Competition in the North
American radiator aftermarket is expected to reach new heights as global companies
wrestle to increase their market share.

According to new strategic
research from Frost & Sullivan (www.frost.com),
"North American Automotive Radiator Aftermarket," this industry generated
revenues of $480.1 million in 1999. Revenues are projected to reach nearly $650
million by 2006 reports Frost & Sullivan.

The biggest question facing
this market is how will the industry combat the growing threat from large manufacturers,
such as Visteon Climate Control Systems and Delphi Harrison Thermal Systems;
companies who are moving away from being just original equipment (OE) suppliers
and beginning to aggressively pursue the aftermarket.

Visteon began its big push
for the U.S. radiator aftermarket in 1998 through its acquisition of ARS Inc.
Delphi is expected to enter into the U.S. aftermarket with even greater vigor
in 2001, when it would be able to distribute under its own brand name and not
just GM-SPO’s ACDelco. These multi-billion dollar global giants are acquiring
smaller market participants becoming one-stop aftermarket automotive engine-cooling
and air-conditioning suppliers."

Visteon, a $19 billion company,
and Delphi, a $29 billion company, could prove to be extremely formidable competitors,"
says Frost & Sullivan industry expert Meenakshi Ganjoo. "However, Delphi
does need to make some major production and distribution decisions in the near
future to make a significant dent in the aftermarket. Like Visteon, it is probable
that Delphi will achieve this through acquisitions."

The consolidation in the
radiator aftermarket challenges smaller market participants to find ways to
maintain their market share. Many of these smaller manufacturers will more than
likely either be absorbed by their larger competitors or leave the market completely.
To remain competitive with these large companies, smaller aftermarket manufacturers
will have to either broaden their product lines or focus on niche markets."Those
manufacturers who cannot supply all the parts will be left behind," says
Ganjoo. "One of the challenges for aftermarket manufacturers is to maintain
adequate parts coverage, while containing costs. These market participants must
be able to supply all variations of radiators promptly. The company that can
ship the right part in the shortest amount of time will win the race."

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Smaller manufacturers can
hold onto their market share by meeting original equipment manufacturers’ (OEMs)
standards and providing needed parts to larger manufacturers. Large companies
will outsource some of their work to those manufacturers meeting these requirements.

"Manufacturers who
are Tier I suppliers or are able to meet OEM standards will be better placed
to emerge successfully," says Ganjoo. "It is likely that most of the
bigger manufacturers will not be able to produce a complete radiator line. In
that case, they may acquire the parts they need from other aftermarket manufacturers."

Frost & Sullivan presents
the 2000 Marketing Engineering Awards to companies that have worked hard to
make a positive contribution to the North American automotive radiator aftermarket
industry. The Competitive Strategy Award is presented to Visteon Climate Control
Systems Ltd VC.

Manufacturers that participated
within this industry include: ACF Heat Transfer Components; Bauer Radiator Inc.;
CSF Inc.; Delphi Harrison Thermal Systems; Denso International America Inc.;
Genera Corporation; General Motors/Service Parts Operations/ACDelco Aftermarket;
Go/Dan Industries; Modine Manufacturing; Perfect Cooling Products; Performance
Radiator; Silla Cooling System; Spectra Premium Industries Inc.; Thermal Components;
Universal Auto Radiator Mfg. Co.; Valeo Engine Cooling Inc., Visteon Climate
Control Systems Ltd., and Wolverine/Trentrade Co. Inc.

Frost & Sullivan, which
is headquartered in San Jose, Calif., is a global leader in international strategic
market consulting and training. Frost & Sullivan’s industry experts monitor
the ground transportation industry for market trends, market measurements and
strategies.

This ongoing research is
used to complement the Automotive Aftermarket Custom Subscription, which includes
studies on the U.S. Automotive Carburetor Aftermarket and the U.S. Automotive
Fuel Injector Aftermarket. Executive summaries and interviews are available
to the press.