Building Muscle in 2010

Feb 22, 2010

The new year is just getting up and running, and already there are positive signs for the muscle car market.

With today’s breed of Camaros, Challengers, Mustangs and others joining their first-generation counterparts, it’s safe to say muscle cars will again play a big role in the performance aftermarket in 2010.

But where exactly will the growth be, and how can speed shops position themselves to take full advantage of a hot market in a lukewarm economy?

We asked those questions and more to some industry professionals, who provided food for thought on building a little muscle this year.

Passion Comes First

Our first question was regarding the general market outlook for 2010.

Chris Casperson of Pypes Performance Exhaust starts us off. “As with most markets, the economy is forcing some owners to postpone purchases,” he says. “However, these owners are very passionate about their hobby and if they are employed, they are very willing to continue to spend money on their passion.”

Dr. Jamie Meyer of GM Performance Parts adds, “We saw some strong signs of the market turning more positive in December, and we hope that trend continues for 2010. GM vehicle sales were extremely strong in December, and GM Performance Parts sales typically follow those trends.”

Carl Bush of Wilwood Engineering says, “We see the outlook for 2010 as very bright. Despite the slow economy in 2009, Wilwood maintained an aggressive development program dedicated to bringing several new products to market in time for the 2009-’10 promotional show schedule. These new products, as well as many of our already established products for the muscle car market, received a more-than-favorable response at SEMA, PRI, IMIS and a number of other regional special-interest shows. Orders for these items over the final quarter of 2009 suggest that sales will continue to be brisk during 2010.”

Steve Wolcott is CEO of ProMedia and its two racing organizations, the National Muscle Car Association and the NMRA Ford Nationals.

Looking at muscle cars from a different angle, he says, “NMRA and NMCA both expect 2010 to see an increase in racers and fans, because of passion for street/strip muscle car drag racing and a rebounding economy. As unemployment rates fall and the stock market rebounds, racers will once again feel comfortable increasing their discretionary spending and time away from work.”

He, too, believes that passion for these cars will ultimately win out.

“Muscle car racers and show participants are a very passionate group,” he explains. “Once they have their car, their prized possession, they are sure to attend events and participate, as long as the events are well-run and reasonably priced. NMRA and NMCA events benefit from people looking for affordable, exciting entertainment. The ‘stay-cation’ crowd who used to go to Disney World or NYC for vacation are now staying local and going to events like NMRA and NMCA races.”

He adds that the NMCA is even looking to grow the car show portion of its events with new show classes, awards and media exposure.

Finally, Allan Miller of BMR Fabrication says, “Good question. I just wish I knew the answer! The suspension market started to turn around in the fourth quarter of 2009. I hope this is the beginning of a trend and not just a blip of ‘noise’ on the performance automotive financial graph.”

Old and New

We then asked our experts if they believe then “new” muscle cars will affect the older car market and how.

Miller from BMR says, “I think that the new breed of muscle cars will help to promote the Pro Touring movement and change the restoration plans for many muscle car projects. The improvements in power output and handling capabilities of the modern muscle car will help to convince many car owners to install modern engines, brakes and suspension packages in their classic muscle cars.”

Wolcott notes, “There has been a renewed interest in muscle cars ever since Ford introduced the all-new S197 Mustang in 2005. Both older and younger enthusiasts all craved this new ‘modern muscle.’ Chrysler soon followed-up with the new Challenger and then GM released the 2010 Camaro. Younger enthusiasts, who might have been fans of the sport compact segment a few years earlier, are now rediscovering the muscle car market.”

Muscle car fans love the classics, he says, but also the latest technology.

“Modern innovations such as supercharging and turbocharging, combined with modern computer tuning, make these modern muscle cars very exciting to modify,” he says. “Older enthusiasts, who might have owned a 1965 Mustang or ’69 Camaro back in the day, are now discovering how cool today’s new Detroit muscle cars are when they are packed with power and offer all the creature comforts of a new Caddy!”

Bush of Wilwood says, “I don’t know if there is any direct correlation between those niches, but there is high interest in all those that were mentioned. It’s no doubt that the recent soft economy has dampened, or maybe more appropriately delayed, sales in some areas.”

The trend he’s seeing is sales being made on an as-needed basis.

“In a more brisk economy, enthusiasts were more likely to buy by opportunity when they found items of interest for their particular project, and shelve those items until the project had progressed to the point to install them,” he says. “Over the past year, enthusiasts seem to be holding their money longer and then buying only when the time of final need has arrived. More time has been spent shopping and gathering information to more closely evaluate all the available options and the best value-oriented buys. But our sales and growth numbers over the most recent quarters indicate that the true enthusiasts are still active.”

GM’s Meyer adds, “I think the new cars only enhance the older ones by raising awareness of the incredible history of these brands.”

He notes that GM Performance Parts has had particular success in the muscle car market with its new crate engine offerings.

And Casperson of Pypes Performance breaks it down simply regarding the old and new versions: “They feed off of each other,” he says.

TV Tie-Ins

From Barrett-Jackson Auctions to rebuilding shows, muscle cars get plenty of TV airtime. And that has to help the market, right?

“Muscle cars are hot, as an investment or fresh content for a TV show,” says Meyer “It is clear that most ‘car TV shows’ are following the trend toward more attention to muscle cars. And the auctions (and their coverage) have served the community well to both bring attention to the market as well as give a clear indication on the value of these cars.”

Casperson adds, “I think it has heightened awareness of the value of these vehicles. This has pulled more people into the market.”

Like much television programming, not all “reality” is actually real, Wolcott notes.

“From a vehicle ownership perspective, the Barrett-Jackson TV programs have made the average enthusiast feel like owning a classic muscle car is probably out of reach,” he says. “Some enthusiasts have opted to stay away from first- or second-generation Camaros and go with more affordable and plentiful third-generation cars.”

But he agrees that the exposure is helping the industry.

“Barrett-Jackson-type programs have helped foster a desire for fans to come out to NMRA and NMCA events to see firsthand the cool Detroit muscle that has been a part of American culture since the 1950s.”

Bush, too, sees the positive impact.

“The Internet and widespread TV coverage of the collector and enthusiast car market continue to have a positive impact on the perpetuation of the hobby and the businesses that support it,” he says. “There is more information available in more places now than ever before. Consumers are far more educated and tech-savvy than I have ever seen. These mediums have also introduced many enthusiasts to vehicles and product opportunities that they may have not previously considered. ”

And Miller hopes the notoriety has a positive effect on consumers.

“Car owners are more willing to spend big bucks on EFI engines, 6-speed transmissions, and suspension packages after watching Barrett-Jackson,” he says. “They are hopeful that their resto-mod project will be worth the same amount as the cars sold on TV, so they are more likely to invest extra money to upgrade the performance of their classic muscle cars.”

Younger Enthusiasts

So, what about the graying of the industry? Is there a new generation of muscle car enthusiasts ready to carry the torch?

The answers are mixed.

“Hot rodding and nostalgia go hand-in-hand,” Bush says. “My most recent experiences with enthusiasts from a younger demographic indicate that exposure, whether through shared experiences with hot rod-oriented family members or the ever-expanding sources for information on the subject, is nurturing a very well-informed and interested group. Whether they can afford a premium older collector car to restore or customize may be a whole other question, but it doesn’t keep them from applying their interest to cars more in tune with their age group or income.”

But Casperson sees it differently.

“Not so much,” he says of younger fans. “It’s mostly 45- to 65-year-olds that are participating. The exception would be the new Mustang which is, and will probably always be, an American icon.”

Miller agrees. “Although younger people may be interested in 2010 Camaros, they are not buying them,” he says.

And Wolcott agrees that price can be an issue.

“Younger enthusiasts who might want an older muscle car might be discouraged by the prices they command,” he says. “Younger enthusiasts love all three of the modern muscle cars, however, the new Mustang is more attainable because the secondary market has kicked-in. You can now buy a 2005 or ’06 Mustang that is out of warranty for a very reasonable price. The money a younger enthusiast saved can go towards performance upgrades.”

Meyer puts it this way: “GM Performance Parts is seeing an amazing trend in, of all places, the sport compact market. These folks are finally waking up to the fact that you can drop in a muscle car engine, like the Camaro/Corvette’s 430-hp LS3, and it will make more power and be more reliable than a small-displacement 4-cylinder. I think you will see more and more RX7s and Nissan Zs running around with LS power in 2010.”

The Ones to Watch

Finally, we asked each of our contacts for particular areas of the market that promise to be profit-makers for local shops.

“The wheel industry and the opportunity to compete in closed-course racing events with street-driven vehicles continue to drive sales for custom and high-performance brake products,” says Bush. “Over the past few months, Wilwood has released two new direct-replacement brake calipers that cover 1965 through1982 Corvettes, and most of the factory GM muscle cars and classic-era light trucks from the ’60s, ’70s and early-’80s. We expect them to be very popular.”

Meyer notes that shop owners can get with local GM dealers to develop profitable partnerships. “Our dealers are always looking for up-and-coming speed shops to work with to help expand the distribution of our product line,” he says.

Miller also sees the opportunity the newest line of Camaros is providing.

“Owners of fifth-gen Camaros are very willing to modify their vehicles, even though the cars are well-designed straight from the factory,” he says. “You would think that the vehicle owners would be satisfied with 425 hp, 20-inch tires, large brakes and incredible handling. In reality, 2010 Camaro owners still want their car to outperform their buddy’s car, so they are happy to spend money to improve the performance.”

Finally, Wolcott says he is very optimistic about the muscle car market this year.

“There are lots of opportunities to make money in the muscle car market. Older muscle cars require everything from restoration parts to suspension and brake upgrades. Engine performance is always a must with muscle car enthusiasts who want more power and performance upgrades.”

And he notes that while many of the enthusiasts are do-it-yourself types, they can always benefit from the knowledge, and inventory, a local speed shop provides-especially with the new generation of Detroit muscle.

“Modern muscle cars are just that-modern,” he notes. “Enthusiasts will purchase performance upgrades, but quite often they require custom computer tuning to make them all work together and maximize their performance advantage. Many shops are now installing chassis dynos so they can put the cars on the ‘roller,’ computer-tune them and give the owner real-world performance numbers. Quite often, modern muscle car owners will want to maximize their performance with supercharger or turbocharger technology, which lends itself well to the new vehicles as well.”

Sounds like building muscle might be the way to go this spring.