The global supply chain

News Lucas Deal July 10, 2013

shutterstock_14514295First introduced in North America decades ago, globalization allowed overseas truck OEMs and component manufacturers to enter the North American marketplace with their products and services, and spurred domestic manufacturers to branch out as well.

Globalization united an industry that had historically operated independently at different locations across the world.

Now globalization is commonplace.

Customers don’t bat an eye when buying parts assembled in North America using raw materials from Asia and a European design.

But just because aftermarket customers are comfortable with globalization doesn’t mean we’ve mastered it. There are benefits and drawbacks to how globalization has been instituted in North America, and all of those factors are on display in the market.

To truly understand how globalization has evolved in North America, you have to go back to the start.

“Cummins has had a global presence for nearly 60 years,” says Tracy Kiser, the company’s on-highway marketing communications manager. “By 1955 Cummins engines were being sold in [more than] 110 countries and Cummins had 140 sanctioned sales or service organizations outside the United States.”

Many companies took a similar approach, but it wasn’t until European truck OEMs Daimler and Volvo entered this market more than 30 years ago that globalization truly exploded in North America.

European suppliers quickly followed the OEM migration and North American businesses were equally active, expanding their facilities overseas.

It was a busy time for the industry.

“The aftermarket people didn’t fire the first shot, we followed the OEMs,” says Rick Hoffman, vice president and partner at S&S Truck Parts. “I would say back in the 1970s maybe 10 to 15 percent of [the industry’s] products were being imported into the U.S., then that number exploded and was constantly growing.”

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