Swiat motoryzacji (Automotive World mothly), Issue No. 7-8/2005

(Automotive World mothly), Issue No. 7-8/2005

A Brand Born in Marki

The end of 2004 saw a new market player in the Polish aftermarket – Fomar Borg Automotive. This was a result of the incorporation of Fabryka Okladzin Ciernych Fomar (Friction Lining Manufacturer Fomar) of Marki into the Borg Automotive holding.

The company is run by Mr. Leszek Waliszewski, with Mr. Krzysztof Frelek managing the sales and distribution. Both directors took an active part in starting the operations of Delphi in Poland. In the world of sport, such transfers would distort the balance in many leagues. In the world of business, where competing is less spectacular, the line of attack which has such top-class managers to its side is bound to make major changes in the rating of aftermarket leaders in Poland.

Rising Demand

“We specialise in the production of brake pads and shoes for passenger cars, as well as linings and pads for trucks, semi-trailers and buses,” says Mr. Frelek, Managing Director for Sales and Distribution at Fomar Borg Automotive. “Currently we market the products under our own brand Fomar Roulunds, and as of 2006 the products will bear the name of Fomar Borg Automotive. A large part of our products, nearly 30%, is sold directly in the markets of Western Europe. These products are marketed under many well-known brands and are made to order of different renowned business partners in Europe.”

Fomar Borg Automotive is one of the largest providers of brake pads and linings. The company’s share in the Polish market of friction linings for passenger cars amounts to 10%, which translates into the production of 600-700 thousand sets of brake pads each year. The company’s position on the linings market for trucks is even stronger, with a market share of 25%.

Brake pads are the fastest-selling of all wearable parts. They sell like hot cakes and the prospects are even brighter. According to Mr. Frelek, this optimistic view is a result of the market analysis. “We are in a more favourable situation than the producers of shock absorbers, for example. That is because the quality of roads in Poland – bad as it is now – is going to improve. This is bad news for producers of shock absorbers, but good news for us, because people will be driving faster in stronger cars and will be breaking harder. Taking into account that there has not been any revolution in the technology of production of friction materials, the demand for brake pads will rise,” states Mr. Frelek.

Polish Chance

The market of brake pads manufacturers and suppliers in Poland seems to be stable, with the best players in each league leading the fight for customers. The elite league consists of: LUCAS TRW, (ATE) Teves Continental, Bosch, and Ferodo. The premier league is composed of such players as Delphi, Valeo, and manufacturers from Italy. The second league – let’s call it “economic” – comprises: Fomar Borg Automotive, Lumag (Breck), Tomex, and some other Italian manufacturers. This classification is provided for convenience only and not all the players would welcome an advance. This is because it is sales and profit that counts, and these two figures are the strongest in the economic league which runs a chance of gaining the leading position. This very fact happened in other groups of wearable parts – filters and silencers, where the strong sales of Filtron and Plóciennik have demonstrated who controls these markets.

“As a Polish producer, we have a chance to win the battle for the Polish market and to win a strong position in some European markets,” says Mr. Frelek. “The production of brake pads is relatively simple and does not require any costly investments or research. With good organisation and an effective delivery system, we will be very competitive for the foreign products.”

What Counts

The second area of specialisation of Borg Automotive is remanufacturing of parts. Older readers may remember that remanufacturing used to be the speciality of the Polish craftsmanship, where every part in short supply – and that comprises nearly all parts – could be recycled. Today even such companies like Bosch and Borg are not ashamed of remanufacturing. The latter concern is a European giant for remanufacturing starters and alternators (200 thousand per year). In Poland, this is not very popular as yet because there are no suppliers focusing on collecting the parts. Moreover, taking the example set by older colleagues, each car mechanic would rather remanufacture the parts by himself. After all, money does not know anything about remanufacturing, and counts the same.