Keep Your Eyes on the Road Ahead! Non-Auto Revs Up
By Lynda Nolen, Bishop & Associates Inc.

In 2009, connector sales in the transportation, non-automotive sector totaled approximately $1.4 billion. Within this sector, interconnects used in RVs (recreational vehicles), ORVs (off-road vehicles), and other power sport equipment such as Jet Skis and other personal watercraft, motorcycles, and snowmobiles, accounted for approximately $475 million. Although fourth quarter 2008 and first quarter 2009 proved to be disastrous for this industry—particularly for manufacturers of RVs— the transportation, non-automotive sector is on the rebound.

Primarily classified as a luxury item, RVs, personal watercraft, and ORVs also provide a unique view of consumer confidence to the economist. As one of the largest discretionary purchases a consumer will make, the purchase of these types of items, are a clear signal that the economy is on the mend. When a consumer purchases large ticket items such as a basic ATV at $3,000 or a $500,000 Class A motor home, they make these purchases with the intent of enjoying them for years to come. With proper care and maintenance, most recreational vehicles will have a lifespan of more than 10 years.

ORVs
A significant and growing portion of the transportation, non-automotive sector is the ORV market. While sales for ORVs were down in 2009, this particular segment did not suffer as much as other segments. Supported by a number of global companies, manufacturers of ORVs include Arctic Cat, John Deere, Honda, Kawasaki, Polaris, Suzuki, and Yamaha. Over the last decade there has been an influx of lower-cost ATVs produced by smaller Asian manufacturers mostly geared toward youth models. These sales have not significantly impacted the revenues of the major players.

ORVs are divided into two primary types: the ATV and the side-by-side. The ATV, also called a “four-wheeler” or “quad,” is a four-wheeled vehicle designed to carry a maximum of two passengers with limited cargo. Designed as a multi-passenger off-road vehicle, a side-by-side is designed to carry a maximum of six passengers, in addition to cargo. Although both are designed to travel in rough terrain, the ATV, with its smaller wheel base and sharper turning radius, is preferred for extremely rough terrain conditions. Based on the type of tires these vehicles are equipped with, they can operate efficiently in snow, sand, mud, and ice.

The recreational vehicle market, in particular the ORV market, has been able to maintain sales even during adverse economic times due to the multiple roles these vehicles can play. PEI-Genesis is the manufacturer of Sure-Seal® Connections used in ORVs. PEI-Genesis' Engineering Manager Kent Carlson and Mark Baptista, internal application engineering manager, said, “Today’s recreational vehicles are not just used for fun anymore. Their unique capabilities and configurations have allowed them to become workhorses in many on and off-road applications. These rugged vehicles are used for everything from portable construction site offices to wilderness search, recovery, and rescue vehicles. They also are used by law enforcement agencies, including border and harbor security.”

Approximately one-third of all ORV sales are used in farm, ranch, and wildlife recreational activities, such as hunting, fishing, and wildlife observation. ORVs allow people to easily go where a car or truck can’t. They can be used to transport fencing materials, herd livestock, or transport that elusive 12-point buck. Because of their ruggedness and ability to handle extreme off-road conditions, ORVs have also made significant inroads in the military market, replacing many quarter-ton jeeps.

What do all of these activities have in common? According to Carlson and Baptista, “they absolutely require a simple, low-cost, rugged, sealed electrical system. These systems must be capable of reliably performing while being dunked, gunked, splashed, splooshed, and temporarily submerged in some of the wettest, coldest, and muddiest environments on the planet.”

As Carlson and Baptista explain, “To assist in that quest, PEI-Genesis’s Sure-Seal® Connector series uses a one-piece resilient body and rugged multiple moisture seals, making these connectors ‘a natural’ for applications where outside contaminants must be excluded. Sure-Seal is reliable and uncomplicated. Only two parts are required to complete a connector: the connector body and the contacts.

"Sure-Seal was developed to meet the Department of Transportation (DOT) safety regulations for connectors used in automobiles, and has been successfully used in a broad range of environmental applications where a small, low-cost connector is needed. These sealed connectors meet or exceed DOT requirements for shock, vibration, temperature cycling, saltwater spray and immersion, petroleum derivatives, and industrial gas, while ensuring low millivolt drop and low contact resistance.



"One of the more popular versions of the Sure-Seal for recreational vehicle use is the single circuit version. It works in many peripheral equipment applications where a single wire brings power to the device and the return is the chassis ground. Other areas of interest include modularizing systems that are subject to wear or damage. For example, an ignition key system that is damaged by contamination is replaced by simply unplugging the key switch part of the harness and re-plugging in a replacement. The alternative is to buy and replace the entire harness that runs throughout the vehicle, or to cut out and butt-splice a new switch. Much of the time, the vehicle harnesses are securely routed and installed to the frame.

"Tight spaces can be challenging to access with wire stripping and butt splicing tools—without causing possible damage to other parts of the electrical system. So, a little extra cost and forethought to modularize the harness will reap huge savings for future repairs and general maintenance of these mission-critical vehicles."

As the role of the ORV has changed, so has user expectation. Today’s ORV buyer wants a number of safety, convenience, and comfort options. Corey Schroeder, Molex’s industry manager focusing on the non-automotive transportation industry, said, “Customer convenience and comfort now play an important role in product selection. Customers are looking for ORVs equipped to play CDs, MP3s, WMAs (Windows Media Audio), and iPods. They are looking for systems that offer USB, SD card, direct iPod jacks, and HDMI ports. They want heated hand grips, windshield wipers, front and rear working lights, and beacon lights; electronic gauges (speedometer and voltmeter), electronic cargo box lifts, as well as the ability to attach a variety of implements or tools. All of these require some type of signal interface. Molex offers a variety of interconnects, including HSAutoLink™, Mini-Fit H2O™, and the Ultra-Lock™ Connection System to customize their ORV. By modularizing options, systems have the flexibility to meet a wide variety of customer needs.”

RVs
The RV industry hit rock bottom in 2009, shipping more than 45 percent fewer units than it did in the early 2000s. As it recovers, the RV market hopes to capture additional consumers with a variety of appealing and cost-saving options.

There are two distinct types of RVs: Motor homes, which, like commercial trucks and buses, are rated by class; and towed RVs or trailers, which include fifth wheelers. The most popular motor home category is Class A, followed by Class C.

Class A motor homes are manufactured by many companies, including Coachmen RV (acquired by Forest River Inc., a Berkshire Hathaway Co., in December 2008), Fleetwood RV (acquired by private equity firm AIP in July 2009), Gulfstream, Monaco Coach Corp. (acquired by Navistar in June 2009), and Winnebago. They are available with either gas or diesel engines and are built on a commercial truck or bus chassis.

Class C motor homes, which are generally manufactured by the same companies that offer Class A motor homes, are smaller in size and recognizable by their extended front end. Built on a cutaway van chassis, these motor homes offer greater fuel economy and ease of handling than Class A types, and generally are gas powered. In an effort to satisfy those who think bigger is better but prefer the extended front end of a Class C type motor home, many RV manufacturers are now offering a Class C+. Built on a Chevy, Ford, or International Truck chassis, these motor homes can be comparable in size and luxury to a Class A motor home, but cost substantially more than your standard Class C.

Interconnect opportunities among class A and class C motor homes are numerous. Schroeder said, “Similar to trucks and buses, connectors on class A and C motor homes can be found in engine and transmission control units, power distribution systems, gear boxes, lighting control systems, on mirrors and wipers, as well as in a variety of telematics, entertainment, and navigation equipment. They include sealed and unsealed in-line connectors, hybrid and power connection systems, solderless terminals, sealed and unsealed headers, and a multiplicity of communication type connectors, including Ethernet and USB.”


Two Molex connector series that focus on applications within the transportation non-automotive sector include the CMC connector and the MX150L Sealed Connector System. The CMC connector family is a sealed, modular, high-density connection system that is offered in both standard and power configurations. The connectors have an integrated locking-lever that ensures the connector and header is securely locked with an audible click. Designed for under-the-hood power train (engine control unit, gear box, and suspension controller) and body electronics (junction boxes, lighting control systems, and electrical doors), the CMC connector is available in three terminal sizes and can be color-coded to assist in visual mating.

Designed for the challenging, rugged, and harsh environment found in non-automotive transportation applications, the MX150L is an environmentally sealed connector system perfect for high power applications where vibration and water exposure is a concern. The MX150L Sealed Connector System features all-in-one plug and receptacle housings with pre-assembled mat and interfacial connector seals, providing significant applied labor and cost savings. The simple crimp, poke, and plug application eliminates the need to crimp individual wire seals.

As Class A motor homes become more and more technologically advanced, so do the number of connectors necessary to transfer power and signal. Today’s motor homes offer color back-up monitors and navigation systems that incorporate rear- and side-view cameras; they have information centers that continuously monitor on-the-road performance, power visors, iPod hook ups, keyless entry systems, wireless remote action spot lights, and endless entertainment and communication applications.

RV manufacturers are incorporating “green” technology in many of their units. Although this primarily includes manufacturing the RV from lighter weight composite materials, thus reducing overall weight and increasing fuel efficiency, it also includes such things as incorporating fuel cells, solar panels, and using wind power—all features that will require additional connectors.

Solar cells for RVs are geared more towards Class C type motor homes rather than Class A. The tremendous amount of power necessary to power the vast array of electrical and electronic equipment found in Class A motor homes does not make solar power a viable option for primary power. But for many of the Class C motor homes, solar power can be a great alternative to a noisy, smelly generator, as well as allow them to travel farther off the beaten path. Connectors used in RV solar systems include terminal or barrier blocks, battery terminals, communication ports (RJ45, RS-232, or other), and single or “Y”-type photovoltaic connectors.

Other Power Sport Equipment
In addition to ORVs and RVs, this sector also incorporates personal watercraft, snowmobiles, scooters, and motorcycles. These segments were also negatively impacted by the 2008-2009 downturn.

The PWC or personal watercraft segment was probably the hardest-hit segment of this sector. Dominated by Bombardier, Kawasaki, and Yamaha, the industry hit a sales high of approximately 88,000 units in 2006 and has spiraled downward ever since. With the economy loosening up in 2009, many had hoped they would see some type of rebound, but unfortunately, the spiral downward continued in 2009, with unit sales of around 49,000. It has been predicted that even as consumers enjoy greater discretionary incomes in 2010, sales will remain relatively flat.

On the brighter side, a surprising fact to many was the number of snowmobiles sold in 2009. According to the International Snowmobile Manufacturers Association, sales of snowmobiles in 2009 were only down approximately 11 percent. This was an even greater surprise, considering that approximately 75 percent of snowmobiles are sold in North America, with the balance sold in Europe. Much of this has been attributed to the return to normal snowfall levels in many parts of North America, after years of droughts, and to improved product offerings.

Depending on what part of the world you live in, a motorcycle can be either a recreational vehicle or a primary source of transportation. In areas such as North America, Eastern Europe, and Japan, where most families own at least one automobile and public transportation is more readily available, the motorcycle is classified as a recreational vehicle. This concept is heavily reinforced by the overall 2009 decline of motorcycle sales in developing countries. However, in countries where motorcycles act as a primary mode of transportation, 2009 sales were actually up slightly. Because of the differences in market types, motorcycle connector content is dependent on what market it is geared towards. Motorcycles and scooters manufactured for consumers in developed countries have higher connector content due to greater engine sizes and consumer desired options. This is also reflective in their higher selling price. Motorcycles and scooters manufactured for developing countries are generally smaller, cheaper, and equipped with fewer options, and in turn, incorporate less connector content.

Future Growth Factors
These factors will influence growth in the transportation, non-automotive sector:

• The introduction of electric vehicles in the ORV market: In 2009, Polaris introduced the Ranger EV, the first electric side-by-side vehicle in the industry. In addition to side-by-side vehicles, all-electric ATVs could entice consumers turned off by the noise and noxious fumes emitted by traditional ATVs.

• As Asian manufacturers of ORVs improve their products, major ORV manufacturers will be forced to reduce costs to maintain market share. 

• As the population continues to age, it is anticipated requirements for low-emission vehicles in planned communities for intercommunity travel will increase.

• With over 79 million Baby Boomers on the verge of retirement, experts anticipate sales of RVs to rise steadily over the next decade.

• Although sales of snowmobiles were down only 11 percent in 2009, industry analysts predict the snowmobile market will continue to contract, even as the economy recovers a bit in 2010 and 2011.

• Escalating fuel costs will continue to plague this market sector. Manufacturers, in an attempt to capture or maintain market share, will continually be forced to find ways to increase performance, while reducing overall operating costs.

• The PWC market will remain flat in 2010, with many dealers still trying to move 2009 inventory.

• In 2010, all new snowmobile models must meet phase 2 of the rigid EPA emission standards established in 2002. It will be interesting to see if the new engines designed to meet these specifications will truly reflect an improvement in quality, and if consumers are willing to pay for these improvements.

• The 2009 introduction of the world’s first flex-fuel motorcycle by Honda should help to increase sales in countries where flex-fuel technology is already a dominate factor in vehicle selection.

• As the number of automobiles in developing countries like China (the world’s largest motorcycle and scooter market) and India (the world’s second largest motorcycle and scooter market) increase, sales of motorcycles and scooters will decline.

• A fairly new entry to the market, the electric bike, may impact the sale of gas-powered motorcycles and scooters. At least one research company, Pike Research, predicts “worldwide sales of electric bicycles, motorcycles, and scooters, between 2010 and 2016, will top 466 million.”

Lynda Nolen Product Specialist, Bishop & Associates Inc. Lynda Nolen has been in the interconnect industry for more than 30 years. She has worked in sales, sales management, marketing, and product management for such companies as TRW Electronics Components Group, Sunbelt Components, Cinch Connectors, Arrow Electronics, PEI Genesis, and Delphi Interconnect. Nolen has extensive experience in competitive cross-referencing, drawing, web and catalog review, new product introduction programs, harness and connector assembly programs, account management, and customer service programs. Lynda received her bachelor of arts degree from Roger Williams University in Rhode Island, and has completed various electrical engineering courses.