Click on a thumbnail to see the full-size image
Performance Market Niche Specialists: There Has Been A Rebirth In Street Performance
By Larry Carley
The performance market is hot these days. No doubt about it. Motorsports is the number one spectator sport in America. Millions of people not only attend professional auto racing events all around the country, but are avid viewers of racing on cable and broadcast television.
What’s more important to our readers is the fact that the number of people involved in both professional and amateur motorsports is at an all-time high. This includes everything from local circle track racing to drag racing, road racing and off-roading.
There has also been a rebirth in street performance, too — not just restoring vintage muscle cars and building smallblock Chevy V8s, but hopping up V6 engines and even small displacement import four cylinder engines. Import performance engine building has been particularly hot on the West Coast for a number of years, and is gaining momentum in other areas of the country as well. Bolt-on turbochargers and nitrous oxide systems can make little engines outperform naturally aspirated engines of much larger displacement.
A strong economy has also been a key factor in creating today’s performance market. With more disposable income to spend, many people are indulging their hobbies with bucketfuls of bucks. Consequently, engine builders who have specialized in performance engine building have found it to be a profitable niche.
One common denominator with all performance shops is a love of racing. Most of the owners are either involved in racing themselves or are former racers. Many also sell performance parts as a sideline. Some also sponsor racecars of various types.
Those who have found their niche in performance engine building say it isn’t an easy niche to get into. It takes years of experience, state-of-the-art equipment, extreme dedication and attention to detail to succeed. Reputations aren’t established overnight. It takes time for customers to spread the word that "so-and-so" does top quality work. And even when word gets around, you have to give 110% every day to keep on top.
It’s a highly competitive business and the technology is always changing. Staying on the cutting edge isn’t easy, but the rewards are both financial and emotional. There’s a great deal of satisfaction that comes with building a race-winning engine.
"We get a lot of customers who spend $3,500 to $8,000 on an engine," said Dick Fox, owner of Champion Automotive Machine in McCordsville, IN. "We also get customers who will put $13,000 to $14,000 into a 540 or 555 cid big block V8."
Fox said about 80% of his volume is performance work, mostly drag racing engines, though he is starting to do more circle track engines, too. Although he currently has only a two-man shop, Fox says he has more work than he can handle. He is building a 2,000 sq. ft. addition to expand his shop, showroom and parts business, and is also putting together a web page so he can promote his business and sell parts over the Internet.
What’s the secret to his success? Hard work, long hours (up to 100 hours a week), a lifelong dedication to racing (Fox has been in business 38 years and races a supercomp dragster), and a "personalized" approach to engine building.
"We don’t sell canned motors like some engine builders do. We sit down with our customers and talk with them so we can establish what they’re trying to accomplish and how much they want to spend. Then we custom build them a motor that meets their expectations and budget."
Fox said racing is his lifestyle. "If we’re not working in the shop, we’re at the track either racing or talking to our customers." He said his business has been built up by word-of-mouth advertising and personal friendships that have been established over the years with his many customers.
As of January 1, 2000, Fox is changing the name of his business to Champion Racing Engines and will concentrate on performance engine work exclusively. "It’s our niche," said Fox. "We see a growing opportunity in building engines for bracket racers, and for the super and rod classes in IHRA (International Hot Rod Association) that are running 8.90, 9.90, 10.90 and 11.90 times."
Finding the right niche
Chester Crossant of AHM Performance in Baltimore, MD, is another custom engine builder who has found his niche in the performance market, and is continuing to refine it.
"PERs are killing custom engine builders who only do stock engines. Their prices are just too competitive. That’s why we rarely see a customer who wants a stock Chevy 350 anymore. If somebody wants a stock motor, they’ll probably get it from a PER. That’s why about 80% of our work is high performance."
Crossant said he’s been in business 20 years and has four employees, two in the shop and two in his parts store. He used to be a drag racer himself, but doesn’t race anymore. He said his customers are typically males between the ages of 19 and 30 who are into drag racing, circle track racing or street performance.
"A typical customer will usually invest about $7,000 in a motor. We’ve found that street motors are often more profitable for us than drag racing or circle track motors. A lot of guys are running blowers or nitrous oxide on the street, which may require O-ringing the block and a lot of other modifications to handle the power.
"Customers are spending a lot of money today on aftermarket Dart and Brodix heads rather than putting the money into modifying their stock heads. We have a Superflow flowbench and do some porting and polishing by hand, but we don’t rework many stock heads because the aftermarket heads are so much better right out of the box. It’s the same with connecting rods. We sell Eagle rods rather than recondition stock rods. We also sell a lot of aftermarket Eagle and Scat crankshafts because it’s hard to find stock steel cranks for some motors."
Crossant said one of the most profitable services his shop performs is balancing. "For a typical smallblock V8, we get $150 as a base price. But on some cranks that require a lot of heavy metal, we can get up to $600 by the time we’re done."
One area where Crossant wants to grow his business is the circle track market. Though the typical circle track customer doesn’t spend as much money on an engine as a drag racer or street performance customer, he spends it more often.
"Drag motors last too long. A drag motor might go 800 runs before it needs to be redone. But a circle track motor might only last a couple of weekends. A guy will go out and chew up his engine one weekend, and want you to rebuild it for him in time for next weekend’s race. Then he’ll be back in a few weeks and want you to do more work on it."
Crossant said he’s also doing more import engines such as four cylinder Hondas for street performance applications, as well as 3.8L Buick V6s and 4.3L Chevy V6s.
"At some point we’d like to start our own performance engine program to compete with the crate motors and engine kits Chevy and Ford are selling. People want horsepower and are willing to pay for it. My son wants to build a website to promote package motors in the 350 to 360 hp range on the Internet. We’ll probably start with 302 Fords and 350 Chevy V8s. These are the two most popular motors for us. We used to do a lot of Chryslers for drag racing, but the demand for Chrysler motors has dropped off in our market."
Round and round
Rudy Stafford, manager of Gaerte Engines in Rochester, NY, said his shop’s primary performance niche is building engines for open wheel oval track racing including sprint cars, World of Outlaws cars, and USAC Midget cars. Gaerte also builds engines for NASCAR Late Model Stock cars and IMSA teams, Champ (Silver Crown) cars, Modifieds of all sorts, and even dragsters, tractor pulls and boats.
Gaerte Engines has been in business since 1969. Founded by Earl Gaerte, the business now employs 36 people and occupies a full block in Rochester including the machine shop, parts warehouse and new 21 x 75 ft. showroom. Shop equipment includes everything you’d normally find in a full service shop, plus three dynos and a CNC machine for head work.
Stafford said 1999 has been a good year for the performance market. "Anybody who couldn’t make money this year might as well get out of business," he said.
Gaerte sells both engines and parts. Their website at www.gaerteengines.com gives complete details about their ready-to-race, dyno-tested sprint engines, dirt late model engines, four cylinder midget engines, dirt Champ engines and late model stock flat-top piston engines. Their website also includes a technical Q&A section of frequently asked questions (FAQs), ordering information for their parts catalog, and many photos of different kinds of work being performed in their shop.
The starting price for a complete 360 ASCS sprint car engine is $17,600, and $30,000 for a 410 World of Outlaws engine. Such engines include Rodeck or Brodix aluminum heads, or Gaerte race prepared castings that are ported and polished with titanium valves, an LA Enterprises steel crankshaft, Wiseco or JE racing pistons, Crower or Carrillo rods, Total Seal piston rings, Michigan H bearings, Gaerte custom camshaft, Crower, Crane or Gaerte rollers and rev kit, Summer Brothers cam drive, Kinsler fuel injection and MSD Pro Mag or French Grimes Twin Magneto ignition.
Four-cylinder midget engines start at $18,600, and include a Gaerte-Rodeck aluminum block with 4.00" bores, steel crank and Kinsler fuel injection. Stafford said the hardest part of the business is trying to keep up with their customers’ demanding schedules. "Most racers don’t plan ahead very well and need everything yesterday. Meeting their deadlines is always a challenge, but in this business it’s a necessity."
More than able
Ray Krebill, shop manager for the Able Company in Grand Rapids, MI, said his shop does custom engine building on everything from Briggs & Stratton engines to Cummins diesels. Only about 20% of the shop’s total volume is performance work, and most of that is import engines.
"Our owner, Ray Able, races a Triumph TR4 so we do a lot of Triumph, Volkswagen and Mitsubishi engines for road racing and street cars," said Krebill. "We used to do some smallblock Chevy engines for circle track customers, but most were low budget engines and were more hassle than they were worth. We found that catering to the more exotic import engine customer has been more profitable for our business."
Krebill says his shop’s pricing policy is a combination of package pricing and hourly labor. Performance work overall is more profitable than stock engine building, but it is also much more time consuming. "You have to pay close attention to detail and make sure everything fits perfectly," Krebill said.
The Able Company has been in business since 1982 and has four employees. All machine work except crankshaft grinding is done in-house. A sideline business, Snyder Racing Enterprises, sells performance parts.
Chevys, Chevys, Chevys
Lingenfelter Performance Engineering has carved out a niche for itself in the Chevy performance market. Located in Decatur, IN, Lingenfelter employs 37 people in a state-of-the-art facility that includes two engine dynos and a chassis dyno. The company got its start building drag racing engines back in the 1970s. Today, most of their work falls into three areas: building Chevy racing engines; building Chevy street performance engines; and doing research and development work for Chevrolet and other OEMs.
Jason Haines, shop manager at Lingenfelter, said performance engine building is a high profile business and that the employees take a great deal of pride in the work they do.
"Building performance engines is more time-consuming than stock work, and every motor is different. The development work is never done either; people always want more power," Haines explained.
Complete descriptions of the company’s package motors can be found on their website at www.lingenfelter.com. These include LT1 and LT4 engines for Corvette, Camaro, Firebird and Impala SS. Prices for various 1992-’96 LT1 and LT4 Corvette packages range from $9,100 up to $15,750 depending on engine displacement and horsepower. A 383 cid 440 hp engine with 470 ft. lbs. of torque for a 1993-’97 Camaro or Firebird goes for $17,200. Such a motor includes CNC ported cylinder heads and hand ported intake manifold, forged 11 to 1 ratio pistons, steel crankshaft, custom hydraulic roller cam and a SuperRam intake manifold.
Lingenfelter’s website also has a page that lists sample performance figures for various engine packages. This is a popular marketing tool because it lists typical zero to 60 mph times, quarter mile elapsed times and top speed potential. The 440 hp LT1 engine package in a Camaro or Firebird, for example, should do zero to 60 mph in about 6.2 seconds, a quarter mile in 12.7 seconds, and have a top speed potential of 180 plus mph.
Haines said Lingenfelter’s focus on developing the performance potential of Chevrolet V8s has enabled the company to establish itself as a leader in this segment of the market. And although there is growing interest in import engines, the company has no plans to change direction anytime soon.
"Development work and racing will continue to carry us into the future because these two areas are less sensitive to economic swings than the street performance market," said Haines.
The performance engine building market has certainly been good the past couple of years, and how long that winning streak will continue is anybody’s guess. But one thing’s for sure – those who have found their niche in this market have every intention of staying right where they are.