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Monro says ATD will provide more frequent deliveries to its stores than the company was able to provide on its own as part of a distribution and ful llment agreement.

Photo: ATD

The details matter in Monro-ATD deal

Some of the industry’s biggest players have made some waves as of late and that includes the new power couple of Monro Inc. and American Tire Distributors Inc. (ATD). Not only has ATD bought Monro’s wholesale operations, but the agreement means Monro will purchase “at least 90%” of its tires from ATD. That means the wholesaler’s customer list grew by 865 tire stores in 32 states. And Monro wants to focus even more of its business on tires. The company’s sales grew by $98 million in its 2022 scal year, which ended in March.

1. Has replacement tire sellout peaked? 2. Podcast: Goodyear-Cooper: One year later 3. Who’s tops in tires, according to J.D. Power’s new aftermarket study? 4. Monro will purchase most tires from ATD 5. Hankook President Brison to leave company on July 1 6. New bill would encourage eets to use retreads 7. Pirelli CEO eyes more growth in high-diameter, EV segments 8. Market forces squeeze truck tire manufacturers 9. Ocean Shipping Reform Act could bring relief 10. Podcast: Why the truck tire market has kicked into overdrive

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Growing with dealers is ‘the only way,’ says Pirelli CEO

ZANARDO ALSO EYES GROWTH IN HIGH-DIAMETER, EV TIRES

Claudio Zanardo has been CEO of Pirelli Tire North America Inc. (PTNA) for only 10 months, but he’s moving the company forward on a number of fronts, while building on its strengths. Zanardo and Ian Coke, chief technical of cer, Pirelli North America, discuss those initiatives in this MTD interview.

MTD: Can you describe PTNA’s performance last year and during the rst six months of 2022? What have the challenges been? What have the bright spots been?

Zanardo: e market has been strange in the last 18 months, because of the pandemic situation and the shortage of raw materials, components — everything. We can say that we are growing. Last year, we were able to go back to numbers and volumes that were more aligned to the pre-pandemic period and this year, we are seeing very strong growth, particularly in the higher (end) of the market — the 18- and 19-inch (segment.) at is where we compete and where we are. North America is a very important market for us. We are growing because we’ve done a lot of investment — and in particular, speci c products for this region.

MTD: You have mentioned that PTNA outpaced the market last year..

Zanardo: We are growing very well thanks to all the investment we have done, particularly in the range that is growing more. The 18-and 19- inch market is very resilient and is growing a lot. Our part of the market is growing. People are recognizing our product and are asking for our product.

MTD: Pirelli is making signi cant investments at its plant in Silao, Mexico, which is intended to be a key driver for the company’s growth in North America.

Can you elaborate? (Editor’s note: Pirelli recently announced that it will invest $15 million in the Silao plant over the next several years. is includes the establishment of a new research and development center at the facility.)

Zanardo: is year, we are celebrating the 150th anniversary of Pirelli. We have two plants in the region — one is the plant in Rome, Ga,, which is celebrating its 20th anniversary, and one in Silao, Mexico, which is celebrating its 10th (anniversary). It’s a never-ending story of investing, growing and putting new resources there. We need to be in the market, near our customers and near where the demand is.

We are investing in two ways. One is capacity. We now have reached, more or less, 7.2 million tires (annual) capacity in Mexico. Most of these tires are dedicated to North America. And on the other side, we are investing in research and development and building a new R&D center in Mexico. We need to have development near the market — not just production.

MTD: Are you running at maximum capacity in Mexico?

Zanardo: Almost. We are really pushing hard because the demand is there.

MTD: What’s the maximum annual capacity at the Rome, Ga., plant?

Zanardo: e Rome plant is around 350,000 to 380,000 tires. It depends on the mix we produce.

Coke: Ninety- ve percent of our production (there) is 20-inch and above, of which 45% is 22-inch and 23-inch. e Rome production is more of the niche tments, which we specialize (in).

Zanardo: Silao is the place where we do big volumes. In Rome, it’s small lots …. mostly dedicated to OE. In Silao, we are working

“We are developing new projects and new programs — things that can put us near the end consumer, together, with dealers,” says Claudio Zanardo, CEO of Pirelli Tire North America Inc. (left), with Ian Coke, chief technical of cer, Pirelli North America. “We want to make things very easy.”

Photo: Pirelli Tire North America Inc.

for OE, as well, but also replacement is a big percentage.

MTD: PTNA continues to land key OE tments. Can you discuss your OE strategy? Is it the same as it has been? For example, are you looking to expand your tments

in the light truck category?

Zanardo: We are. We’re investing a lot. We work together with almost all the carmakers. It’s an important investment for us because we develop technologies together. We are investing a lot in new homologations. And as of today, we are working a lot with all the electric (vehicle) players — not just (new ones), but the traditional ones who are jumping into the electric world.

MTD: Electric vehicles (EVs) are still a small part of the overall car population in North America. What opportunities do you see for PTNA to be a signi cant player in the EV tire market?

Zanardo: e EV market is still small, but is growing a lot. Now we are seeing the rst signals of that in the replacement channel. We have around 250 homologations already on EVs at the worldwide level. And we are

working with the U.S. players who are active in electric cars — fully dedicated electric (manufacturers) like Tesla and Rivian, but also traditional carmakers.

MTD: Do you see the EV market growing quickly?

Zanardo: Yes. The interest in the end consumer is there. And the investment in OE is there.

Coke: ese OE projects start two to three years before. Some of them are a little bit shorter, especially with the startups, which have a di erent rhythm of tire development. But you need to have the technology. So it’s an opportunity for a tier-one… that has a strategy to attack this market.

We’ve seen a lot of people fail. We’ve seen a lot of people have success. You never know who’s going to come through it. But the volume is coming. SUVs and trucks are now electri ed. All the major guys are bringing out models. Rivian has a truck out, as well. So I think when you see that, there’s going to be a very rapid acceleration in the electri cation of the market — as long as the infrastructure keeps up.

MTD: How many U.S.- based OE tments do you have now?

Zanardo: When we look to the U.S. market, almost 80% of (our) new homologations are on eclectic vehicles.We continue to invest in traditional tires, but the electric part is something that is growing. We need to be ready with OE, as well as replacement. at pull-through is very important on

Pirelli continues to make substantial investments in racing, which serves as “a test lab” for the company, says Coke. Participation in motorsports provides “very valuable data” that “pushes” Pirelli’s consumer tire technology forward, he adds.

Photo: MTD electric cars, in particular. If you don’t put the right tire on your car, it’s not the same. is is where we need dealers. ey need to explain to the consumer the di erences in the products.

MTD: What sort of educational support and materials are you providing to your dealers so they can effectively talk to customers about Pielli’s EV tires?

Zanardo: We are developing new training systems to be launched in the next month for dealers. It’s important to know and understand which cars (where) we are present.

MTD: How would you describe PTNA’s presence among tire dealers? Are you still actively growing your dealer network or are you at the point where you have enough dealers who are strategically placed?

Zanardo: We are not covering (enough of the) market. We want to grow. We are developing new programs in order to involve more and more dealers. e easier you can speak with dealers and end consumers, the easier you can put your product into the market.

Dealers are fundamental. I come from this experience in Europe and in the U.S., as well, dealers are at the center of our experience and our presence in the market. We want to present our product to the end user and we cannot do that alone.

MTD: ere have been some changes at PTNA over the last couple of years. Marco Crola was in your shoes from 2018 to 2020 and then Pietro Berardi for slightly less than two years. You were appointed CEO this past November. Some dealers have told us, too, that programs have changed during those years. What are you planning to do in order to stabilize things and then take it to the next level?

Zanardo: At the end, we have a strong team, so it’s not just me. It’s the entire company that’s behind our product. We are developing new projects and new programs — things that can put us near the end consumer, together, with dealers. We want to make things very easy because this is the key, in my opinion.

macroeconomic factors beyond our control, like shipping. What’s the biggest challenge facing PTNA at the moment?

Zanardo: It’s a combination of all di erent factors. What you have to do to be successful in this environment is to be able to adapt to the situation. We have incredible algorithms to help us understand what demand will be for the next year and years. We know the cars that OEMs are producing and the tments that are there. e biggest challenge at the moment is the supply chain. Raw material prices (also) are going up. Energy prices are going up. e combination of those factors is creating sort of a perfect storm in the market and you have to adapt.

MTD: Like other manufacturers, Pirelli has had to raise tire prices. (Editor’s note: PTNA increased consumer tire prices three times during the rst half of 2022 — most recently a hike of up to 10% that went into e ect on June 15.) How are your dealers reacting as their costs continue to go up?

Zanardo: It’s not easy because we are coming from years and years where we were not seeing an in ation rate like now. e cost of everything is (increasing) — raw material costs, energy costs and transportation costs. e price increase is really mandatory to (maintain) quality levels. We don’t want to have any compromise. It’s a big challenge for dealers … being able to put this increase into the market, as well.

MTD: Do you think demand for tires is going to continue throughout the rest of the year and into 2023?

Zanardo: I think personally, we will keep seeing a market that will grow. In particular, I’m referring to the segment where we play — the 18- and 19-inch market. Double-digit growth will continue this year and next year, as well.

MTD: What can tire dealers expect to see from PTNA during the rest of the year?

Zanardo: ere are two things we are working on. One is programs to support dealers and the other is training. We are developing these things. Everything will be easy to use and understand. We want to grow and we want our partners to grow. We need to grow together. It’s the only way.

Bites

Bridgestone opens plant

Bridgestone Americas Inc. will make race tires at its new production facility in Akron, Ohio. The Advanced Tire Production Center will produce all 25,000 Firestone Firehawk race tires for the NTT IndyCar Series, plus small batches of prototypes for testing and development in racing and on-road applications.

Toyo raises prices

Toyo Tire U.S.A. Corp. raised prices on select passenger, light truck and commercial truck tires by up to 5% on Aug. 1.

Bandag’s prices climb

Bridgestone Americas Inc. hiked prices on all Bandag tread rubber up to 15% in the United States and Canada, effective Aug. 1. Prices on cushion and some ancillary items increased, as well.

Monro to source from ATD

Monro Inc. will buy “at least 90%” of its tires from American Tire Distributors Inc. (ATD), a deal that gives the wholesaler 865 new tire stores to serve in 32 states. The two companies signed a distribution and ful llment agreement after Monro sold its wholesale operations to ATD.

Mountain View name lives

Since buying Mountain View Tire & Service Inc. in the spring of 2021, Monro Inc. has decided to keep and expand the brand, extending it to at least two other acquisitions in California. The original 30 Mountain View stores continue to use the name and three additionally purchased stores will use it, too.

Big O gets new leader

Brian Maciak was promoted to president and chief operating of cer of Big O Tires LLC, which is owned by TBC Corp. He replaced Jim Bull, who retired on July 1. Maciak previously served as Big O Tires’ executive vice president, general counsel and chief compliance of cer.

TIA starts electric council

The Tire Industry Association has created an Electric Vehicle Advisory Council, which will focus on training “tire and auto dealers on the proper service techniques and procedures of EVs,” according to association of cials. Other functions will include establishing “potential safety protocols” for EV service and best service and maintenance practices.

ATD sells Canadian business to Groupe Touchette

Groupe Touchette Inc. is acquiring American Tire Distributors Inc.’s (ATD) Canadian subsidiary, National Tire Distributors (NTD). e deal includes 26 distribution centers and about 600 employees. It is expected to close during the fourth quarter of 2022.

As part of the agreement, ATD will supply Groupe Touchette and NTD with its Hercules and Ironman brands and will “make its advanced analytics so ware and productivity-enhancing tools available to Groupe Touchette’s network.”

“ e acquisition of NTD will signi cantly contribute to Groupe Touchette’s ability to serve its customers and business partners, bringing enhanced service, increased o ering capacity and more choice to Canadian consumers,” the companies said in a press release. “With NTD, Groupe Touchette’s growth will also create new job opportunities across Canada.”

“On behalf of the entire Groupe Touchette team, we are absolutely thrilled to welcome NTD into our growing family,” say Nicolas Touchette and Frédéric Bouthillier, co-owners at Groupe Touchette.

“Groupe Touchette’s plan is to o er powerful solutions that drive e ciencies and streamline the supply chain for the bene t of customers, consumers and manufacturers. NTD’s addition will help us reach our goal to best serve Canadians.” e divestment “is another important step forward for NTD, ATD and our industry as a whole,” says Stuart Schuette, president and CEO of ATD. “We are very proud of the Canadian business we have built in NTD and are pleased to have reached an agreement with Groupe Touchette that secures a tremendous future for it and the incredible associates, customers and partners who support it.” e combined Groupe Touchette/NTD business will be headquartered in Montreal, Quebec, with a main support center in Burlington, Ontario, plus regional o ces throughout Canada.

Brison moves from Hankook to TireHub

Curtis Brison, who served the rst half of 2022 as president of Hankook Tire North America, has joined TireHub LLC as vice president of sales, marketing and strategic growth.

“Adding Curtis to our executive team is a win for TireHub and for our customers,” says TireHub CEO Ted Becker. “He is a proven leader and accomplished industry executive. He knows the industry, knows our customers and knows Curtis Brison is TireHub LLC’s what it takes to be successful. Curtis is the right new vice president of sales, following a stint as president of person to lead this next stage of dynamic growth.” Hankook Tire North America.

TireHub says Brison will play “a critical, Photo: Hankook Tire North America strategic role” growing TireHub’s business to enable future growth and expansion plans. He also will be responsible for TireHub’s go-to-market strategy.

Brison comes to TireHub with more than 16 years of leadership experience in the tire and automotive industry. In addition to his time at Hankook, he previously led the sales and marketing divisions of Exide Technologies and Michelin.

“I am passionate about this industry, about customers and about providing winning experiences that create pro table growth,” says Brison, who adds that he has watched TireHub’s “energy and excitement spread across the tire industry.”

Bites

New Toyo plant opens

A new Toyo Tire Corp. consumer tire manufacturing plant in Europe that will help boost the company’s U.S. supply opened in July. The Serbian facility will make passenger and light truck tires and will have a capacity of 2.5 million units annually.

LWG grows in Oklahoma

Leeds West Groups (LWG) has purchased real estate in the Tulsa, Okla., area with plans to rebrand it as a Midas location later this year. The company owns and operates 10 Midas and Big O Tires franchise locations across the state.

Michelin tests on electric rig

Michelin North America Inc. is testing commercial truck tires on an all-electric Class 8 delivery truck provided by Benore Logistics Systems. The month-long test is taking place at Michelin’s plant in Sandy Springs, S.C.

RNR gifts Jeep

RNR Tire Express gave a restored 1995 Jeep Wrangler YJ Sahara, customized with Jurassic Park graphics, to Chris Festo of Archer, Fla., as part of its Father’s Day promotion.

Groups host owners

Auto Value and Bumper to Bumper hosted a promotional trip for shop owners and their families in Orlando, Fla. The trip was part of a fall promotion and was tied to purchases throughout the Auto Value and Bumper to Bumper network.

Pirelli extends EV line

Pirelli & Cie SpA says its Pirelli Elect electric vehicle (EV) tire is widely available for aftermarket and winter applications. Pirelli calls winter tires for EVs “a relatively new, but rapidly growing sector.”

TIA names secretary

Bridgestone Americas Inc.’s Debra Hamlin has been elected secretary of the Tire Industry Association (TIA). She will start her term in November. She is Bridgestone’s director of environment, health, safety and sustainability in the commercial tire division and will be in line to serve eventually as TIA president.

Dave Marks to retire from ITDG

Dave Marks, president and CEO of the Independent Tire Dealers Group LLC (ITDG) since August 2017, will retire in 2023 upon the selection of — and successful transition to — his successor.

Under his leadership, ITDG boosted its number of member locations by more than 50% to 1,000 and grew its sales to nearly $350 million annually.

“His outstanding sales leadership and team building — combined with his passion for excellence and getting exceptional results — has led to the group’s tremendous success,” say members of ITDG’s board.

Prior to his present role at ITDG, Marks held management, sales leadership and operational/ Dave Marks will retire as the leader of ITDG after a 40-plus year career in the tire industry. distribution positions at Tireco/Tire Photo: ITDG Distributor Experts and American Tire Distributors Inc. He also spent 15 years at Tire Dealers Warehouse.

Marks’ tire industry career began in 1978.

Commenting on his upcoming retirement and departure from ITDG, Marks says, “I am extremely grateful to the (group’s) shareholders and the board of ITDG for allowing me the opportunity to help guide this group over the last ve years.

“What a terri c end to a very rewarding career, where I’ve been able to develop everlasting friendships, as well as provide for my family over the last 40 years.”

“I am very thankful to the many friends and mentors who have helped guide and support me over the years and I am also honored to be able to head into retirement on a timetable that I have chosen. I will work closely with the board to nd a successor and to set him or her up for a positive transition. Whoever that is will inherit an elite team, excellent programs, a great new ITDG private brand and a successful business model.”

A new search sub-committee of the ITDG board of directors will identify and present candidates for review.

“Our goal is to ensure that Dave’s replacement is the best t to lead us into the future” says Rob Slagle, chairman of the ITDG board. “ e timeline for Marks’ departure in 2023 will be determined once a successor has accepted the position.”

Sailun will open U.S. tech center

The Sailun Group will open the Sailun Tire Americas Technical Center in Chattanooga, Tenn., which will design passenger, light truck, SUV, CUV and medium truck tires, plus tires engineered for electric vehicles. Tires will be designed for both the original equipment and replacement channels. e decision to invest in the center “marks a signi cant step in the growth of R&D and the technical capabilities for the company in North America,” say Sailun o cials.

Terry Edwards will serve as the facility’s chief technical o cer and will lead all activities there. Edwards “brings over four decades of expertise in the areas of OE and replacement tire R&D, quality and manufacturing” to the role.