Napa Auto Parts 2014 Annual Report Download - page 9

Also in 2014, the Company expanded its operations in Mexico to include Autopartes NAPA Mexico
(“NAPA Mexico”), a wholly-owned subsidiary of the Company. NAPA Mexico opened its first automotive parts
distribution center in October 2014 and will serve the automotive aftermarket in Mexico through a combination
of Company owned and independently owned auto parts stores.
Additionally, the GPC Asia Pacific automotive business acquired RDA Brakes and PJL Diesel Electric in
April and September, 2014, respectively. RDA Brakes is a leader in the Australian brake rotor market and PJL
specializes in the distribution of automotive electrical products.
The Company has a 15% interest in Mitchell Repair Information (“MRIC”), a subsidiary of Snap-on
Incorporated. MRIC is a leading automotive diagnostic and repair information company with over 40,000 North
American subscribers linked to its services and information databases. MRIC’s core product, “Mitchell ON-
DEMAND”, is a premier electronic repair information source in the automotive aftermarket.
The Company’s NAPA automotive parts distribution centers distribute replacement parts (other than body
parts) for substantially all motor vehicle makes and models in service in the United States, including imported
vehicles, trucks, SUVs, buses, motorcycles, recreational vehicles and farm vehicles. In addition, the Company
distributes replacement parts for small engines, farm equipment and heavy duty equipment. The Company’s
inventories also include accessory items for such vehicles and equipment, and supply items used by a wide
variety of customers in the automotive aftermarket, such as repair shops, service stations, fleet operators,
automobile and truck dealers, leasing companies, bus and truck lines, mass merchandisers, farms, industrial
concerns and individuals who perform their own maintenance and parts installation. Although the Company’s
domestic automotive operations purchase from approximately 100 different suppliers, approximately 49% of
2014 automotive parts inventories were purchased from 10 major suppliers. Since 1931, the Company has had
return privileges with most of its suppliers, which have protected the Company from inventory obsolescence.
Distribution System. In 2014, the Company operated 60 domestic NAPA automotive parts distribution
centers located in 40 states and approximately 1,100 domestic company-owned NAPA AUTO PARTS stores
located in 45 states. The Company also operated one domestic TW distribution center and 14 Traction Heavy
Duty parts stores located in four states. Traction is a supplier of parts to small and large fleet owners and oper-
ators. At December 31, 2014, the Company owned either a noncontrolling or controlling interest in six corpo-
rations, which operated approximately 114 auto parts stores in nine states.
NAPA Canada/UAP, founded in 1926, is a Canadian leader in the distribution and marketing of replacement
parts and accessories for automobiles and trucks. NAPA Canada/UAP employs approximately 3,900 people and
operates a network of 12 distribution centers supplying approximately 594 NAPA stores and 107 Traction
wholesalers. The NAPA stores and Traction wholesalers are significant suppliers to the mining and forestry
industries. The NAPA stores and Traction wholesalers in Canada include approximately 183 company owned
stores, 12 joint ventures and 25 progressive owners in which NAPA Canada/UAP owns a 50% interest and
approximately 481 independently owned stores. NAPA and Traction operations supply bannered installers and
independent installers in all provinces of Canada, as well as networks of service stations and repair shops operat-
ing under the banners of national accounts. UAP is a licensee of the NAPA®name in Canada.
In Canada, Altrom Canada operates three import automotive parts distribution centers and 10 branches. In
the United States, Altrom America operates two import automotive parts distribution centers.
In Australia and New Zealand, GPC Asia Pacific, originally established in 1922, is a leading distributor of
automotive replacement parts and accessories. GPC Asia Pacific operates eight distribution centers, 405 Repco
stores and 76 branches associated with the Ashdown Ingram, Motospecs, McLeod and RDA Brakes operations.
In Mexico, Auto Todo owns and operates 10 distribution centers, four auto parts stores and four tire centers.
NAPA Mexico owns and operates one distribution center and seven auto parts stores. Auto Todo and NAPA
Mexico are licensees of the NAPA®name in Mexico.
The Company’s domestic distribution centers serve approximately 4,900 independently owned NAPA
AUTO PARTS stores located throughout the United States. NAPA AUTO PARTS stores, in turn, sell to a wide
variety of customers in the automotive aftermarket. Collectively, these independent automotive parts stores
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