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M&M Cylinder Heads alters business model to survive volatile times for machine shops
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Hayward, Calif.-Engine rebuilders are an endangered species, due primarily to the fact that it's become more economical for people to swap out blown engines for new crate motors instead of rebuilding them, said Mike Brewer, owner of M&M Cylinder Heads, a full-service automotive machine shop in Hayward, Calif.


"Fifteen years ago, there were 40 or more machine shops in this area," Brewer said.  "Now we have just four.  Most of them had to close their doors because this industry as a whole has been hurting.  The cost of business has gone up, but the workload hasn't increased along with it." 


Consequently, M&M has had to lower its prices on engine rebuilds to be more competitive, Brewer said.


"We've been forced to go up against the crate engine market," he said.  "We've had to hold our prices down to compete.  When a customer can get a Chevy 350 crate engine for around $2,000, it makes it tough.  If we want to have any chance of getting that business, we have to come in at a lower price."


M&M opened its doors in 1977, which makes it one of the oldest automotive machine shops in the Bay Area, Brewer said.  Brewer, 50, started the business with this late father Monty and then took over the operation in 1983.


Mike Brewer, owner of M&M Cylinder Heads, has been rebuilding engines since 1977, which makes his one of the oldest machine shops in area."My dad was working for World Airways rebuilding aircraft engines at the time and I had just graduated from an ROP program after completing courses in basic repair and engine rebuilding," he said.  "In 1977, the economy was sluggish and I was having trouble finding a job as a tech, so I started doing valve jobs for local dealerships and working out of the basement of my father's house."


M&M grew quickly, and one year later, father and son moved into a 1,200-square-foot shop, Brewer said.  In 1979, the pair purchased their current building; a 4,000-square-foot facility with a complete machine shop and a small wholesale parts department.


Despite the changes in his industry, Brewer has been able to turn a nice profit every year since taking over the business, he said.


"Our business grew every year until about 2000, when we started to plateau," he said.  "Cars are disposable now and people are getting new ones instead of rebuilding or replacing their engines.  But, we've changed our approach a little as times have changed and have been able to stay ahead of the game."

Machinist Donald Mikesell rebuilds connecting rods at M&M Cylinder Heads.
In 2001, Brewer said he had to change his business model and started to concentrate on doing more cylinder head work and fewer rebuilds.


"Rebuilds used to be a larger part of our business, but now we do about 12 every month and have focused more on doing heads," he said.  "It's more profitable and there just seems to be a larger market for it."


In 1999, Brewer added an additional income stream when he started selling wholesale engine parts and became a distributor for Federal-Mogul, he said.


"It just goes hand-in hand," he said.  "If we do a valve job for a shop, we can sell them the gaskets and the head bolts at a wholesale price.  Although it's not a huge part of our business, it's a source of profit for us and a convenience for our customers."


Big-ticket performance engine work has always been a reliable source of business for M&M, Brewer said.

Machinist Joe Christian rebuilds a cylinder head at M&M Cylinder Heads.
"We work on a lot of high-end and racing engines," he said.  "Aston Martins, Bentleys, Rolls Royces-we've done them all, including a $40,000 small block engine for a Chevy autocross car.  We like doing the exotic specialty work and we've built a reputation for being very good at it."


M&M employs three machinists and provides every type of machine work and engine rebuilding, including cylinder head work, performance engine rebuilding, welding, lathe work, and mill work. 


"If you can do it to an engine, we do it," Brewer said.  "From crank work to block resurfacing, we've done it all more than a few times in 31 years.  We work with all of the top vendors and parts suppliers in the industry-from Clevite to Melling to Edelbrock and Speed Pro.  In this age of specialization, we like to think of ourselves as a one-stop, full-service machine shop."

   
Nearly half of M&M's workload consists of doing cylinder heads for repair shops, Brewer said, while 30 percent comes from dealerships and the rest is derived from walk-in retail customers who usually want performance work.


"We have a very good relationship with our shop customers," he said.  "We provide them with fast service, because we know that time is money for these people.  We will pick their engine up, rebuild it and bring it back to them and can usually turn the job around in two days."




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