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Drew Industries targets third-party buyers, eyes steel alternatives

Keywords: Tags  Drew Industries, Lippert Components, Kinro, Jason Lippert, earnings, first quarter, 2013, extrusion material substitution

CHICAGO — Drew Industries Inc. is increasingly selling aluminum extrusions to third parties as well as looking to offer aluminum alternatives to steel parts, an executive said.

The White Plains, N.Y.-based parts maker for the manufactured home and recreational vehicle (RV) markets has been selling aluminum extrusions to outside parties "going back a few quarters," according to Jason Lippert, who serves as chairman and chief executive officer of Drew subsidiaries Lippert Components Inc. and Kinro Inc. Lippert will become Drew’s president and chief executive officer when Fred Zinn retires May 10 (, Feb. 13).

"We’re finding that there are customers out there looking for a good supplier," Lippert said during a conference call with analysts May 3. "It’s opened some doors for us. There are so many industries out there ... that use aluminum extrusion components."

Lippert Components announced last year that it was ramping up three aluminum extrusion presses at its Elkhart, Ind., facility (, May 2, 2012).

"We’re definitely taking care of the aluminum products within our own operations," Lippert said. "We’re doing the parts that we want to do, the parts that seem to be the most profitable."

In addition, the company is also looking to replace steel parts with aluminum ones when the switch makes sense, he said.

That’s especially so in cases where the company can create an extrusion capable of replacing a steel part that might require more labor, Lippert said. "You can just do more with aluminum shapes. You can create a shape for just about anything in aluminum," he said.

Drew’s extrusion and axle products are gaining market share in the specialty trailer markets, Lippert said. Overall, supplying aluminum extrusions to industries adjacent to Drew’s current markets or even finding new industries to supply is a "huge opportunity for us going forward," he said.

Separately, Lippert noted that Drew is in a better position to consider potential acquisitions now than it was previously, given that past acquisitions and structural changes within the company have largely been digested. "There are acquisition opportunities on the table now," he said. "This will be a good year for us to do it, if there are any ... (that) have the value to be worthy of us considering it and pushing the button."

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