Behind the wheel at Cardone Industries

Two years ago, the Philadelphia family that started Cardone Industries in 1970 decided to pack it in, putting its automotive-parts remanufacturing business up for sale.

A suitor was found and the traditional lovey-dovey talk between buyer and seller made its way into a press release announcing that TPG Capital Inc. would close the acquisition by Dec. 31, 2011.

Sellers' remorse must have hit hard, because three weeks into 2012, Michael Cardone Jr., the son in the father-son team of founders, broke the engagement, booted TPG, and went out looking for a new chief executive.

These days, that CEO, Kevin Cramton, is the one doing the buying - snapping up the assets of competitors that didn't survive the recession.

Question: First of all, what is automotive-parts remanufacturing?

Answer: It's basically your original part that we have manufactured. In some cases, that means we've corrected design errors. The reason some of these parts fail is that they haven't been designed correctly. So we reverse-engineer every part.

Q: Then what?

A: Because we're not re-forming metal, we're not re-forming plastic. We're not using the kind of materials that [make up] 60 percent of the cost of a new part, which allows us to price that component significantly cheaper than a new part.

Q: Does demand grow during a recession?

A: In an economic downturn, people do tend to hold on to their cars more. But at the same time, that doesn't mean that people necessarily do all the maintenance on everything.

Q: And now?

A: We're seeing some pent-up demand. People are feeling not great, but a little bit better, so they are beginning to do maintenance they've deferred.

Q: Like what?

A: Brakes - you can defer six to nine months. They don't sound great, but they're stopping me.

Q: Your biggest seller?

A: Brake calipers. We make eight million calipers a year.

Q: What's the greatest threat to the business?

A: Low-cost suppliers coming from China and Asia who are bringing in new copies [of original equipment]. They are competing against the original equipment remanufacturing products that we make on price, not quality.

Q: You have facilities in Northeast Philadelphia and another in Texas. How would you compare the business environments?

A: They are all about jobs in Texas. They come to us with a package. Here's what we can do for you - education, training, tax, and I just don't see that effort here. I told the mayor that.

Q: You are the largest manufacturer in Philadelphia. You used to employ 4,200 here; now there are 2,200, as some work went to your Mexican plant. Any chance you'll move more Philadelphia jobs to Texas or Mexico?

A: Consistent with our standard business practice, we continually evaluate all our business operations to assure Cardone remains competitive.

Q: You've spent most of your career working in the automotive industry. What's parked outside?

A: A Mustang 5 liter [2011] convertible with Cardone calipers. It's unique in the parking lot. It's black with a red interior. It's beautiful. It's my baby.

Q: Do you take your baby out for a lot of spins?

A: It's great for cruising. I basically take the top down. I grew up with Motown music, so I pick out my favorite Motown artist and I crank it up going through Main Line neighborhoods.

Q: You love that car. How much did it cost?

A: $55,000 - it has as much muscle power as a Porsche at $100,000.

Q: A bargain!

A: It's a poor man's muscle car.

Title: Chief executive, Cardone Industries, |since August, 2012.

Home: Bryn Mawr.

Family: Wife, Faye; children, Nathan, 27; John, 24; Claire, 22; Rose, 12.

Diplomas: Michigan State University, bachelor's and master's in business.

Resume: Rose at Ford Motor Co. to lead global mergers. Directed portfolio firms for an investment holding company. CEO of Revstone Industries,

a major auto

component supplier. EndText

Headquarters: Northeast Philadelphia.

Other locations: |Texas, California, Canada, Mexico.

Business: Automotive- parts remanufacturing, 45,000 items, including axles, calipers, pistons.

Founded: 1970 by father and son, Michael and Michael Cardone. 

Ownership: Privately held. Third-generation Michael Cardone is

now president.

Employees: 6,000, 2,200 in Philadelphia.

Revenue: Not available, $900 million, estimated.EndText

See Kevin Cramton's

human-resources challenge

at Inquirer.com/jobbing EndText

215-854-2769 @JaneVonBergen