Fuel efficiency was the buzz amongst chip and module providers at SEMA, its message making its way into product ads, seminars and shop talk. “It started as a performance market,” reflects George Osmun of Revo Technik, with U.S. headquarters in Buford, Ga., “but fuel prices and environmental issues are driving it now.”
The good news is that as the need for economy expands the performance market and redirects its focus, manufacturers who are stagnating in one area can find new customers in completely different directions.
People who used to be concerned only with performance are now looking for ways to be more fuel-efficient than the factory software allows. Many are turning to chips, tuners and modules because aftermarket software can tune for a 10-15 percent increase in fuel economy in addition to as much as a 50 percent increase in horsepower (for turbocharged vehicles). For example, EPA estimates for Osmun’s personal 2006 Audi A3 were 22/25 mpg, but with the software, his Audi gets 28/33-35 mpg.
Numbers like that are getting harder to hit. Simon Silverleaf, CEO of van Aaken, with headquarters in the U.K., says 15 years ago, there was a lot of margin available in the engine. Generating a lot of performance and fuel economy by tuning was pretty easy. However, now the OEMs have, “taken a lot of what we’ve done with the engine and incorporated it, so there’s less margin available, and emissions reductions further reduce that margin.”
Jay Payson, sales and marketing with HP Tuners in Orlando, Fla., insists that a small amount of remaining margin can still provide power upgrades and improve fuel economy, depending on driving style. But, he cautions that outside that small margin, there’s potential for damaging the long-term viability of the engine. That’s why the new emissions restrictions are tough on the industry.
Dan Dolan, regional sales manager with DiabloSport in Boca Raton, Fla., agrees that emissions regulations, which he claims have had the biggest impact on the diesel market, change, “the way you do tunings and that programmers are now concerned with increasing mpg.” However, he adds, “We have to be careful. There are questions about what’s legal. The EPA is drawing a line in the sand with tuning companies.” He predicts that, “particulate filters will hurt exhaust manufacturers.”
Silverleaf explains that diesel particulate filters impact the back pressure, so some people take off the catalytic converter for better performance. However, he warns that many states, California in particular, are now checking equipment for emissions compliance.
Dolan confirms that tuners – who were accustomed to being able to get around emissions legislation by labeling vehicles off-road-use-only – must now change that classification to racing-only.
Because off-road claims are being checked, Payson says that although shops don’t want to worry about being legal, they have to, although he admits there’s less cause for concern with racing applications.
“It used to be easy to sell for off-road use,” says Payson, “but this is an election year, so there’s a lot of noise. In fact, it’s the loudest it’s ever been. The EPA is more actively involved, so shops need to be legal. We let customers know the product is for race-use only, or we adjust the parameters for street-legal use. Tuning shops can sell it as pending or off-road only, but you must substantiate that claim. Right now, nothing dictates how to validate an off-road-only car –maybe have the customer fax the time slip? Mazda Tricks has done that. It’s easier if you can see the car and sell hands-on.”
Performance vs. Fuel Economy
For most, the eternal goal is to get more power and performance. Many in the industry believe it’s possible to have both clean fuel economy and power within the legal limits. It may not be easy, and it will probably change the way things are done, but it could also open up new possibilities and new markets.
Payson sees “enormous opportunity” for a third party to develop emissions-legal kits for each popular year, make and model. He explains that individual companies are working to make their own combinations legal, but no third party is making combinations with products from other companies legal. Because the end user wants to customize, he uses various parts from different manufacturers, but is his combination street legal?
“Street legal-ness offers a huge, huge opportunity,” Payson claims. “The performance market is built on customization, so the kit idea is flawed, but because of emissions regulations, we have no choice. Specialists who are familiar with the makes and models could put them together. The issue is finding entities willing to take the risk, and then you have to figure out how to market and distribute them. There are a lot of challenges, but you know what they say: the first to market earns 65 percent more business.”
In the short-term, Dolan says, everyone is climbing a learning curve as they come to grips with adapting to the new legislation, but long-term, he knows people still want power and economy. He suspects the need to increase their fuel mileage could drive more customers to the performance market for tuning advantages. “We’re finding the answers as we go,” he summarizes. “There was a lot of talk at SEMA.”
Osmun believes the environmental regulations have more impact on the manufacturers than on the tuners. “The parameters are ignition timing, boost and air-fuel ratios: that never changes. What changes is the way manufacturers manage the parameters within the ECU or engine computer. Our software is limited within the scope of the manufacturer; if cars come with an EPA requirement of 40 mpg, it has a tremendous impact on the performance potential and how much performance we can generate. Cars are coming from the factory leaner, so there’s less for us to extract.”
Silverleaf acknowledges that it’s difficult to “do more” with recent vehicles. “All the units are plug-in boxes that make a connection in the vehicle. It’s difficult to find an appropriate place for the plug.” Another disadvantage of the downloaded box is being able to put it back on every time there’s a chip upgrade (done via satellite or in-shop), and Silverleaf says the manufacturers update the computers “all of the time,” so it becomes quite a chore. Still, he says, there is a small margin available and still a market for competition vehicles, albeit a smaller one. Don’t forget: the chips in original vehicles can accept a limited number of rewrites before they have to be replaced.
New Direction, New Offerings
In the current economic climate, the consumers’ goals may change from performance to economy. “If gas prices rise,” Osmun speculates, “the priority on performance will change along economic lines -that’s where the shift will happen. Our job is to respond to the manufacturer. We need to offer products to adjust to the needs or address both: daily driver vs. weekend at the track.”
HP Tuners makes a product which appeals to both markets. “Our product is a tool to tune a vehicle,” Payson explains. Shops, their target market, use the tool to tune multiple vehicles, including Ford, Dodge and GM. Payson adds, “We get a lot of kudos because of the ability to do more than one vehicle. The cost per vehicle tuned is lower because you don’t need hardware for each vehicle.” Typically, he says, the tool is paid for by the second tuning.
Edge Products’ flagship product is the Juice with Attitude, offered for all late-model domestic diesel trucks. It intercepts the signal from the vehicle’s ECU to optimize the pressure, delivery and timing of fuel. These modules produce anywhere from 20-130 extra horsepower and up to 350 ft./lbs of rear-wheel torque. The Attitude controls the Juice module, and it stays mounted in the cab to provide real-time monitoring of the truck’s vital engine parameters with five on-the-fly adjustable power levels.
Another important Edge product is the Evolution programmer. Available for gas or diesel trucks, this sleek device plugs into the vehicle’s OBDII (diagnostic) port to reprogram the ECU. “With up to four different power levels and huge gains in horsepower, this product is perfect for anyone who wants to tow, go, or simply blow away the competition,” reports JB Hinrichs, director of marketing.
Hinrichs explains the importance of digitally monitoring engine parameters to protect trucks from excessive exhaust gas temperatures, turbo boost, transmission temperatures and transmission slip. “Our high-end products don’t stop at just monitoring these parameters, but automatically back the power down to keep your truck under safe operating conditions.”
One product from van Aaken is an electronic programmable device that alters fueling and the timing to provide better drivability, torque and power is the SmartBox. It also improves throttle response and acceleration, as well as fuel efficiency. The module comes programmed with five predetermined tunes that vary from economy to moderately high performance, but with the addition of SmartMap software, it can be upgraded to allow custom programming. The plug-in module is easily fitted and removed and provides additional benefits, such as gearbox and engine speed monitoring to prevent gearbox slip.
Silverleaf says while their focus is Dodge, Ford and GM diesel pickups, he indicates that they also make modules for Toyota, which may receive some crossover benefits because of Toyota’s European testing to meet OE regulations. “They have very defined standards that specify the types of pollution you can produce and the levels you must meet.” He points out that regulations in the U.S. vary by state, which can make it tougher, or at least confusing, to properly tune a vehicle. As a safeguard, van Aaken’s modules are built to suit stringent regulations, which he says are found in California and New England. “We’ve put our modules through CARB testing in California for years.”
DiabloSport, which designs and manufactures chips, programmers and modules, is a leader in electronic handheld programmers of the ECU for Ford and GM. The company also targets Gen 3 Dodge diesel trucks (2003-’07). Dolan says they’ve recently added Chevy and Dodge, and he adds that a Trinity product gauge monitor is on its way.
The Predator is DiabloSport’s tuning flash programmer that can deliver up to 180 horsepower on some applications. The PowerPuck software remaps fuel delivery and advances the injection-timing curve for better drivability, torque and throttle response. Together, the two provide optimal performance and drivability. “Stacking gives you the best of both,” Dolan promises. “The module commands fuel ratings, the Predator reprograms the PCM.”
Stacking kits are easy to install, connecting to the fuel rail pressure sensor and MAP sensor under the hood, with a toggle switch through the firewall for adjust-on-the-fly ability, which Dolan says a lot of customers request. “If you use two manufacturers in a stack, results are unpredictable. Using a DiabloSport stack takes the guesswork out. You get a perfect result.”
Know Thy Customer
Manufacturing and marketing the perfect tuning product isn’t enough any more. Although even the most sophisticated fuel-injection system is still air, fuel and spark – just controlled differently – and shops that spend time to learn an application inside and out are able to finesse the calibration for optimum results, it’s important to keep the customer in mind. Payson reminds jobbers that, “the same combination won’t work for the racer and the consumer.”
He categorizes three types of customers in the chip and tuning market, from a shop’s perspective. “There’s the hardcore racer, the individual enthusiast who races two to three times a year and the individual consumer who wants a little more power from his vehicle. Shops must know which of three kinds of customers are coming in.” The consumer is the most frequent customer, he says, especially as concern increases about the rising cost of fuel.
But the vehicle that consumer is driving is also changing, so jobbers are well-advised to stay current on top models. Edge has found the most success with late-model domestic pickups, according to Hinrichs. “Gas pickups are a growing market, but diesels are immensely popular for performance electronics. These trucks have a lot of potential in gaining horsepower, torque, monitoring options, drivability and fuel economy gains.”
Specifically, Hinrichs says Edge has seen its best gains on diesel trucks. “Edge’s top power gains on a diesel engine are on the 2004.5-’05 Dodge Ram with the Cummins engine. Edge can add an additional 180 horsepower with 440 ft./lbs of torque to the truck. On a gas application, Edge’s top rating is on a 2007 GM, giving it an additional 40 horsepower and 40 ft./lbs of torque. These are all on top of the stock truck to the rear wheels at about 4,600 feet above sea level.”
Despite the limited availability of diesel vehicles in this country, Silverleaf says the diesel competition market is growing, as reflected by the DHRA and the NADM. But just because diesels are riding a wave of popularity, don’t count out the gasoline market. Dolan believes gas-powered vehicles are making, “strides into untapped areas of tuning,” which is why DiabloSport caters to Chargers, Magnum, Jeep Grand Cherokee and the Dodge Hemi SRT8 2005-’07. As Payson says, “When something is not available, it’s a squeaky wheel. Right now, the Dodge Hemi is making noise.”
Domestic tuning isn’t the only trend worth talking about. One of the changes to the market manufacturers are paying attention to is the rise of Japanese trucks. “Toyota and Nissan are coming,” Dolan testifies. Currently, he describes it as a, “huge segment of the market left behind,” and informs jobbers of the, “tremendous opportunity to take advantage of the market left behind and pick up customers.”
Picking up left-behind customers and exploring new outlets is more important than ever because, as Silverleaf points out, there are fewer people with disposable income and that is changing the market.
While Hinrichs admits that current trends show that more women than ever are driving trucks and dabbling in the performance line, he contends that the market remains predominately male. In addition, he says, “We’ve noticed it’s trending toward an older group, which we believe has something to do with higher fuel costs.”
Silverleaf says most of van Aaken’s customers come from the middle of America and their needs center on power for hauling and towing.
Osmun, on the other hand, says the Revo Technik’s customer demographic is, “as broad as the vehicle range,” and ranges from entry-level high school student with their first Golf to educated professionals with 977 turbo Porsches. “Particularly over the past seven years, they see a benefit to tuning.” That’s why their business covers the entire gamut: gas tuning; diesel tuning; consumer light and heavy truck, economy and performance tuning.
To an extent, Edge does too. Their products offer a variety of features and benefits to various consumers. All their products have a “mileage” or fuel economy setting for the customer chasing fuel economy (Edge also offers the Mileage Max for Dodge diesel trucks that increases fuel economy by up to 7 percent.). For customers who want towing power, there are products that provide extra boost to eliminate downshifting, which increases the life of the transmission and provides better power and a more efficient vehicle overall. Edge also covers the customer who wants it all: fuel economy, power and monitoring capabilities.
How To Get It All
Amidst the changing parameters for tuning, Osmun details the manufacturers’ process for designing new chips and modules to accommodate evolving engine specifications and environmental regulations. “We learn to communicate with the ECU through reverse engineering. It’s a two-step process: engineering means understanding the vehicle computer to create tuning tools to rewrite the data, and then tuning to incorporate that knowledge into a language we can manipulate and apply.”
That may be interesting and even helpful, but what the jobber really needs to know is vastly different from what the manufacturer needs to know. “The one thing a jobber must know is how to tune,” Payson emphasizes. He credits passion for the industry with the incentive for knowledge. “We’ve seen more inflow of capital in the last few years, but there are still business out there doing this for enthusiastic reasons than just a return on investment. To do it right, you must love and understand it.”
Along with knowledge and understanding, he says shop owners need to make wise choices in spending, placing importance on inventory and tools for adaptability and evolution programs. “Shops and manufacturers that are able to adapt will be most successful, so shops should look for manufacturers willing to innovate. Venture capitalists won’t: it’s too risky.”
As with all businesses, spending money wisely is a concern. That’s why support from the manufacturers can make such a decisive difference. To assist shops, DiabloSport is working toward one SKU. “Stocking products is harder when you’re competing with the Internet. By dropping SKUs to one (by populating one circuit board with all the necessary components), we’re making it easier for jobbers to invest.”
Edge supports shops through the traditional two-step distribution channel. “We’ve found that by pushing customers to the jobbers, there is a win-win opportunity for both businesses,” Hinrichs states. “We get international distribution and jobbers make a healthy margin on their products. In most cases, a jobber will make an additional 20 percent over the cost of the products they buy and sell from Edge.”
Dolan, who says DiabloSport’s first tuner was so successful, it went on backorder within three months of its initial release, believes it’s possible to sell kits and have field support. The trick is knowing your market. “Custom tuning is designed for dyno shops; the programmer side is for anyone. Dyno shops want repeatability. They want to see horsepower gains, make changes, make money…”
Payson says there’s no longer easy money in this industry. “Anyone can buy a box, and you don’t need anyone to plug it in for you any more.” The jobber should be looking for the best tool to modify the electronics when he’s tuning an individual car. “Not the mass market stuff – websites sell those.”
He believes that the next round of innovations will come from jobbers because manufacturers won’t take risks, but he adds a caveat of caution. Too much risk isn’t good. Shops need to look at the demand for a particular combination because there’s a larger financial investment to ensure liability, beginning with an outlay of $3,000-$4,000 for emissions tests. On the other hand, there could be seldom-considered benefits to those expensive tests. “During emissions test, they also test fuel economy. That gives you hard data to advertise your product.”
“There are not a lot of companies doing this,” Payson continues. Reiterating the oft-heard phrase that the market is changing, he urges jobbers to adapt quickly, define their market and forge relationships with reputable manufacturers.
As Dolan puts it, the EPA regulations are coming in 2008 and they, “rule the OEs.” Silverleaf reminds the industry that there will be more new regulations for all diesels in 2010 – with no retrofitting. “For so long, the regulations were aimed at gasoline cars, but now diesels have to think about them too.”
That’s okay, Payson counters. Technology and legislation typically prod innovation. “We’re going to have grandkids that need clean air,” he forecasts. “While the auto is not as big a problem as some say, we can do our part to minimize pollution and still have performance and be clean.”