This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

#DigitalSkeptic: It's Dealers vs. Car Makers in Smart Car Smackdown

NEW YORK (TheStreet) -- Sure, drivers may soon find themselves behind the wheel of smarter Chevys, Fords, Nissans and Audis. But Colin Ehrhardt is pretty darn sure those car companies won't be the only ones making smarter cars.

"Five years ago, I never thought we'd be building smartphones, tablet adaptors and sophisticated electronics into single-unit faceplates that fit over the entire center console of a vehicle," said the director of research and technical services for Metra Electronics, the Holly Hill, Fla., aftermarket automotive electronics and audio company. "But now we are so dialed into what the customer wants that we make a good living doing work like that every day."

Ehrhardt was kindly giving me a tour of the latest aftermarket smart car products he's helped design: Entire replacement consoles for the clumsy control units on late-model Camaros. Or smaller retro kits that upgrade, say, my '89 Honda Civic for touch-screen control and new-age, smartphone-like features.

Metra and companies like it, such as Oxnard, Calif.-based Scosche Industries, are part of a growing group of surprisingly robust car electronics and systems makers that are not actually car makers. Rather, these aftermarket smart part producers, with roots in car electronics and security systems, have become global experts in retrofitting not only radios and GPS systems into vehicles; but also designing and manufacturing end-to-end integrated intelligent vehicle technologies such as collision avoidance systems, complex in-vehicle computers and even apps and software.

Ehrhardt declined to tell me his sales, but I believe him when his says his firm employs more than 400 in several U.S. production facilities. Even a brief browse through the smart aftermarket parts market shows the beefiness of Metra's market. Take Scosche's brand-new replacement console for later model F-150 pickups. This easy-to-install upgrade costs only $450, yet replaces many of the functions of the $2,300(!) premium option package offered directly from Ford. Scosche would not comment on sales, but go look at its website and you should see the basically new part out of stock.

"The line between the new car and the aftermarket car is blurring," is how Ehrhardt explained it.

All of which implies that investors better find their seat belts. The exact same smart vehicle technologies that mainline automakers and technology giants such as Google, Microsoft, Pandora and others have been hyping relentlessly as the future of cars now face a brutal, low-cost competitor: the decentralized, outsourced, digitally enabled automotive supply chain.

In other words, the business of smart cars competes with itself.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
AAPL $123.25 0.00%
FB $83.30 0.00%
GOOG $548.34 0.00%
TSLA $185.00 0.00%
YHOO $45.10 0.00%

Markets

DOW 17,712.66 +34.43 0.19%
S&P 500 2,061.02 +4.87 0.24%
NASDAQ 4,891.2190 +27.8570 0.57%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs