“I think we’re one of the last, large hard parts specialty houses that will ship a part directly to a shop while selling high-volume quantities to perhaps a half dozen production remanufacturer customers,” said Jeff Burris during a recent Transmission Digest visit to Dunkirk, Indiana hard parts supplier Teal Automotive, Inc. Jeff wears several hats as he oversees purchasing and overall facility operations.
Jeff continued by saying that Teal fills its parts inventory with a combination of parts reclaimed by salvage yards and those that are recovered by tearing down core transmissions. “At one point we worked with a company in a nearby town that we contracted to do teardowns of units for recovering parts we needed. Since that time, we’ve taken a building adjacent to this facility where we now operate our own teardown operation. We still maintain about the same level of core inventory but by owning it, and having it convenient to us, I think we have a little better control of what and when various units are being torn down. It’s easier to specify what parts need to be saved and which ones can be scrapped.
“Teardown is probably supplying 70% of our needs. The remaining 30% comes from salvage yards that do the tear downs in their yards and then ship us ‘layout stuff’ (Gaylord boxes of the parts we’re needing). For some time, several years ago, we’d gotten away from doing much tear down and we bought a lot more of the layout product.
“Some of the decision on whether or not to work from our own core transmissions is based on the scrap market. We have a company that buys our tear down scrap. They place a couple of trailers at the facility and when we fill one up, we call them and they bring us an empty one and haul the one full of scrap to their place. Right now, the market for scrap is horrible. When it gets this low, the price we pay for cores goes down and, at some point, people who have the cores start holding on to them with the expectation that prices will eventually go back up.”
Jeff told us that concentrating almost exclusively on finding recyclable hard parts has been the company’s primary business since day one. “Our niche is hard parts, always has been and we have set up to feed both high-volume remanufacturing customers and retail customers,” he explained.
Jeff and others at Teal say that the focus of their business hasn’t changed very much over the years. The parts they recover and sell change with time, but the processes and the attention to detail are much the same. Teal is, he said, a local-area parts distributor as well, handling Transtar parts and Precision of New Hampton converters. “This is important business to us and the local shops but doesn’t make up a very large portion of our sales. I would guess it to be somewhat less than 10% of our total business,” he explained.
“We still sell a lot of parts for the 4L60-E; there are a lot of those out there,” Burris said. “But, I think, parts for the four-speed units is on the way out and we’re starting to see the demand for six- and eight-speed unit parts. Units like the GM 6L80 and 6L90 as well as Ford six-speeds front-wheel drive units are becoming more important to our customers. And, as far as those six- and eight-speed units go, I think that the OE parts that go into later model transmissions are better quality than before. They seem to be failing less often.
“We were early into the market for CVT parts and found that the guys were a little scared to work on those units and so we backed off on our supply of those parts. Now, there’s been some information out there and we’re beginning to see our customers rebuilding more of those units here recently. Once a guy gets into the CVT units and starts figuring out what needs to be done, they really aren’t all that complicated. The OEMs have had them and then it seemed like they backed away from them and now they’re back to using them. I think it remains to be seen whether they’re here to stay or just something that was part of a cycle.”
Brad Alspaugh acquired Teal many years ago from the original owner (Transmission Digest June 2016, page 14). One of his long-time employees, Beth Fallis, formerly handled marketing and now oversees administration and human resources. She told us, “He [Alspaugh] hired good people and works through his brother Brad who is shop foreman, Jeff and me.
Jeff concluded our tour by saying, “There are new companies that come in and a few that go out, but what we do remains largely the same. We’re in the parts business and we think we’re very good at supplying what our customers need.”
Thinking Small
The sales team told us that If there’s one thing that truly sets Teal apart it’s the ability and dedication to supplying small parts, things like bolts, screws, bands and all the other little stuff that so many hard parts supplier inventories tend to skip over. “When a bolt is required to finish a job, it’s an important part. We’ve always had a great inventory of those items.”
These are parts, they said, that by themselves don’t bring in a lot of money for us but the fact that we can have them ready to ship helps us win the business for the bigger parts too.
