03 May IAC’s Jim Kamsickas is Selected as Champion of the New Economy
Jim Kamsickas is one of five CEOs selected as a Champion of the New Economy. In its third year, and created with the goal to inspire growth in our region, this program is recognizing business leaders in the metro Detroit area who are contributing to moving our economy forward. A panel of qualified judges from WJR-Radio, DBusiness Magazine and Junior Achievement of Southeastern Michigan selected this year’s five Champions. A ceremony will be held in downtown Detroit on May 9 to recognize the five Champions of the New Economy. Please click here to read the feature article published in this week’s edition of DBusiness Magazine.
IAC’s Jim Kamsickas is Selected as Champion of the New Economy
James K. Kamsickas has guided IAC Group through the gyrations of the automotive industry, including the 2008 global financial crisis, with a manic focus on discipline. Since it was formed in 2006, IAC has assembled more than a dozen distressed companies and integrated the operations into a leading supplier of interior components and systems. Customers include General Motors, Ford, Chrysler, Fiat, BMW, and Volkswagen.
How do you keep pace with all of the innovations in consumer electronics?
On the electronics front, the OEMs and their suppliers directly source the technology itself, and it’s our job to integrate that into the design of the interior as it relates to the instrument panel, consoles, and cockpits. All of the OEMs have different products and strategies, from radios to sensors to GPS, and our job is to make sure everything connects and looks great. If you take the (upcoming) Dodge Dart or the (2013) Ford Fusion, our job is to package all of those innovations and make sure the interior of the vehicle is a rich, comfortable environment.
Why has interior styling become such an important factor on the showroom floor?
Five years ago, vehicle interiors were down the list of OEM considerations regarding consumer offerings. It used to be exterior styling and engine performance (horsepower) drove most sales, along with the cost of the vehicle. But what the auto companies have learned recently is that the fit and finish of the interior is a major consideration for folks looking to buy. The research is coming from J.D. Power and customer feedback, and it shows interior craftsmanship is incredibly important to people. Before, the interior was largely made up of hard plastics with a shine, but now the focus is on soft materials like stitched leather, rich lighting packages, and wonderful instrument displays.
What do you attribute the change in demand to?
More and more, the average person is spending a significant amount of time in their vehicle. Here in North America, the suburbs are getting more populated and people are moving farther out. In emerging markets, there’s more traffic in urban areas. People see what others have, and they don’t want the plastic-and-shine. And younger buyers everywhere want all of the latest gadgets. Before, the OEMs didn’t focus as much on interiors; rather, it was on the best way to build a vehicle from a production standpoint. That’s totally changed now.
What were your guiding principles during the 2008 global financial meltdown, and how do you manage the cyclical nature of the automotive industry?
We’ve had a playbook from the beginning, and we look at seven critical elements. We came into the business (in 2006) when Wilbur L. Ross, our majority owner, created IAC. He came from a history of assembling distressed companies in various industries, and in our case, it’s been (integrating) 14 different businesses (that have been acquired) over the last five years. When a downturn arrives, we already know what’s coming in terms of expectations. We didn’t know how bad 2008 would be, but one of our core missions when a new company is acquired is to eliminate inefficient capacity. We also work with organized and unorganized labor to find solutions, and we’re very disciplined in terms of our operations and goals. We have 76 (manufacturing) facilities globally, and our customers expect us to build the same quality vehicle in North America, Europe, and Asia. We spend a lot of time on operations, and you can’t over-leverage your balance sheet. With some companies, they look for the next big thing — but in our industry, with the capital that’s required to invest in new programs, you can’t keep leveraging your business in that way. One miss and you could be out. So the way we operate is to make sure we have a strong balance sheet, very lean operations, and strong discipline.
What have you learned from IAC Chairman Wilbur L. Ross, and how often do you meet with him?
Like any new relationship, we spent a lot of time initially getting to know one another, understanding the foundation, and learning the expectations. Once you understand the playbook, the relationship — like any relationship of this type — evolves into quarterly meetings. Given that Wilbur is our chairman, I report quarterly to the board. Only a few people, like Wilbur and his partners, have played in as many distressed sandboxes. The beauty is nothing really fazes them. A lot of times, people panic in distressed situations. But here it’s nothing new. We stick to the basics, take out the unnecessary fat and waste, and make sure we have a good return. Wilbur just isn’t automotive, he also has an in-depth perspective in steel, coal, energy, and banking. So we have this wealth of business knowledge to tap into.