The Drag Market Mix

Dec 2, 2009

In the time it takes most people to tie their shoes, a drag racer’s fate is decided. A blur past the bleachers to the finish line, the dragster’s speed is matched only by its audible force. The same noise that can rattle windows and blast out eardrums sounds like a pleasant cha-ching to engine parts manufacturers. Why? Despite tough economic conditions, drag racing remains wildly popular, allowing providers of camshafts, crankshafts, rod connectors, piston rings and more to better their products for the sport.

“We’re all involved with all aspects of the business,” says Keith Jones of Total Seal about his company’s dynamic. “We talk about new products, get customer feedback and digest that information. We’re constantly looking to improve.”

Product improvements are vitally important to both professional and amateur drag racers as they edge for any possible advantage in speed, power and overall performance. That said, there are questions to consider while servicing the drag racing market:

Which drag racing series are gaining popularity?

How much is today’s race team willing to spend in the current market?

What products do drag racers seem to rely on most?

Finding the answers could add dollars to your business’s bottom line.

PRODUCTS FOR PERFORMANCE

Each time a drag racer steps on the gas pedal, product demand is driven up slightly. As the racing season progresses, an assortment of new items are needed to replace old ones or to increase performance.

“Products that are moving for us are custom cams and custom cranks,” says James Humphrey, sales and product manager, Lunati. “They are still big items, especially during the racing season from February to November. Building up to the February time frame is when you’re generally busy for custom stuff; everyone is building motors.”

Overall, many companies have witnessed either a steady flow or a jump in sales this year, despite a perceived economic downturn. According to Jack McInnis, advertising director at Dart Machinery, more exotic components like billet blocks and compacted graphite iron (CGI)-in addition to a trend toward larger displacement engines-are on the rise.

For Lunati, a bevy of new products have successfully been released this year including Beehive valve springs, Rocker arms and a line of Voodoo solid flat tappet camshafts. “We’re doing well with our rocker arm line,” says Humphrey who explains that Lunati has also released High RPM Hydraulic Roller Lifters which are “pricy but not intended for driving around the street-these are for high RPM for drags.”

Still, others remain lucrative by relying on their bread-and-butter-type products. For Total Seal, that means reading the market’s assessment of piston rings.

“There is gravitation toward the top-of-line, higher-end products versus everyday generic replacement rings,” says Jones, citing that AP Steel Rings and Diamond Finish Rings are popular products. “Budgets are a concern but who was the last person that said, ‘Hey, I’d like 20 less horsepower?’ We’re racers; we always want more even if we can’t use it.”

The fact is that drivers are not going to compromise the performance of their cars just to save a few bucks. That notion resonates up through the sales chain, from customer to manufacturer.

“In spite of the economy and its effect throughout the racing industry, our sales through the first half of the year have been extremely steady and are consistent with where we were at this time last season,” says KC Couse, drag racing program manager, CV Products. “Our primary sales growth has come from three products that we manufacture: Xceldyne titanium valves, valve train components and XTS cam drives.”

Sean Crawford, marketing specialist, JE Pistons/Sportsman Racing Products (SRP), has noticed that in order to offset costs, customers have attempted to extend the life of engines and components, which is why he believes it’s imperative to provide high quality products. “Our products generally cost slightly more than average,” he says, “but they will cost less in the long run.”

Costs are a hot issue today, especially with constantly rising fuel prices. In this increasingly price-conscious and green-minded world, much emphasis has been placed on fuel efficiency. As a result, engine parts manufacturers are striving to create such products as an option for racers.

“We sell high-efficiency camshafts that help maintain gas. It’s a small part of our line, but we do have products like that,” says Humphrey. “These types of products are absolutely on the rise for the future. Aftermarket companies have been talking about it for three or four years.”

However, Crawford argues that performance is still the main consideration among drivers. “When it comes to the race cars,” he says, “I think most drag racers will not sacrifice horsepower to achieve a slight increase in fuel efficiency.”

FUEL FACTORS

Still, there is no denying the fact that higher gas prices are cutting in on other expenditures, and drag racing is certainly not immune to the soaring costs. What’s the immediate impact? For one, participation seems to have decreased due to a more conservative approach among racers.

“What we have seen with the increases in fuel prices are racers choosing to limit their travel nationally and preferring to stay more regionalized in planning their racing calendar,” says Couse. “This of course has had an effect on car counts, most notably with fewer cars turning out for some of the national events on the West Coast. But overall, I think interest is rising, and we see more people interested in not only watching but participating in drag racing.”

Jones, who has observed the same stay-at-home behavior, offers his opinion for why drag racers still need to be spending money.

“Racers are definitely curtailing travel,” he says. “There are a lot of people that are scared to spend. The media has hyped up [the weak economy] so much. People need to spend money like they did after 9/11. They need to buy cars, buy houses and keep the money moving in the economy. You look at the numbers and it’s not that bad, but everyone’s been scared.”

Jones continues by noting that the unemployment rate is still low and noticeable inflation has yet to appear which is encouraging. However, the entry-level racer is still affected considerably because of the strain on their already limited budgets.

“A lot of the Sportsman racers would compete in a drag series but most of those people are staying closer to home instead of traveling,” says Humphrey. “These Sportsman categories don’t pay what it’s costing in fuel to get there. It’s hard for them to justify traveling.”

However, those racers competing for points aren’t feeling such a strong dollar crunch.

“The professional teams are more able to deal with the added cost,” says Crawford.

Humphrey agrees by saying, “The only ones that are doing major traveling are people in it for the points,” though he adds, “even some of them are looking at the schedule and saying, ‘I have a pretty good lead, and I can sit out and still maintain the points [advantage].'”

For parts manufacturers, fuel prices have not dramatically affected sales-perhaps because necessary adjustments have been made with concentration placed on the most popular products.

Says Crawford: “Despite high fuel costs and the current economic condition, the drag racing market has been strong for both JE and SRP Pistons in 2008. We have seen a significant increase in sales of some big-block and small-block Chevy parts.”

For those who are experiencing a slowdown, Jones cites not only fuel-based issues but an unfavorable economy and weather conditions as potential business busters.

However, “Overall fan attendance at the race track just seems to keep going strong,” says Couse. “The level of interest in NHRA seems to grow and grow each season and the fans are coming out to the events in great numbers all across the country.”

STEPPING UP THEIR GAME

The fans get it. They speak in acronyms such as NHRA, IHRA and ADRL. And because drag racing has continued to gain popularity, racers at all levels have made more of an effort to impress the masses.

“Dart has been seeing high demand for our top-level racing engine components in particular,” says McInnis. “It seems that more and more of the Top Sportsman type racers are stepping up their game.”

According to Crawford, many racers are pushing the sport forward by breaking records. He references Jeremy Lookofsky and his DVS Shoe/Drag Cartel All-Motor Honda Civic. “The All-Motor category is the sport compact equivalent to NHRA Pro Stock. In 2007, Lookofsky set the national record for the quickest and fastest All-Motor car at 9.33@146.31MPH,” says Crawford. “In 2008, he has again set a record with a 9.18@148.11MPH. It’s good to see that the drive and enthusiasm is still alive in the sport compact drag market.”

However, Crawford believes that, on the whole, the sport compact market is dwindling a bit. For example, this year the NOPI and NHRA “merged” to create the “NOPI Drag Racing Series sanctioned by NHRA.” Also, The NOPI/NHRA Series is limited to eight events; six of them being held on the East Coast.

“It’s disappointing to see no races in California or Nevada,” he says.

But in no way does this point to a weak drag racing market. For many racers, their tastes have simply shifted to other series.

“The ADRL really seems to be seeing a lot of growth right now,” says McInnis. “It is very popular with the fans as well as the racers.”

Couse agrees saying, “One of the fastest growing series in the country is the ADRL Pro Mod circuit. It seems to really have caught on in popularity and really is on the rise.”

Crawford confirms that ADRL and BOTI are gaining interest, adding that “drag radial and nostalgia racing are very popular right now.”

Of course, the NHRA still covers the most ground in the drag racing industry and is “the big boy on block” according to Jones.

Couse gives a nod to NHRA as well saying it continues to grow and is “the centerpiece of drag racing for competitors, manufacturers and fans. It really is the strongest series overall.”

Couse credits the increased interest in youth classes as a possible direct result of the rise in popularity and media coverage of the NHRA, drag racing and all motorsports across the board. “It seems,” he says, “that more young people and their families are choosing to invest their time and money into participating in the junior dragster classes.”

Such activity helps build the entire drag racing community. And that’s really what the sport is all about: a community that supports one another. Without the driver, we wouldn’t have a race. Without the parts manufacturer, we wouldn’t have the car, and without the resellers, we wouldn’t have the wide-spread reach.

“We’re all racers that have our own cars from motorcycles [down the line],” says Jones. “Because of that, we’re trying to produce products for not only our customers but ourselves.”