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The Great Crate Debate – Profit Potential From Packaged Engine Programs Actually Exists

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Right now I know of no other term that draws as much negativity among some engine builders as the term “Crate Motor.” It immediately brings feelings of sales lost.

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We all know the story. The customer sees his car project like one big plastic model. When it comes time to pick a rear differential, write a check. A wiring harness, pick a part number. Air conditioning comes as a kit in a box. What about the power plant? Crack the catalog and make your choice based on horsepower vs. cost. Plug and play.

And why not? A good half of the machine shops across the nation have discovered that they can be engine builders without being engine assemblers. Customers left with the choice of having an engine machined and then assembling it themselves versus buying a new or mostly new engine ready to go, see it as a no- brainer. Now, with backing from OEMs, race sanctioning bodies are looking for a similar “easy way out.”

Starting at the stock engine replacement level, buying a new engine from the O.E. manufacturer has always been an option. Unfortunately, today I hear shops tell  customers that this is a better option than rebuilding the engine in their car. Again, we have engine builders who are not building.

Production engine remans have seen a large drop in business over the years, but they have never stopped rebuilding and they will make a play for that exchange engine, not leaving the sale solely to the OEM.

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As a matter of fact, they are now making a play for their share of the crate market. They have core blocks and access to new aftermarket blocks. Either one can be run through their assembly line, fitted with new parts, and sold outright to a consumer looking to “plug and play.” Just look at the ads in the mail order books, positioned next to the O.E.M. crate motors and you’ll find a 383 or 496 cid crate motor with some generic name and a big horsepower number.

Exactly what is a crate motor? More than anything, it is an option. The term was originally applied to a “new in the crate” factory engine. The GM Performance catalog is famous for several versions of its popular V8s available to a consumer who wanted a factory new engine instead of a rebuild.

They could also buy a street legal performance or off-road race engine that was found in muscle cars and factory race cars. They could have all the good pieces, with factory engineering and tolerances.

Right alongside those, though, were some basic engines as well. We all remember the GM “Target Motors.” These economy-built GM 350s were sold by the thousands. Maybe a 275 hp 350, complete with a warranty, just in case the consumer wanted something new for the grocery getter.

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Today, both Ford and Chrysler have their offerings, from mild stock or base engines to wild Hemi headed or DOHC performance V8s.

These crate offerings have been very successful and will probably remain in the OEM parts catalogs for many more years. But the aftermarket does not have to sit still.

The term crate motor has a broader interpretation today and includes any engine you might order from a catalog, magazine, website, or even in person. If it ships in a box, it’s a crate. If it’s shipped outright without a core charge, that can be a crate motor as well. This has actually opened opportunities for everyone to get on board.

Pick a formula that’s repeatable. Verify your horsepower, create your marketing and you have a crate motor program.

Sometimes it is just that easy. The 425hp 454 in my ’32 coupe was purchased from a GM dealer many years ago. I don’t believe that motor ever saw a dynamometer, but since it fit the exact build of that 1971 454 LS6, it’s cataloged as a 425hp 454. This is the good news for anyone building such an engine. Repeat a known formula and you have your ad copy. If you build your own formula, you should have dyno sheets to back up your claim.

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There are many shops pushing a form of crate engine today. Some start with aftermarket blocks, promoting a complete new engine. Many have excess core blocks and just factor the value of the core into the selling price. I know of such a shop. They push three different horsepower rated 350 Chevys – 300, 325 and 350 hp crate engines with upgrades along the way, as well as a price increase for each stage.

The interesting part of their story is the conservative nature of their claims. Anyone looking at the bill of materials would note that with these components, each combination should make more power than claimed. In doing this, each customer feels they are getting more than what they asked for, especially when they opt for a dyno session.

This is rather clever in more ways than one. How often do you think customers want to deviate a little, trying to get more for their money? I believe the answer is most of the time. Well, this shop can easily accommodate that by moving the customer up to the next combination. Or, by producing dyno sheets from a previous build they can show that their combinations make more than they claim and can use this to keep the consumer at the price point they could afford in the first place. The little extra comes at no additional cost.

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There is another famous manifold, head and performance parts manufacturer who splits the difference between O.E. factory crates and aftermarket crates. They do this by buying base model GM crate engines and upgrading them. They replace the camshaft with a hotter version, the iron cylinder heads with performance aluminum heads and add on the manifold, carburetor and externals to give the consumer a hybrid build with all new parts.

Opportunities do exist in the crate motor market. It doesn’t have to be all negative. Besides creating your own program or engine, there could be some money to be made in upgrades and blue printing.

Now I’d be the first to admit that the consumer who’d buy an O.E. crate motor and rush it over to your shop to pay you to teardown, inspect and put it back together are rare, but it has happened. More likely, you’ll have an opportunity to help a crate owner get more power out of his engine.

Rarely does one size fit all, and no place is this more true than in camshaft selection. There are several camshaft manufacturers that have grinds geared for the crate market. These motors are nothing special, so the cam doesn’t need to be more special than to fit better, application-wise, than the cam that comes in the crate motor. The cams that come in these engines are a compromise at best, there are always opportunities to give the consumer more power, or more drivability, than they have with the stock bump stick. Beyond the cam, there’s the valve spring, cylinder head porting and valve work and maybe more compression to be had by milling the cylinder heads. Again, each application will present its own opportunity.

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Crates have been around for many years now. The engine that shows up at your door for a rebuild could have at one point been a crate motor. When someone talks about the opportunity to rebuild crates, what are they talking about? Generally, it’s the opportunity to rebuild another engine, with one exception: the sealed crate race engine from GM.

The so called “604” and “602” crate motors sanctioned by many racing associations may have found favor with some racers, but they do wear out and break. There is a need for shops that can rebuild these engines, but the hoops you’ll have to jump through may not make it worthwhile. You’ll have to be approved and post a sizable bond, which you lose if you’re caught cheating engines. The flip side, however, is building cheater engines.

I’ve spoken with several shops that have information about, or have actually built cheater crate motors. They tell me that everyone knows that sealed bolts are available on the Internet.  Of course, there’s more to know than that, but the stories are fascinating.

One builder showed me his exercise in building a cheater crate so he’d have a better understanding of what he’s up against. Once he discovered how easy it is to build a good, undetectable cheater, he realized just what a joke the theories around why sanctioning bodies are promoting these programs really are.

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Really, the crate motor is just a means to fulfill a need, or is another option. If we admit that the demand is there – and it is – maybe you can put together your own offering.

At the very least you’ll know what it takes to get verifiable horsepower. You should know what an engine like this might cost to build and what it markets for. With this info you’ll then have something to offer the potential buyer.

Maybe you’ll decide you don’t want to be part of the mainstream, or should I say Chevrolet, market because you’re a Ford or Mopar or import expert and already have a following. Maybe you have the cores that you’ll need for the blocks. Or, maybe not and you can choose to buy new aftermarket blocks.

Crate motors aren’t for everyone, builder or buyer, but they’ve always been there in one way or another. Exchange remanufactured engines have been around for many years, and a crate is just a deviation from that. Who can ignore the allure of a brand new engine or a brand new high performance engine option? We must understand this if we don’t want to close the door on any potential customer or sale. In a world full of choices we must be prepared for what the market is asking for if we want to participate.

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“To crate, or not to crate, that is the question. Whether its nobler in the mind to suffer the slings and arrows of lost sales and fortunes, or to take arms against a sea of marketers and by opposing them, end the loss?”

In the original speech, a despondent Prince Hamlet contemplates death and suicide. He laments over the unfairness of life, but sees the opposite as worse. It’s amazing how much Shakespeare knew about today’s engine building industry.

Action or inaction, we have choices. Nothing’s going to change if you don’t explore the potential of your own crate motor program or even ways to improve someone else’s. The opportunities are there and based on what some others are doing, there is a demand.

With changes in the marketplace happening all around us, and not a lot of them for the good, an idea like this may open some new sales opportunities for your business. But you’ll have to decide for yourself, is it “to be or not to be?” n

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