Nelson-based Pacific Insight Electronics produces parts for automakers including Ford and Tesla. How does this export success story compete with bigger rivals?
In one of a series of commercials by Lincoln Motor Co., actor Matthew Mcconaughey drives a sedan through city highways at night, looking contemplative. He delivers a script over music in his slow Texas drawl: “Sometimes you got to go back, to actually move forward...” The ads, which also feature Mcconaughey staring down a longhorn bull, have been credited for a spike in Lincoln sales and parodied by Jim Carrey on Saturday Night Live. The ambience may go over the top, but it's undeniable.
That atmosphere—at least inside the car—is created by a Nelson-based automotive parts manufacturer, Pacific Insight Electronics Corp., whose product lines include light-emitting diode ( LED) systems for interior and exterior applications. If you watch the commercials carefully, you'll notice a technology that Lincoln calls Embrace Lighting. “[Mcconaughey] gets in the vehicle, and the lights go on, then they work from front to back,” says Pacific Insight COO Ian Scott. “It kind of wraps around you. Everything lights up to your liking, and you can change that as you go.”
Other functions of the system include welcome lamps, which light up the interior foot areas as the driver steps into the vehicle, and lighting in the door panels and around cup holders. The lighting system incorporates Pacific Insight's other product lines: electronic modules that control features such as heated seats, steering lock, gauges and instrumentation; and wiring harnesses, electronic cables connecting the various components.
Besides Lincoln parent Ford Motor Co., Pacific Insight sells to Portlandbased Daimler Trucks North America LLC and to auto parts suppliers such as Borgwarner Inc. of Michigan and Shanghai-based Yanfeng Automotive Interior Systems Co. Ltd. About 75 per cent of the company's products go to U.S. clients and 15 per cent to customers outside North America, Scott says. From the unlikely location of Nelson, far from the well-established cluster of auto plants and parts makers in southwestern Ontario, Pacific Insight proves that small B.C. businesses can compete globally.
Director and CEO Stuart Ross founded the company in Prince George in 1984 and moved it to Nelson in 1987. Pacific Insight entered the international arena that decade by selling something new—daytime running light control modules—to General Motors' aftermarket division and heavy-truck makers. The company's Nelson facility, a few minutes outside town in a valley near an arm of Kootenay Lake, now employs about 200 people, and another 20 work at a Burnaby corporate office. Pacific Insight also has a factory in Fresnillo, Mexico, and an office in Detroit.
For the 2016 fiscal year, the Toronto Stock Exchange– listed company posted some $127 million in sales and a net profit of $9.8 million. Both were records, and revenue surged 54 per cent year-overyear. But Scott notes that this haul is tiny compared to firms like Grupo AntolinIrausa S.A., a Spanish maker of parts for automotive interiors, which reported sales of €5.2 billion (about $7.5 billion) in fiscal 2016.
A key accomplishment last year for Pacific Insight was the development and prototyping of advanced lighting systems for an important new customer: U.S. electric car maker Tesla Motors Inc. The ability to service conventional and electric vehicles positions the company well for the future, Scott says. Ambient lighting will become even more of a focus with the advent of self-driving cars. Envisioned as an office or entertainment centre on wheels, autonomous vehicles will deliver a personalized experience, with sophisticated lighting as a selling feature.
Pacific Insight's design philosophy sounds like a catchphrase from a Lincoln commercial: evolution rather than revolution. This is how to take on the big players, according to Scott. “Some companies might have billion-dollar research departments that are looking at white space 10 or 15 years out. We tend to come up with innovative ideas that are extensions of our product lines today,” he says, explaining that clients like that approach because they can get the new products into their vehicles within a few years. “We service the heck out of our customer, and we very rarely lose a customer. It's that old adage where you don't have to be way ahead of your competitors, as long as you're constantly ahead of them.”