Company Background and Organization

9 Months Ended

Dec. 31, 2019

Company Background and Organization [Abstract]

Company Background and Organization

1. Company Background and Organization

Motorcar Parts of America, Inc. and its subsidiaries (the “Company”, or “MPA”) is a leading supplier of automotive aftermarket non-discretionary replacement parts and diagnostic equipment. These replacement parts are primarily sold to automotive retail chain stores and warehouse distributors throughout North America and to major automobile manufacturers for both their aftermarket programs and warranty replacement programs (“OES”). The Company’s diagnostic equipment primarily serves the global automotive component and powertrain testing market. The Company’s products include (i) rotating electrical products such as alternators and starters, (ii) wheel hub assemblies and bearings, (iii) brake master cylinders, (iv) brake calipers (introduced in August 2019), and (v) other products. Other products include: (i) brake power boosters, (ii) turbochargers, (iii) diagnostics systems, (iv)advanced power emulators, and (v) custom power electronic products.

The Company primarily ships its products from its facilities and various third party warehouse distribution centers in North America.

Pursuant to the guidance provided under the Financial Accounting Statement Board (“FASB”) Accounting Standards Codification (“ASC”) for segment reporting, the Company has identified its chief operating decision maker (“CODM”), reviewed the documents used by the CODM, and understands how such documents are used by the CODM to make financial and operating decisions. The Company has determined through this review process that its business comprises three separate operating segments.  Two of the operating segments meet all of the aggregation criteria, and are aggregated. The remaining operating segment does not meet the quantitative thresholds for individual disclosure. Since this immaterial operating segment meets the aggregation criteria of ASC 280, the Company has combined its operating segments into one reportable segment.

In January 2019, the Company completed the acquisition of Dixie Electric, Ltd (“Dixie”). During the nine months ended December 31, 2019, the Company finalized the purchase price allocation of Dixie with no material adjustments.