AFR acquired by equity group

[chilly460]

I've seen this announced in a few places, sucks to see it happen as I always thought AFR made a quality product (even though none for FE).  Sometimes these PE firms leave well enough alone, but majority of the time they start looking at the margins, and the only way a quality head like AFR can go is down.  Cheaper valves/locks/springs, larger stepover spec on the CNC'ing...they'll start chipping away at the quality IMO.  Seems like much of the aftermarket is going this way as the old brands are bought up.   

"Air Flow Research is excited to announce that Taglich Private Equity, LLC (TPE) has acquired AFR. TPE is a lower middle-market PE firm that specializes in recapitalizations, management buyouts, and majority equity investments, targeting manufacturing, business services and consumer products companies. Taglich looks to partner with management teams that can take advantage of their expertise and background in order to optimize their company's growth potential and create long-term value.

AFR’s management team and employees will continue to operate out of its Valencia, CA facility, continuing to provide high quality, performance cylinder heads, service, parts, and machining associated with the AFR brand. Nothing will change; it will be business as usual. As President, Board Member and significant investor, Rick will continue to be involved with the organization, ensuring the foundation that his family and employees have built over the past 50 years will flourish under TPE’s guidance.

Taglich and AFR are excited about the growth prospects both organically and through future acquisitions of other aftermarket performance companies."

[gregaba]

I am afraid you are right. In a couple of years you will see a Made in china tag on the box's.
Greg

[Diogenes]

You are correct, unfortunately. Private equity firms almost always bleed a company out. Fram/Autolite was owned by a private equity firm for many years, now they are owned by the Trico Group. During PEF ownership, Fram/Autolite lost an immense amount of market share. We can debate all day long about the quality of Fram filters (Extended Guard is a good filter-XG8A, though I use Motorcraft or Wix), but there is no denying they were once a top selling filter. I believe Autolite is still doing pretty well, though they moved most, if not all manufacturing elsewhere. Sadly, AFR will likely go the same route. Much like Curtis-Mathes, Blaupunkt, Westinghouse, and countless other brands, they will inevitably be sold off for their name recognition.

[chilly460]

Now this was rolled out last year, but you have to wonder if Taglich already had influence, but AFR already introduced a line of import castings.  Just hate to continue seeing it across the industry, as a "niche" market it's one of the last to see the manufacturing head offshore, but it's becoming more commonplace as profits are chased.  I imagine this "offshoring" debate is beating a dead horse, been discussed many times already here.   Main issue is I hate to see a top level supplier like AFR lose its way.  If you follow what they did with the 385 series head, following the excellent SBF heads that have been around for years, I was sort of hoping they'd somehow step into the FE ranks at some time.  Doubtful now. 

[gt350hr]

  "Nothing will change , it will be business as usual"   Poo poo de toro!!!!  It may not be right away but it WILL change. I was part of a ''corporate buy out" in the automotive performance industry. YES for about five years it was ALL SMILES until the ice began to melt and the noose began getting tighter. Gross income dropped by OVER 50% before "another" investment company "rescued " (NOT) it. It continues to falter. Many "single owner" businesses and being bought out by investment companies these days. If you lose the creator(s) the creativity is most often lost as well. It's hard to be a visionary sometimes when your name isn't on the building. MANY "acquired" companies are currently not able to produce parts. Try to get something from Edelbrock or Dart. Both are acquired companies.

[Rory428]

I hate hearing stuff like this. I have had 2 pairs of AFR aluminum heads on my SB Fords, very nice, high quality pieces, out of the box. It seems when "bean counters" get more involved, things go downhill rather quickly. I don`t know if  that is what happened with MSD, but the MSD 6T that I installed in my Fairmont 30 years ago still works flawlessly, but over a period of 10 years, I had 2 later MSD 6ALs fail, as well as a pickup coil in a MSD billet distributor. I have heard similar stories with Richmond gears, Holley carbs,Hurst shifters, etc. Maybe BarryR can chime in out Sealed Power/SpeedPro/Federal Mogul.

[cleandan]

While we can guess, it would be nice to know why AFR was purchased.
Maybe the founders wanted to retire and nobody was in line to take over, or make a viable purchase at this time.
Sometimes the purchasing company does want to add them to the overall brand potential and they do desire to keep things good.

Often times the purchasing company does so in order to further its profit margins in the short term, while having no real long term goals, which usually leads to future closings.

The profit magins can come in different ways.
They continue selling on the brand name while lowering production costs in other ways.
They use the "loss" and "depreciation" as a method to make profits from other held investments.
They simply bleed the company dry and when it finally fails, sell it. With a company like AFR they could keep making the exact same products as before but never again invest a single cent in any part of manufacturing.
As the molds wear out the product suffers until eventually they can no longer make a useful product with the tooling on hand...and things get shut down for good rather than invest in new tooling.

We have seen this happen before and rarely does it work out well for the once great product.

The really unfortunate part happens down the road.

Take FRAM as an already mentioned example.
I worked with industrial mechanicals for a long time. We had so many troubles directly because of the way FRAM went downhill after being purchased that I am hard pressed to purchase anything with the FRAM brand name.
The investment firm who made FRAM "more profitable" ruined FRAM for me, and others, forever thus making them zero profit because I am not buying anything with the name FRAM on it....it is just not worth the risk in my opinion.

Nothing lasts forever.

Maybe, just maybe, this will result in AFR tech being used to make some other good quality heads....just not here in the USA.
Maybe AFR will venture into the FE head market and make a very good product, even if it is made in the CHINA factory (pronounced C. H. eenah for fun)

[gdaddy01]

like Richmond Gear ? 

[c9zx]

I looked up Taglich, they make SOCKS, and other things. Doesn't look good for AFR. Here is a link. https://taglichpe.com/portfolio_full.php  Chuck

[TomP]

Socks don't have too much in common with cylinder heads.... but maybe they heard testimonials from customers who say that AFR heads made a pleasant difference when you put your foot into it? 

[c9zx]

Good one Tom! Chuck

[gdaddy01]

funny , needed a good laugh after reading Brents post about people walking around at night .