SPECIAL REPORT: CRISIS MANAGEMENT

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How motorsports shops and suppliers are responding to a novel coronavirus that is rewriting many businesses’ rulebooks.

We were all ready to race. Schedules for the 2020 season were set. Cars were prepped. Trailers were stocked and loaded. America had entered a long period of sustained economic growth, and times were good.

Then came the coronavirus.

By the middle of March, most businesses had shut their doors, entire racing series were halted, and millions of people throughout the nation were locked out of their offices and relegated to working in bedrooms, studies, and kitchens amid the din of children, spouses, and fast-food deliveries.

Our whole world had been flipped and spun into the wall.

But we had to continue. That’s what racers do.

The emotions, attitudes, and needs of people swept up in this crisis are as varied as the people themselves. Some have cautiously inched along as best they can, using recommended means of protection to limit their risk and give them at least slight peace of mind. Others have largely disregarded the crisis and pushed ahead unfazed, with little concern for mitigating measures.

To get a handle on these widely varied responses and how they’re reshaping the racing and performance industry, we recently reached out to a number of shops and suppliers. Their thoughts on the crisis and how they’re dealing with it offer illuminating insight on how varied our industry really is.

And how resilient, too.

Open For Business?

With states left to decide for themselves how best to respond to the pandemic, the resulting regulations have been inconsistent and patchy. Some states were completely locked down except for “essential services.” Other states operated with relatively few official edicts. Given those two extremes, there has been a great deal of latitude and variation within what’s actually permissible for business owners.

And even for companies that were restricted by a state-mandated shutdown, the decision on whether or not to stay open included gray areas. Although auto racing may be considered “non-essential,” at least in the spirit of most regulations, it nonetheless falls under the general umbrella of automotive parts and services. Therefore, most companies in our industry technically have been allowed to operate even in states with total shutdowns.

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Some companies, especially those that also make products for non-racing clients, have reported little to no change in production during the pandemic. “[We have] been running at full employment and full capacity,” said our source from Champion Brands.

At the same time, for the most part there appears to have been very little actual enforcement of shutdown regulations. And so, ultimately, the extent to which businesses have remained operational during the shutdown has basically come down to what their owners felt was prudent in their unique, individual situations.

“I never closed,” said Bernie Stuebgen of Indy Race Parts, Indianapolis, Indiana. “We weren’t necessarily allowed. We just didn’t turn the ‘Open’ signs on. I don’t really believe in a whole lot of this, honestly.”

For some businesses we contacted, shutdowns simply didn’t apply to them. “We produce essential goods, not just for racing, but for other industries as well,” said William Smith of Smith Systems, Brevard, North Carolina. “So we have to keep on producing during this time because our equipment goes into heavy machinery that moves goods and distributes things in mines, railroads, etc.”

The Waiting Game

Aside from the question of whether businesses could actually open, there was a more pressing concern—was there even any business to conduct? Soon after the crisis struck, most public gatherings were canceled. Racing ceased for the time being. And in one quick stroke, the lifeblood was sucked out of some businesses.

“When this all hit, it was just full steam ahead, normal springtime racing,” said Pancho Lawler of Pancho’s Racing Products, Hanover, Pennsylvania, when we spoke in May. “And then ‘boom,’ it stopped. So we got caught up on projects, redoing the showroom, stuff like that. But a month into it, it’s really tough to see people gone because there isn’t any racing.”

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One of the most important considerations in maintaining a safe workplace is assessing the health of employees. Some businesses have instituted mandatory temperature checks, while others are asking workers to self-monitor their health. Photo courtesy of Callies Performance Products.

Curiously, while retail stores like Pancho’s have seen business drop off sharply, other retailers such as Indy Race Parts haven’t experienced the same harsh effects. “In mid-April or so, we actually started getting a little bit busy,” said Stuebgen. “As time went by, and people started to feel like they’re going to go racing at some point, we actually have become busier and busier. This week has been crazy busy.”

And, for at least one race-car fabrication shop, the effect of the shutdown ended up representing more of a shift in demand than a halt or even a slowdown. Instead of customers buying consumables, Knoxville, Tennessee-based Warrior Race Cars has been selling more project-based parts, as racers hunkered down in their garages and prepared for racing’s eventual return.

“I’ve sold more stuff in the past six weeks than I normally do this time of year,” explained Mike Nuchols. “But it’s front suspension kits, new shock packages. Random stuff for this time of year.”

Meantime, companies that also make products for non-automotive businesses seemed to accept that the motorsports side of production was temporarily on hold. For them, staying open is the order of the day, as they continue to serve their non-racing clientele. “Our production has been running at full employment and full capacity,” said Karl Dedolph of Champion Brands, Clinton, Missouri. “It isn’t just racing products we’re running. Work we do for other industries is the biggest part of our business. They continue to order.”

Playing Keep Away

For businesses that have stayed open—or plan to resume operations in the near future—the question then becomes how to navigate the myriad challenges presented by the coronavirus. One of the most important considerations in maintaining a safe workplace is assessing the health of employees. Most companies have adopted official policies to keep those who are sick with COVID-19 from entering the workplace.

But within that general necessity, the range of measures varies widely. Some companies have instituted mandatory temperature checks for all employees entering their facilities. Others have taken a less formal approach, instead asking employees to simply monitor their overall health and act responsibly.

“We aren’t taking temperatures before people come into the facility,” said Smith. “Primarily because so many people are asymptomatic, it doesn’t make much of a difference. They can still spread it. But we’ve made it a requirement that if people don’t feel good, they can’t come to work. They don’t have to worry about if they have sick time or not. We’ll figure it out as far as paid time off.”

In addition to monitoring employees’ general health, businesses are wrestling with the need to maintain the recommended six-foot “social distance” between workers. The mixed shop and office environment of many facilities has posed different challenges for each. “The offices are a bigger problem than the manufacturing area,” said Heath Norton of Energy Manufacturing and Callies Performance Products, Fremont, Ohio. “Some of the people who are indirect, like engineers and admin, are staggering what times they’re coming in, so the offices aren’t so crowded.”

Most of the sources we spoke with said their companies have set up some form of work-from-home policy for office workers. For many, it’s been mandated companywide. But a number of other businesses have kept this aspect of operations informal, allowing office personnel to work from home if they choose. Salespeople and product reps in particular have adjusted their activities.

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Most of our sources told us employee morale and motivation during the coronavirus crisis remains positive, and throughout the industry people are staying strong, showing up, and getting on with the task at hand. Photo courtesy of Turn 14 Distribution.

Prior to the coronavirus crisis, extensive nationwide travel had been the norm for employees in these roles. But many companies have generally eliminated such travel for the time being. “We’re no longer using outside road sales,” said Dedolph. “They’re doing everything by phone. And anyone who traveled was home quarantined for two weeks after they arrived via an airplane or visited a customer.”

Although no one really knows what the near future holds for that aspect of their business, the travel situation is something companies are monitoring closely. “Right now, we’re not sending our salespeople on any travel,” said Smith. “Maybe later this year we would be comfortable with doing that. I don’t know. We’re scheduled to exhibit at PRI in December. At this point we intend on going, especially because we can drive. But if I had to put my guys on a plane right now, I wouldn’t do it.”

In contrast, shop workers in the companies we spoke with don’t seem to face as big of an adjustment with regards to social distancing. For the most part, the sheer scale of machinery and car projects has always incorporated a certain degree of distancing. Therefore, most of the changes needed to ensure six-foot buffers have proven to be minor in many shops. “This ‘social distancing’ stuff is already a way of life for us,” said Nuchols. “There are only two of us in the shop. We’re usually more than six feet apart anyway.”

Some companies have taken the additional step of dividing the workday into separate shifts in order to reduce the overall number of employees in the building at any given time. “By splitting into two shifts, we’re completely able to keep everyone apart from one another,” said Smith. “But we also did it to mitigate risk—in the event that one shift is exposed in some way, then the other can keep producing goods and shipping them.”

Along with these measures, most of our sources have tried to minimize the number of non-employees coming into the building. This, of course, is more difficult for retail stores. Other types of businesses have effectively ceased all non-essential activities and contact with outsiders.

“We’re no longer allowing outside sales companies to come and see us,” said Dedolph. “Everything has to be done via Zoom or Skype or Google Meetings or Facetime. And when trucks come in, the drivers don’t come into the factory.”

Not surprisingly, smaller businesses have tended to adopt a less formal approach to this aspect of the crisis, too. “I’ve been trying to just urge people to let me know when they’re coming instead of just dropping in,” said Nuchols. “And if they do, I just try to schedule throughout the day when they’re coming in—certain times, instead of everyone piling in all at once.”

Of course, short of locking folks up 24/7, it’s tough to regulate people coming and going. This has made for somewhat challenging situations in some businesses. “We had an outside person come by mistake to the shipping dock,” said Dedolph. “That person had recently just arrived on a plane from out of state and didn’t self-quarantine. So, as a precaution we sent three people on the dock home for two weeks, because they were in close proximity to this person.”

Behind the Mask

Along with the need to maintain distance, health experts have said face masks covering the mouth and nose can be an effective method of preventing virus transmission. Many employees choose to wear them, but few of the companies we contacted for this piece have an official policy requiring them. Other companies view them largely as a branding opportunity. “We don’t require anyone to wear masks coming into the store,” said Stuebgen. “But I do have Indy Racing Parts masks on the counter that people can buy. As a matter of fact, I’ve sold eight of them today.”

At the same time, most of our sources told us that employee morale and motivation during the coronavirus crisis have remained good so far. Throughout the industry, people are staying strong, showing up, and getting on with the task at hand, they said.

“Most everybody’s been pretty great and positive,” Smith noted. “I would say we’ve had less absences than usual due to everything since the start of this. We thought that maybe more people would be scared to come into work. But I think that splitting into two shifts kind of made people feel more comfortable and more separated from one another.”

Many workers are simply happy to still have a job, a routine, and a paycheck. Others are glad to be able to continue doing activities they love—not surprising among motorsports businesses. Still others see the coronavirus crisis as a mere hiccup in the larger scheme of things.

“I think everybody is really excited to get back to work,” said Norton. “Most of the people that work with us are race fans. They’re into us. It’s a lot of fun for us. Maybe they liked a week or two at home, but now they’re pretty much ready to come back. We had people texting every other day, ‘Can we come back?’”

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Some companies view protective face masks as a branding opportunity. Among them is Indy Race Parts in Indianapolis, Indiana, which offers masks for sale directly on its checkout counter. “I’ve sold eight of them today,” a company source told us in May.  

Nonetheless, it’s hard to say if this fighting spirit can be counted on indefinitely. Some managers are monitoring employee attitudes and morale very carefully, fully understanding that if worker acceptance and motivation wanes, safety might be compromised.

“We need all their buy-in,” said Smith. “We send out a letter just about every week to our employees, just letting them know our thoughts on everything, trying to help them understand why we’re making the decisions we’re making. That’s important. And at the same time, we encourage them to make really intelligent decisions outside of work. Because, if one of them decides to go to a party and potentially contracts this thing and brings it into work, it affects all of us. It affects their job, their colleague’s job, and even whether or not the company can continue to operate.”

Fortunately, none of the companies we spoke with reported any actual cases of COVID-19, at least as of mid-May. Perhaps it’s due to the preventive measures they’ve taken. Or maybe it’s because their region of the country was low risk to begin with. Or it could be just the random hand of fate dealing good cards. But that uncertainty is perhaps the most vexing thing about this situation. How much caution is enough? What’s the most responsible way to handle it?

Frustratingly, there are few, if any, exact answers. It’s a crisis that so far has been shrouded in unknowns, with more misinformation and guesses than definite facts.

And so, companies’ responses to it have ranged from fairly elaborate to relatively non-existent, underscoring the reality that there aren’t any absolutes to this crisis. It’s very personal, especially for smaller businesses. “I don’t run a kindergarten school here. I feel as though I shouldn’t have to govern anybody,” added Stuebgen. “You’ve got to do whatever’s right for you.”

 

SOURCES

Callies Performance Products

callies.com

Champion Brands

championbrands.com

Energy Manufacturing

energymanufacturing.com

Indy Race Parts

indyraceparts.com

Pancho’s Racing Products

panchosracingproducts.com

Smith Systems

smith-systems-inc.com

Warrior Race Cars

goddardwarrior.net

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