company’s founder and CEO. “This was a complicated transaction for a number of reasons, but Capstone structured a discreet deal at a very attractive price without having to run a complex, time-consuming process.” Capstone provided key guidance across several aspects of the deal. It epitomized the vertical food-chain type of acquisition that Capstone began predicting in 2007 as the Internet became more prevalent and three-step distributors became more dominant and aggressive. “This is the auto aftermarket world we live in now,” […]