Modern Tire Dealer - March 2019 by EndeavorBusinessMedia-VehicleRepairGroup

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The Industry’s Leading Publication March 2019, Volume 100, Number 3

F E AT U R E S evolution of winter tires 20 The Even the 3-Peak Mountain Snowflake 20

DEPARTMENTS 4 Editorial ‘I’ is for Independent: Our industry loses 3 outspoken and family-oriented tire dealers

6 moderntiredealer.com

isn’t enough anymore

new Blizzak 24 Bridgestone’s The WS90 will deliver ‘an extra season of winter use’ braking news 26 Ice Continental trades 2 winter tires for the VikingContact 7

27 ‘Stainless steel is a brilliant idea’

News and navigation tools for MTD’s website

Nokian’s latest LT winter tire features new stud technology

8 News/Views Toyo and Les Schwab are no longer exclusive

16 Your Marketplace Recent economic risk factors have been resolved with minimal negative impact on dealers

28 A review of no-credit-

needed payment programs Alternatives to traditional financing can help dealers capture more sales

18 Numbers that Count Relevant statistics from an industry in constant motion

50 Business Insight 10% net profit: Get your fair share for the products and service you provide

52 European Notebook A positive year behind them and more to come from Falken Europe

answer this question: 42 Experts When should a vehicle’s suspension parts be replaced? Present, Future 44 Past, Female tire dealers: ‘For the best in tires, see Chanice Kobolowski’

Focus on industry 54 Point S dealers invest in digital tools: Adding Toyo is ‘an opportunity for growth’ 56 Federal releases a new kind of M/T tire: Xplora MTS is one of four new products for 2019

58 Goodyear introduces new tires, new sizes and more e-commerce TPMS 60 Toyota Sienna 2007-18

70 Products 72 Ad index 73 Classified ON THE COVER: ©GETTYIMAGES.COM/MARCHELLO74

Modern Tire Dealer is a proud member of:

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44 3

Editorial

‘I’ is for Independent OUR INDUSTRY LOSES 3 OUTSPOKEN AND FAMILY-ORIENTED TIRE DEALERS By

Bob Ulrich

here’s no “I” in “team” or “teamwork.” There is, however, an I in “independent.” And that still means a great deal in the tire industry. We lost three truly independent tire dealers within a three-week period earlier this year. Charley Gowland, co-founder of Chabill’s Tire and Auto Service LLC in Morgan City, La., died on Jan. 24. Mike Gatto, who started Gatto’s Tires and Auto Service in Melbourne, Fla., died on Feb. 11. Only two days later on Feb. 13, Roland Lesieur, co-owner of Maynard & Lesieur Inc. in Nashua, N.H., passed away. Independents are the bedrock of the tire industry. That foundation is very hard to crack, even when we lose luminaries such as these three gentlemen. Why? Perhaps because they leave behind both the basics and secrets of running a tire store to the next generation whenever possible. These dealers were extraordinarily independent. They were successful. They gave back to the industry and the communities they loved. They spoke their minds. Lesieur, 89, was a supporter of the New England Tire and Service Association. He not only served as president, but also wrote a column in the association’s newsletter, The Road Runner, for many years. He wrote from the heart, and rarely, if ever, held his tongue. Here are some of his insightful musings.

“Everything I know about business and life I learned from my dad,” she says. “He was the best sales and marketing guy in the business, and I was in accounting. So we were a good combination.” I asked her if she could think of any business rules in particular he had taught her. Two quickly came to mind. “He always said to hire slow and fire fast. And sometimes you have to fire a customer. I remember years ago we were both at the counter at the Melbourne store, and we couldn’t please one of our customers.” Here’s how she described the conversation between her dad and the customer, Mr. Jones.

‘HE ALWAYS SAID TO HIRE SLOW AND FIRE FAST,’ SAID GALLO.

“The question of tire aging continues to come up. The tire companies… will have to address the issue at some point before the legislatures do it for us. My personal opinion is that there are a lot of politicians looking for some free publicity on this issue.” Summer 2009

“Sears is closing 120 stores around the country. I remember when they downgraded business in downtown Nashua many years ago. In this day and age, it is impossible to stay on top forever.” Spring 2012

“I hear college graduates won’t accept jobs (where) they cannot call out or take personal calls. This is going to grow into a huge problem.” Summer 2012

It looks like the retail and wholesale business started by Roland’s father, Leo, and his grandfather Emile “Pop” Maynard in 1928 will stay in the family for many years to come. In addition to his sons Steve, Mark and Larry, and his daughter, Cheryl Lesieur Appelstein, three of his grandchildren also are working at Maynard & Lesieur. Gatto, 93, spent 22 years working at Goodyear Tire & Rubber Co. before he opened up his own tire dealership in 1971. There are now six stores in Brevard County, Fla., under the direction of his daughter Pam Gallo.

“We don’t seem to be able to satisfy you, Mr. Jones. I suggest you go to the Firestone store across the street.” “I’ve already been there.” “Well then, I suggest you go Sears.” “I’ve already been there, too.” “Then I suggest the problem may be you and not us!” Now it’s Gallo’s turn to teach the third generation, including her sons Mike and Scott, how to run the business. Then there’s Gowland, 76, who with his business partner, Billy Parker, formed Chabill’s — an acronym of their first names — in 1968. In addition to helping build a 17-store chain in Louisiana, he served the Louisiana Independent Tire Dealers Association for several years in a number of capacities, including president. He was an outspoken member of Modern Tire Dealer’s National Advisory Council. If the name sounds familiar, he was the first dealer to publicly criticize Goodyear for selling tires online. “Goodyear selling tires directly to consumers is a real problem for me,” he wrote in a letter to our magazine shortly after the news broke in 2015. “You, the dealer, have a much better chance at establishing a relationship with a new customer if you are the one who sold the tires.” Two years later, his viewpoint had softened. “Fifteen percent of tire transactions are going to happen online,” he told me. “You certainly want to be a part of it, but you don’t want to be a part of that and lose money.” He died less than two months after naming another industry veteran, his daughter Beth Barron, CEO of the company. All three of the deceased left their family businesses in good shape, with family ownership intact. Call it the business world’s answer to the circle of life. ■ If you have any questions or comments, please email me at bob.ulrich@bobit.com.

MTD March 2019

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The United Steelworkers union (USW) filed a formal complaint in 2016 saying imports were harming the U.S. truck tire market. Initially, the ITC voted not to impose tariffs.

Reversal of fortunes It’s pretty rare for one of the news items on our website, www.moderntiredealer.com, to hold onto a top news spot for multiple weeks. But that’s exactly what our No. 1 news item did. Web readers were keenly interested in how the International Trade Commission (ITC) reversed its earlier decision and ruled the U.S. tire market is indeed being harmed by the import of truck and bus tires from China. The ITC took no time in implementing new countervailing and antidumping duties ranging from 9% to 63.34%. Other top items again focused on the big names in the industry. Here are our top 10 news items for the past month. 1. ITC reverses course and says Chinese truck tires hurt U.S. industry 2. Les Schwab no longer holds exclusive rights to Toyo in northwest U.S. 3. K&M Tire thrives in a year of disruption for tire distribution 4. Goodyear will sell commercial tires online in 3Q 5. 2018 was another big year for Chinese truck tires in the U.S. 6. Bridgestone’s new Akron plant will produce 30,000 Firehawk tires a year 7. Acquisitions had a big effect on Michelin in 2018 8. Monro acquired 52 stores in 10 months 9. Goodyear’s earnings double in 2018 10. Cooper’s net income and sales are down year-over-year

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MTD March 2019

News/Views

Toyo and Les Schwab are no longer exclusive TIRE DEALER LOOKS TO NEW TIRES AND NEW MARKETS

or 52 years Les Schwab “Shifts in the distribution Tire Centers Inc. had market, and Les Schwab’s growan exclusive, multiing regional footprint, made our state territory with Toyo limited exclusivity with Toyo Tire USA Corp. That deal, challenging in new markets. which effectively locked out As a result, we’ve shifted our other tire dealers, including product strategy, and diversified online retailers, from selling our selection. Toyo-branded products in the “With our focus on continnorthwest corner of the U.S., ued growth outside the Pacific has come to an end. Northwest, we will remain As of Jan. 1, 2019, Toyo is nimble with a product screen open to doing passenger and focused on the customers’ needs light truck tire business with in each market.” other tire dealers in Oregon Les Schwab the dealership and Washington, plus the porfollows the principles of its tions of Idaho, Northern Cali- The Toyo team was drumming up new business with Point S tire founder and namesake, who fornia, Montana and Nevada dealers at its annual dealer meeting in February. From left, Sam died in 2007. He believed in Felberbaum, director of sales, Randy Gaetz, senior vice president which previously were locked of sales, and Sonny McDonald, national training manager. promoting one name as the up in the Les Schwab territory. provider of tires for consumers: Randy Gaetz, senior vice president of in the U.S. Toyo has joined the ranks as Les Schwab. That branding continues in sales for Toyo, said that doesn’t mean the one of five preferred partner vendors store, and online, where there’s no mention tire manufacturer has parted ways with with Point S, and Toyo tires arrived in of major brand names. Les Schwab. It simply means the Oregonthe Point S warehouses a week before Thompson said, “Manufacturer brand grown dealer, the fifth-largest independent the meeting. Even though the Point S tires will remain an important part of tire dealer in the U.S. with more than 420 network is growing eastward, it remains our product mix.” But the company will company-owned stores, no longer has the heavily concentrated in the northwest continue to leverage its private brands. exclusive rights to sell Toyo passenger and corner of the U.S., which Les Schwab “Over more than 65 years we’ve grown to light truck tires in those states. also calls home. be one of the largest tire retailers in the “We will continue to sell tires to Les Gaetz does expect the changes with Les country, and in many cases we are able Schwab,” Gaetz said in an interview with Schwab to ding the company’s sales in the to leverage our sales volume with tire Modern Tire Dealer. “Les Schwab was our region, yet, he sees potential. “It’s going to manufacturers to develop brands and biggest customer.” take time to build it back.” products with performance attributes Gaetz said Les Schwab will remain one How long? “Two to three years.” that specifically meet our customers’ of Toyo’s top 10 customers. As for Les Schwab, Chief Marketing requirements. Les Schwab does maintain an exclusive Officer Dale Thompson said the tire dealer “About five years ago Les Schwab looked territory for Toyo-brand commercial truck remains committed “to providing the best at ways to improve our product offerings tires in Oregon and Washington through performing products to our customers no to our customers while ensuring all of our the end of 2019. That truck tire agreement matter what price point or segment they current and future stores can focus on continues on a year-to-year basis, and Gaetz are in. Toyo tires have been a significant product performance for our customers, said Toyo and Les Schwab will sit down product offering for many years and we instead of nationally known brand placeto talk about renewing that commercial will continue to sell them in the segments ment and reputations. It has always been territory agreement in the fall. when there is a benefit to our customour focus to provide the best service and The change means Toyo is working ers. We look forward to keeping a strong tire performance regardless of national to reach into every viable market in the relationship with Toyo.” brand recognition. By designing our tires former Les Schwab PLT territory, and Thompson called Toyo “a valued busiin cooperation with key manufacturing in mid-February that took Gaetz and ness partner for more than 50 years,” but partners we continue to be able to give a team of Toyo representatives to the said over time “the industry has changed our customers excellent products, at fair annual meeting of Point S tire dealers and Les Schwab’s needs have changed. prices.” — Joy Kopcha and Ann Neal

MTD March 2019

News/Views

Tire Kingdom unveils its ‘shop of the future’

Bites Kumho has new CEO Kumho Tire Co. Inc. has promoted Jeon Dae-jin to CEO. The 35-year Kumho veteran has most recently served as senior executive vice president, as well as acting CEO.

Sullivan and Cora team up Sullivan Tire Co Inc. is continuing its connection to the Boston Red Sox, this time with a partnership with manager Alex Cora. The two-year agreement includes television commercials and personal appearances.

TIA offers OTR tire guide The Tire Industry Association (TIA) has compiled the average and maximum weights of more than 500 off-the-road tires, as well as more than 100 wheels. The information is available in a free download.

Hunter adds ADAS data Hunter Engineering Co. has added information required for resetting advanced driver assistance systems (ADAS) to its HunterNet smart technology platform.

BC Corp.’s Tire Kingdom Service Centers is rolling out a “shop of the future” concept, and the first store featuring the new look is open in West Palm Beach, Fla. “Our shop of the future concept was designed with our customers in mind,” says TBC CEO and President Erik Olsen. “Focus groups, customer surveys and feedback helped us to design a space that was comfortable for customers, ideal for associates and now affords us the opportunity to exceed customer expectations at a beautiful location that is state-of-the-art and conveniently located on Northlake Boulevard.” The new Tire Kingdom store features eight service bays, as well as a state-ofthe-art business area, digital TBC says the waiting area of Tire Kingdom Service feature wall, enhanced conces- Centers’ new store format features a modern, comfortable look and focuses on the customer. sion area, large open view to the back shop, upgraded broadband connectivity and digital inspection equipment. There are nearly 190 Tire Kingdom locations throughout Florida.

Free job search board serves entire tire industry

Discount Tire and AAA partner Discount Tire is partnering with the Southern California affiliate of the American Automobile Association (AAA) to provide flat repairs and tire replacements to AAA members. The pilot program with the Automobile Club of Southern California will deploy at Discount Tire/America’s Tire retail stores in San Diego and Los Angeles.

Cardone will reward techs Cardone Industries Inc. is challenging auto technicians to share installation videos for a chance to win $5,000. Videos must be submitted between March 1 and July 17, 2019.

Take 5 Oil Change expands Driven Brands Inc. continues to expand its automotive service network with the acquisition of 48 Super-Lube locations in Florida, Wisconsin, Indiana, Illinois and Alabama. The stores will be added to Driven Brands’ Take 5 Oil Change quick lube network.

Giti has Passat fitment Giti Tire (USA) Ltd. will supply Comfort A1 all-season tires in two sizes from its Chester County, S.C., plant for the 2019 Volkswagen Passat.

ooking for a go-to source for any career or talent search in the tire industry? Tire Talent Founder Mike Cioffi has created it. The answer: www.TireCareers.com. It’s a free job board that both manufacturers and tire dealers can use to post jobs, and anyone searching for work can use to find a job. Cioffi operates Tire Talent, a search firm that’s focused on matching employees with employers in the tire and automotive industry. He says he’s learned there’s a

need for one spot to serve as a hub for all job-related searches and openings. He receives weekly inquiries for technicians, counter sales professionals and other positions that fall outside the primary scope of his search firm’s business. Cioffi’s firm typically focuses on matching jobs with employees for exempt-level positions, but he sees TireCareers.com as a springboard to serving the entire industry, particularly in tire dealerships and automotive shops where much of the demand is tech-related.

Rice Tire buys Central Tire The Donald B. Rice Tire Co. Inc., which does business as Rice Tire., has acquired Central Tire Co. of Verona, Va. Central Tire was founded by Guy Westhafer in 1945. The company has been run by his sons, Terry and Tommy, for the last

four decades. Central Tire served customers in Virginia and parts of Pennsylvania, North Carolina, Washington, D.C., and West Virginia through a retail store, commercial store and retread plant. The purchase gives Rice Tire 11 locations and its

second retread plant. Rice Tire was founded by Donald B. Rice in Frederick, Md., in 1956. Now into its fourth generation of leadership, the company serves commercial and retail customers in Maryland, Virginia, Pennsylvania and Washington, D.C. MTD March 2019

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News/Views

LT275/65R18 cracks the top 10 replacement sizes list

Bites Tenneco names spin-off DRiV Inc. is the name of the future publicly traded aftermarket and ride performance company that will launch in the second half of this year, following Tenneco Inc.’s separation into two independent companies.

Nokian is honored Nokian Tyres plc earned the Silver Class distinction in the RobecoSam Sustainability Yearbook 2019, a report of how sustainability is implemented in companies around the world. More than 2,600 publicly traded companies were evaluated in this year’s assessment.

TBC Brands adds website TBC Brands LLC has combined its Power King and Harvest King commercial tire brands into a new website.

Bridgestone will build plant Bridgestone Americas Inc. will begin building a race tire manufacturing plant in Akron, Ohio, in the summer of 2019. Production is set to begin in 2020 and production will reach about 30,000 Firehawk tires every year.

ize LT275/65R18 finally made it into the Top 10 list of most popular replacement light truck tire sizes. It replaced LT285/75R16 as the 10th most popular replacement LT size. That is not surprising, given that Top 6 OE LT tire sizes LT275/65R18 has been one of the Top in the U.S. in 2018 10 original equipment light truck tire sizes for more than 10 years. The only question 1. LT245/75R17 13.1% is, why did it take so long to crack the Top 2. 235/65R16C 11.8% 10 replacement sizes? According to the preliminary edition of 3. LT275/70R18 10.3% the latest U.S. Tire Manufacturers Associa4. LT275/65R18 8.6% tion (USTMA) Factbook, size LT245/75R17 5. LT225/75R16 8.3% remains the most popular OE size — it has 6. LT265/70R18 7.2% been No. 1 for the last eight years The top six OE sizes represented 59.3% of the total OE LT tires shipped by USTMA Top 6 replacement LT tire members in 2018. sizes in the U.S. in 2018 On the replacement side, LT265/70R17 replaced LT245/75R16 at the No. 1 spot 1. LT265/70R17 10.1% by one-hundredth of a percentage point. 2. LT245/75R16 10.0% LT245/75R16 had been the most popular 3. LT225/75R16 7.1% replacement LT size since 2008. The top six replacement sizes represented 4. LT265/75R16 6.4% 45.2% of the total replacement light truck 5. LT275/70R18 5.8% tires shipped by USTMA members in 2018. 6. LT245/75R17 5.8% — Bob Ulrich

Icahn Automotive addresses technician shortage

GRI reaches milestone Global Rubber Industries Pvt. Ltd. (GRI) has released more than 100 unique tire sizes since opening its specialty tire plant in Sri Lanka in January 2018. Agriculture tires are about 70% of the factory’s production; the remaining output is pneumatic construction tires and forklift tires.

Zafco has new VP John Thomas, who has more than 35 years of experience in the tire industry, has joined Zafco International as west zone vice president of sales. Thomas has previously worked for YC Rubber Co. (North America) LLC, Nexen Tire America Corp. and Sentury Tire USA Inc.

Michelin markets to associations Michelin North America Inc. is partnering with seven trade associations as part of its BFGoodrich Tires Tradesmen Support Program to raise awareness of its BFGoodrich brand. The associations represent 1 million tradesmen and women.

cahn Automotive Group LLC and its more than 2,000 company-owned and franchise locations are preparing for increased demand for automotive service technicians. Through a new program, “Race to 2026,” Icahn Automotive is encouraging more men

and women to pursue viable careers in the skilled trades by rolling out partnerships with technical training schools; offering scholarships, tuition reimbursement and apprentice programs; and creating internship programs, job placement and continuing education opportunities.

2 manufacturers raise commercial tire prices

ridgestone Americas Tire Operations LLC is imposing a double-digit increase on all Dayton-brand truck and bus tires sold in the U.S. The company says as of March 5, 2019, Dayton truck and bus tire prices will go up 20% due to “increased business costs and other market dynamics.” The 20% hike follows a 10% increase in September 2018. Toyo Tire U.S.A. Corp. will increase the price of almost all of its commercial tires on May 1. The company says the base price for dealers to purchase Toyo commercial tires will go up by an average of 5% on May 1, 2019. However, the price of the Toyo M320 will remain the same. MTD March 2019

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News/Views Norm Affleck, a founding member of Big O Tires, has died

Dates April 4-7 Automechanika Istanbul, Tuyap Fair, Convention and Congress Center, Istanbul, Turkey +90 216 384 50 50 www.automechanika-istanbul.tr

April 10-12 Clemson University Global Tire Industry Conference, Sonesta Resort, Hilton Head Island, S.C. (864) 656-2200 www.clemsontireconference.com

April 12-13 Texas Tire and Automotive Association Convention, Menger Hotel, San Antonio (800) 844-8748 www.texastiredealers.org

April 12-14 Virginia Automotive Association Convention, Hilton Norfolk The Main, Norfolk, Va. (804) 739-1400 www.vaauto.org

May 8-10 Heavy Duty Trucking Exchange, The Scottsdale Resort at McCormick Ranch, Scottsdale, Ariz. (800) 576-8788 www.heavydutytruckingexchange.com

May 22-26 Autopromotec, Bologna Exhibition Centre, Bologna, Italy +39 051 6424024 www.autopromotec.com

June 4-6 Automechanika Birmingham, National Exhibition Center (NEC), Birmingham, England +44 (0) 1483 483984 www.automechanika-birmingham.com

June 10-12 Automechanika Dubai, Dubai World Trade Centre, Dubai, United Arab Emirates +971 4 389 45 00 www.automechanikadubai.com

June 13-14 Asian Tyre and Rubber Conference, Chennai, India +91 9833 901 586 www.atrc.in

orm Affleck, retired CEO and president of Big O Tires Inc., died on Feb. 8, 2019. He was 95. Affleck was a founding dealer member of Big O Tires and instrumental in the introduction of the Big O brand 33 years ago. He flew B29s in the Air Force during World War II, and he completed 32 missions. In 1945, Affleck started in the tire business as an O.K. Rubber Welder store owner. By 1960 he had six stores in southern Colorado and New Mexico. In 1962, he and a group of other O.K. Rubber Welder franchisees formed Big O Tire Dealers Inc. From 1962 to 1984 he served Norm Affleck was as president. For three years he flew his own plane around the the first president of Big O Tires, a country, at his expense, meeting with independent dealers and position he held selling the Big O concept. for 25 years. “In 1965, Affleck developed and implemented the first speed lane in the tire industry,” says John Kairys, Big O’s vice president and general manager. “He created a drive-through bay in his Denver store. The result was an immediate improvement in customer satisfaction, and increased productivity and store profitability.” Affleck retired in 1984, but he continued to contribute to the industry through his retreading and recycling efforts. He also worked as a consultant. He was inducted into the Tire Industry Hall of Fame in 2007.

Tire industry icon Roland Lesieur dies

oland Lesieur, co-owner of Maynard & Lesieur Inc., and former president of the New England Tire and Service Association, died on Feb. 13, 2019. He was 89 years old. After serving as a second lieutenant in the U.S. Army, Lesieur joined Maynard and Lesieur Inc., a family tire business founded in 1928 by his father, Leo, and his grandfather, Emile “Pop” Maynard. Lesieur was a board member for companies and associations, including the former National Tire Dealers & Retreaders Association (NTDRA). “Roland was a giant in the industry,” said Roy Littlefield, CEO of the Tire Industry Association. “He was a driving force in NTDRA’s early legislative efforts, and spent more time than any other tire dealer on Capitol Hill for the successful passage of voluntary tire registration.”

Gatto’s Tires founder Mike Gatto dies at 93

ichael Gatto, who started Gatto’s Tires and Auto Service in Melbourne, Fla., in 1970, died on Feb. 11, 2019. Gatto was born in New Orleans on Oct. 14, 1925. After graduating from high school during World War II, he joined the Marine Corps and served in the Pacific. After the war, he completed his education at Louisiana State University and then worked for Goodyear Tire & Rubber Co. for 22 years. His entrepreneurial spirit led to Gatto’s Tires and Auto Service, a six-store chain based in Brevard County, Fla.

Robert Dalotto has died

obert Dalotto Sr. died on Feb. 8, 2019. He was 79. He is remembered in his obituary as “a salesman at heart.” Dalotto retired from the corporate world in 1995 but couldn’t stay away from the tire business. He retired for the second time in 2016 from Jack Williams Tire Co. Inc. His career began in March 1961 at U.S. Rubber Co., the company which later became Uniroyal. Uniroyal was purchased by Michelin in 1991, and Dalotto served as regional manager through 1995. Before joining Jack Williams Tire in 2002, he worked for American Car Care Centers and Wholesale Tire Co. ■ MTD March 2019

ADVERTORIAL

Taking Pride In Performance Kost Tire & Auto Service’s key to success is not hard to figure out. Erwin Kost Sr., company president, states it right on the company’s website. “Our customers deserve our best service and we do whatever it takes to deliver it.” Ever since 1938, when Erwin’s father, Michael Kost Sr., founded the company in his basement, Kost Tire has adhered to this philosophy. The result has been a steady growth over the years, with the Clarks Summit, Pennsylvania-based company currently operating 23 Kost Tire & Auto Service retail locations, two commercial centers and three Big E Tire & Auto Service locations in eastern Pennsylvania and New York. Erwin Kost Jr., company vice president, began working in the family business at a very early age. “When I was 12 years old, I would come in on Saturdays and my father had me sweeping floors and stacking tires.” He progressed to doing just about any job imaginable at the dealership, including loading 600,000 scrap tires onto trailers to be recycled during one summer. He jokingly says he was able to take a brief break while getting his college degree before coming back into the family business. Kost is quick to credit the company’s employees for the quality reputation Kost Tire & Auto Service enjoys. Kost looks for “local people who are dedicated and committed to making the tire buying experience a pleasant one for all of our customers.” In short, the Kost family wants employees who “take pride in their performance.” The same holds true, says Kost, when they look at their suppliers. Kost said the company has sold Goodyear

KOST TIRE & AUTO SERVICE Erwin Kost Jr. and Erwin Kost Sr.

tires since 1938, and in the past five years has strengthened the relationship with Goodyear even more. “No other brand has as many supporters as the Goodyear brand,” says Kost Jr. Kost Jr. points to the Goodyear credit card as a prime example of a service that has enabled them to grow their clientele. “We’ve built up a large number of customers simply by offering them the credit card.” The Goodyear e-commerce program has also proven to work well in attracting new customers to Kost Tire. “At first, we were scared about it. But, we quickly found out that we were seeing people who had never done business with us. We found by taking care of this new customer and showing them the ‘Kost’ way, they became a loyal Kost customer for all their automotive service needs.” Kost now has all of its locations signed up as Goodyear e-commerce installers. “It helps Kost Tire that we are listed on the Goodyear website by building more brand recognition for us. People find us there.” Kost points out that Goodyear has provided his people with valuable training that allows them to do a better job selling and servicing their customers. During the Goodyear Customer Conference earlier this year, Kost said he could feel the power of the brand and just how committed the people were to helping dealers succeed. “If you are in retail today with any other brand than Goodyear, you’re missing out on sales. From brand awareness, support, training and assistance, Goodyear really helps bring people into your location,” says Kost. ■

Yo u r M a r k e t p l a c e

John Healy

Recent economic risk factors have been resolved with minimal negative impact on dealers

ecent discussions with dealers provide us confidence that retail sell-out continues its positive trajectory as retail conditions remain healthy and volumes improved over the prior year’s period. Surveyed dealers reported they saw unit sales volumes improve modestly (approximately 1.2%) compared to the same period last year. Last month we pointed out a few different risk factors that had recently materialized in the external atmosphere that could pose a risk to an acceleration in retail sell-out trends moving forward (effects of the government shutdown, unfavorable weather trends, raw material cost pressures). Fortunately, these issues have mostly been resolved which should create a healthier demand backdrop and act more supportive of demand trends. First, the longest government shutdown in U.S. history ended after a 35-day standoff on Jan. 25, 2019. Prior to the end of the shutdown, President Trump signed legislation that guaranteed back pay for the roughly 800,000 federal government workers impacted by the shutdown. Although the shutdown may have had some influence on volumes in January as government employees went over a month without pay, we think the overall impact was minimal and any pent-up demand should be unleashed shortly after workers receive back pay. Second, after a perplexing bout of unseasonably mild weather in December and the first-half of January, climate conditions returned to more normalized patterns, and then some, as a polar vortex swept across most of the U.S. in the back-half of January. Many auto service providers experienced heightened levels of business activity during this time, especially in regard to dead batteries which allowed dealers the opportunity to upsell customers on additional services needed for the winter season. This, in combination with a return to precipitation patterns historically consistent with this time of year (especially the northeast region which experienced above average precipitation for January), likely acted as a tailwind to helping bring our contact base of dealers their seventh consecutive month of positive volume growth. Lastly, raw material prices seem to have stabilized their upward trajectory and found a temporary top. We view this as a positive for dealers as the absence of higher raw material costs will not

Average tire tier rankings Tier

Nov ’17

Dec ’17

Jan ’18

Nov ’18

Dec ’18

Jan ’19

Tier 1

Tier 2

Tier 3

SOURCE: NORTHCOAST RESEARCH ESTIMATES

force manufacturers to implement price increases and helps keep pricing stable at the retail level which should bode well for future sell-out trends. However, with the above being said, a new conundrum has surfaced that could affect the level of volumes that dealers are customarily used to seeing around this time of year. The Tax Cuts and Jobs Act, which was theorized to be a positive for tire dealers last year, may not have the same type of effect in 2019. When this new legislation was implemented at the beginning of 2018, the majority of American workers were not proactive in adjusting their withholding to account for the new changes in the tax code and elimination of certain deductions. As we have seen so far in 2019, this has led to a lot of confusion around how the new tax laws affect each household and has caused a noteworthy reduction in tax filings when comparing IRS statistics from a year-over-year perspective. As of Feb. 15, 2019, the total individual income tax returns received by the IRS was down by 4.8% compared to the same time period in 2018. Furthermore, not only are total returns down but the refund statistics paint an even more grim picture. The total number of refunds is down 26.5% year-over-year while the average refund is down 16.7% comparatively. The new tax laws are complex, so a delay is filings can be expected, but by failing to adjust their withholdings consumers will most likely not be receiving as big of a refund as they have in past years. We believe this could have an impact on dealer sell-out as many people use sizeable tax returns toward big-ticket purchases like a new set of tires and this could spell trouble if this customary early year influx of cash is significantly reduced.

MONTHLY SURVEY A number of independent tire dealers were surveyed concerning current business trends. The results of the January 2019 survey are compared with those of January 2018.

REPLACEMENT TIRE SALES: BRINGING IN THE NEW YEAR WITH HIGHER VOLUMES Dealer commentary suggests consumer demand for PLT replacement tires rose in January compared to the same period last year. The net number of respondents indicating they saw an increase in demand year-over-year was 21.4% of contacts. We note that our tire demand index increased 3.1% year-over-year and reached the second highest level seen in six months indicating that demand trends remain not only healthy but continue to improve. See the whole report on www.moderntiredealer.com. ■ John Healy is a managing director and research analyst with Northcoast Research Holdings LLC based in Cleveland, Ohio. Healy covers a variety of subsectors of the automotive industry.

MTD March 2019

BETTER VALUE. SMARTER CHOICE.

BETTER TRACTION. LESS WEAR.

GALAXY RADIAL OTR

Alliance Tire Group offers more than 2,000 SKUs, giving your customers more choices to conquer any OTR challenge. For example, our lineup of Galaxy Radial OTR tires puts more horsepower on the ground than bias-ply tires, and gives operators a smoother ride, lasts longer and works harder than ever before. With features your customers will love, the larger, more uniform footprints of Galaxy’s Radial OTR tires deliver better traction and fuel economy, while reducing wear and lowering heat buildup. Plus, they’re backed by ATG’s aggressive new warranty and easy-touse Warranty Wizard.

Find out how the Galaxy Radial OTR lineup can help you reduce your total cost of ownership. Contact your ATG rep, visit www.atgtire.com or call (800) 343-3276.

APPLICATION SPECIFIC, PURPOSE BUILT.

NumbersThatCount

Relevant statistics from an industry in constant motion ©GETTYIMAGES.COM/NERTHUZ

8.9 million

9 million

SOURCE: MODERN TIRE DEALER’S 2019 FACTS ISSUE.

Number of truck tires imported into the U.S. from China in 2018, up 37% from the 6.5 million imported in 2017.

©GETTYIMAGES.COM/SHAUNL

Average number of seconds it takes to complete a navigation task while driving down the road. At 25 mph, the vehicle will travel the length of three football fields during that time.

Number of passenger tires imported into the U.S. from China last year. That’s a 14.2% decrease from the 10.5 million imported in 2017.

SOURCE: WWW. AAA.COM

@KREATIVKOLORS

46%

Percent of consumers who were extremely satisfied with the overall experience of buying tires from a retailer/dealer’s automotive service shop.

78.7 million

SOURCE: MTD 2018 CONSUMER SURVEY ON TIRE PURCHASING

SOURCE: WWW.STATISTICA.COM

Projected number of automobiles expected to be sold worldwide by the end of 2019.

©GETTYIMAGES.COM/YOUST

95%

How many months it would take to drive to the moon by car at 60 mph. SOURCE: WWW.FACTSLIDES.COM

Percent of a car’s lifetime that is spent parked. SOURCE: WWW.FACTSLIDES.COM

MTD March 2019

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HIGH STABILITY TREAD CORNERS ZIG-ZAG MIDDLE BLOCK SPECIAL SHOULDER SHAPE

CLX12 rogueblazer r/t TOP-NOTCH PUNCTURE RESISTANCE AND WEAR RESISTANCE ELITE OFF ROAD PERFORMANCE AGGRESSIVE PATTERN DESIGN TERRIFIC WET HANDLING PERFORMANCE

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Winter Tires

The evolution of

winter tires EVEN THE 3-PEAK MOUNTAIN SNOWFLAKE ISN’T ENOUGH ANYMORE By

Bob Ulrich

rue or false: A tire with the 3-Peak Mountain Snowflake symbol stamped on the sidewall is always a winter tire. The answer is false: A winter tire must be branded with the symbol, but that alone doesn’t make it a winter tire. True or false: The 3-Peak Mountain Snowflake symbol is a better indication of winter performance than the M+S designation. The answer is true: The 3-Peak Mountain Snowflake symbol is a performance standard, while the M&S designation is a visual standard. To better understand these answers is the first step in defining a winter tire.

MUD + SNOW The M&S designation developed in the 1970s as a way of distinguishing tires with aggressive tread patterns from bias-ply tires

CANADIAN PASSENGER TIRE UNITS SHIPPED 2004-2018 (in millions) Year 2018 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004

Overall 20.0 18.4 18.4 18.8 18.0 15.8 15.6 16.0 16.5 20.0 19.0 17.4 16.4 17.6 16.7

Winter 8.0 7.2 6.6 7.2 7.0 4.6 4.8 4.9 5.3 7.5 7.0 5.5 5.3 6.0 5.3

SOURCES: TIRE AND RUBBER ASSOCIATION OF CANADA, MODERN TIRE DEALER

%winter 40.0% 39.1% 35.8% 38.3% 38.9% 29.1% 30.7% 30.6% 32.1% 37.5% 36.8% 31.6% 32.3% 34.1% 31.7%

with the more traditional ribbed patterns, according to Woody Rogers, tire information specialist at The Tire Rack Inc. “At the time, aggressive tread is where they achieved better… traction,” he said. “Of course, they changed the compounding a little bit, too. “But M+S isn’t a performance standard. It is merely a visual standard. The tread pattern has to have at least 25% open space from a two-dimensional standpoint. And it has to have a ½-inch notch in one shoulder… every so often. “That’s it. You could take a 1965 bias rib tire, open it up just a little bit, put a notch in one shoulder, and that is an M+S tire. It has nothing to do with how much traction it actually has in the mud or on snow.” Here is the Tire Information Service Bulletin (Vol. 10, No. 7) that defines snow tire definitions for passenger and light truck tires, courtesy of the U.S. Tire Manufacturers Association (USTMA): Passenger and light truck tires meeting the following criteria are marked on at least one sidewall with the letters “M” and “S” (e.g., MS, M/S, M&S, M+S, etc.). These tires have been designed to provide better starting, stopping, and driving performance in snow conditions than non-M&S tires, and have the following general characteristics: 1.

The new tire tread shall have multiple pockets or slots in at least one tread edge that meet the following requirements based on mold dimensions:

Extend toward the tread center at least 1/2 inch from the footprint edge, measured perpendicularly to the tread centerline.

A mimimum cross-sectional width of 1/16 inch.

Edges of pockets or slots at angles between 35 and 90 degrees from the direction of travel.

The new tire tread contact surface void area will be a minimum of 25% based on mold dimensions. (USTMA)

In 1999 USTMA (formerly the Rubber Manufacturers Association) and Rubber Association of Canada (RAC) jointly defined tires for use in severe snow conditions.

3-PEAK MOUNTAIN SNOWFLAKE The mountain snowflake symbol doesn’t replace the M+S designation, it just adds to it. Here is the Tire Information Service Bulletin (Vol 37, No. 5) that defines passenger and light truck tires for use in severe snow conditions: • Tires designed for use in severe snow conditions generally have tread patterns, structure, and materials to give superior performance in snow over tires meeting the USTMA Snow Tire Definition. • Tires designed for use in severe snow conditions are recognized by manufacturers to attain a traction index equal to or greater than 110 (Snow Grip Index of 1.10) compared to the ASTM E1136 Standard Reference Test Tire when using ASTM F1805-06 snow traction test with medium packed snow surface and equivalent percentage loads. Other test methods and reference tires developed by standardizing bodies may be used provided proper correlations are demonstrated. • Tires designed for use in severe snow conditions that meet the performance criteria above qualify for marking on at MTD March 2019

least one sidewall with the letters “M” and “S” (e.g., MS, M/S, M&S, M+S, etc.) plus a pictograph of a mountain with a snowflake. The mountain profile shall have a minimum base of 15 mm and a minimum height of 15 mm and shall contain three peaks with the middle peak being the tallest. Inside the mountain there shall be a six-sided snowflake having a minimum height of one-half the tallest peak.” — (USTMA/RAC)

U.S. PASSENGER TIRE UNITS SHIPPED 2004-2018 (in millions)

“The 3-Peak Mountain Snowflake symbol brought a performance standard, albeit a very narrow one, to tire ratings,” says Rogers. “Unlike M+S, the 3-Peak Mountain Snowflake is like a merit badge. You’ve actually accomplished something.” Rogers says the standard reference test tire (SRTT) mentioned in the severe snow conditions bulletin is the Uniroyal Tiger Paw, which has a fixed specification for how it’s made and how it’s compounded. “Its performance hasn’t really changed while it’s been the SRTT.”

The Continental VikingContact 7 winter tire was runner-up in the Tire and Related Product Category of the SEMA Show’s New Product Awards competition.

Year 2018 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004

Overall 216.1 209.3 207.7 205.9 206.6 201.6 192.0 196.5 198.7 184.0 195.0 205.0 199.1 205.8 199.4

Winter 5.2 5.3 5.9 7.0 6.9 4.9 5.6 6.8 5.8 5.1 5.3 4.5 4.2 4.5 4.2

%winter 2.4% 2.5% 2.8% 3.4% 3.3% 2.4% 2.9% 3.4% 2.9% 2.9% 2.7% 2.2% 2.1% 2.1% 2.1%

SOURCES: U.S. TIRE MANUFACTURERS ASSOCIATION, MODERN TIRE DEALER

WINTER VS. SNOW Over the last 20 years, snow tires have transformed into “winter” tires because

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they can grip not only on snow and ice, but also on dry and wet road surfaces in low temperatures.

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w w w . M o d e r n T i r e D e a l e r. c o m

24/7 Roadside Assistance All trademarks, service marks and product names are the property of their respective owners. Test conducted in Q1 of 2019. Tires tested were size 215/55R17. Individual results may vary depending on vehicle type, tire maintenance, driving style, and road conditions.

Visit MaxtourLX.com and experience the performance. 21

Winter Tires They have evolved so much that the 3-Peak Mountain Snowflake symbol isn’t synonymous with what the manufacturers refer to as winter tires. When the Canadian Province of Quebec made driving on winter tires mandatory during the 2008-2009 winter season, the tires only were required to meet the 3-Peak Mountain Snowflake performance standards,

which includes branding the symbol onto the sidewall. In the last 10 years, USTMA and its members have helped define winter tires more accurately. Joe Maher, product manager for Continental Tire the Americas LLC’s passenger and winter tires in the U.S., says the overall tire market is divided into four classifications: Goodyear’s new WinterCommand is a dedicated studdable winter tire. It replaces the Ultra Grip Winter.

1. summer, a tire that doesn’t have an M+S symbol and is especially designed for summertime use; 2. all-season, which does not feature the 3-Peak Mountain Snowflake symbol; 3. all-weather, an all-season tire with the 3-Peak Mountain Snowflake symbol and marketed for year-round use; and 4. winter, or tires that feature the 3-Peak Mountain Snowflake and are marketed for use in the winter season only. Maher says there are three types of dedicated winter tires. “There’s studdable winter tires, which have holes for studs in them. Some actually have studs already in, while some get studs installed by dealers. “Then you have what’s commonly termed a performance winter tire. Performance winter tires are sometimes referred to as middle-European tires. They have a heavy focus on wet traction, not as much on snow and ice. “And then you have studless winter tires, which are also called Nordic or soft compound winter tires.” Maher says Continental’s new VikingContact 7 falls into the studless category. “The best overall performer is a studless tire. Not quite as good as a studded tire on ice, but it’s still the better overall performer.”

LATEST AND GREATEST Four tire companies have introduced dedicated winter tires since the beginning of the year: Bridgestone Americas Tire Operations LLC (Blizzak WS90, see page 24), Nokian Tires Plc (Hakkapelliitta LT3, see page 26), Continental (VikingContact 7, see page 27) and Goodyear Tire & Rubber Co. (WinterCommand, see page 58). It’s actually five if you count Goodyear’s Kelly WinterAccess. ■

MTD March 2019

Winter Tires

Bridgestone’s new Blizzak THE WS90 WILL DELIVER ‘AN EXTRA SEASON OF WINTER USE’ By

Bob Ulrich

he newest addition to the Bridgestone family of Blizzak winter tires is the WS90. It will be available to authorized Bridgestone dealers beginning in May 2019. Designed for sedans and minivans, the Blizzak WS90 tire was engineered with the latest advances in Bridgestone winter tire technology.

1. A new tread compound. The tire’s new compound, which features the company’s patented Multi-Cell technology, delivers improved stopping distance on ice compared to the tire it is replacing, the Blizzak WS80. Bridgestone Multi-Cell technology is specially formulated with hydrophilic, or water-loving, properties that attract water and draw it away from the surface of ice to enhance grip. “Every second counts, particularly when you’re trying to stop on winter roads where visibility may be poor and conditions can change quickly,” says Robert Saul, director of U.S. and Canada consumer tire product strategy for Bridgestone Americas Tire Operations LLC. 2. A specially designed tread pattern. The Blizzak WS90 tire also features a specially designed tread pattern for longer lasting performance Bridgestone says gives drivers “an extra season of winter use” compared to the Blizzak WS80. The company bases this on the following assumptions: 1) the snow season is approximately from mid-October to mid-April — six months

for very cold regions; 2) an average user would drive approximately 1,200 miles per month. 3. EdgePerformance Technology. In addition to enhanced wear performance, the Blizzak WS90 tire is equipped with the company’s new EdgePerformance Technology package. Interlocking sipes in the tire’s tread design provide more edges for enhanced snow and wet performance.

The Blizzak WS90 tire is available in 51 sizes ranging from 15 to 19 inches. They cover 86% of the passenger sedans and minivans on the road today, says Brad Robison, product manager for Bridgestone. The new tire will begin shipping to authorized Bridgestone retailers in May 2019. The tire will be sold at the same price point as the Blizzak WS80. On its website, Bridgestone says the price for the Blizzak WS80 starts at $102.99. ■

Bridgestone Americas’ Robert Saul, left, and Brad Robison both feel the winter tire segment will remain strong in the United States and Canada.

Bridgestone Blizzak WS90 vs. WS80 Wear Ice braking Snow braking Wet braking Dry handling 24

Improved Improved Comparable Improved Improved

The Blizzak WS90 is superior to the WS80 on ice and in snow.

MTD March 2019

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Winter Tires

‘Stainless steel is a brilliant idea’ NOKIAN’S LATEST LT WINTER TIRE FEATURES NEW STUD TECHNOLOGY By

Ann Neal

tainless steel studs, denser siping and winter grip impressed tire dealers who tested the new Hakkapeliitta LT3 from Nokian Tyres plc at the Copper Mountain ski resort in Colorado. “Stainless steel is a brilliant idea,” said Tom Richey, owner of Laurel Gardens Tire Service Inc. in Pittsburgh, Pa. “Unlike the studs that are a round surface, this stud has a three-pronged pin that sticks out and as it wears it does not rust.” Nokian set up driving courses to give Richey and other tire dealers a chance to test the premium winter tire for light trucks. Richey said he liked the new style stud: “It is beefy and gives you more bite.” The new tire’s siping also earned praise. “The monstrous amount of siping clears away water that’s on ice and gives you more traction. The sipes zigzag nice and pretty. You want grooves and channels fighting for you when you are on ice,” said Richey. Richey has been in the tire business for more than 40 years. His family has owned Laurel Gardens Tire Service since 1991. His wife, Cindy, is chief financial officer and their children, Tony and Tina, are managers. Laurel Gardens Tire Service generates $3.5 million in tire sales a year. The store offers retail and commercial tire sales and service as well as wholesale. Evan Zierk from Waukegan Tire & Supply Co., which operates four stores in Illinois, gave Nokian’s new tire high marks for its performance in oversteering situations.

These models helped Nokian show the changes in the shape and length of the Hakkapeliitta LT3 stud (shown on the left) versus the stud used in the prior version of the tire.

“This was the real deal,” said Zierk, who is digital sales and marketing specialist for the wholesale department at the Waukegan Tire store in Park City. “It held the turns even when I intentionally oversteered. I got control back quickly. Even as the course itself was trying to pull me to the edges, I felt like I was controlling the road, not the road controlling me. There is no other tire you could put in that situation and have that type of control.” The Nokian Hakkapeliitta LT3 is made for heavy 4x4s and pickup-type light trucks. The company says it is the first to offer stainless steel studs, which are the tire’s most important feature and are designed to offer extreme grip on slippery conditions. TSMI (Tire Stud Manufacture Index) studs for passenger cars and sport utility vehicles are typically made from aluminum or some type of alloy, which are not strong enough to withstand the weight of a light truck, according to Steve Bourassa, manager of passenger and light truck products business in North America. “For a light truck stud, you end up going to steel. When you use steel studs, you end up with rust. Rather than using the traditional TSMI stud, we have developed a unique stud using stainless steel,” said Bourassa. “This new stud also has a special base to help reinforce it to the tire, a special body to help it maintain stability, and a hard metal pin specifically designed for that shoulder area to maximize the efficiency of the stud. The base is unique, the body is unique, and the head is unique. With stainless steel studs, we avoid the rusty nail look.” The shape of the base of the new stud helps it stay in the tire. A special base rubber compound helps stabilize the stud and keep it vertical even in emergency braking conditions. In addition, the Hakkapeliitta LT3’s tread design is improved over the prior model. “The deep grooves and the blade grooves are quite efficient and will help with self-

Nokian says the Hakkapeliitta LT3 offers significant improvements in packed snow grip, ice grip and ice handling as well as wet grip versus the LT2.

cleaning properties,” said Bourassa. Dense siping throughout the tire improves ice traction and wet traction. “The sipes are also at various angles to help with both lateral and longitudinal traction. The 3D locking sipes have been modified to accommodate the heavier weight of light trucks,” said Bourassa. Along with the stainless steel studs and tread design, new technologies include sipe activators on the tread shoulders for strong snow and ice grip, brake boosters on the tread block shoulders for braking grip on snow and an “Arctic Grip” compound developed specifically for heavy-duty use. The tire is constructed with the company’s proprietary Aramid Sidewall technology for durability. The Nokian Hakkapeliitta LT3 will be available in 16 sizes from 16 to 20 inches with a speed rating Q in fall 2019. The tire will be offered with factory studding and in a non-studded version. The non-studded Nokian Hakkapeliitta LT3 is developed and tested to offer maximal winter safety in areas where studs are not permitted.■ MTD March 2019

Winter Tires

Ice braking news CONTINENTAL TRADES 2 WINTER TIRES FOR THE VIKINGCONTACT 7 By

Bob Ulrich

hy is the Continental VikingContact 7 replacing two tires? Because its performance is superior to the two Continental tires it is replacing -- the WinterContact SI in North America, and the VikingContact 6 in Europe’s Scandinavian countries and Russia. At the recent launch of the tire in the U.S. and Canada, Timur Yilkiran, project leader for Continental winter tire development worldwide, compared the performance features of the new tire versus the WinterContact SI. Engineers were charged “with improving ice braking performance, snow traction and overall handling — with little or no tradeoffs in other areas.” The result? The performance of the latest generation of the studless tire was significantly better in ice braking. It also was better in dry braking and a little better in snow traction. As a bonus, the tire is less noisy during highway driving. “Snow handling was a wash between the two tires,” he said. “Only in wet braking was the WinterContact SI superior, and there was only a 2% difference.” Yilkiran said 2% was pretty low considering wet traction is a “target conflict” when

TJ Campbell, tire information specialist for The Tire Rack Inc., tests the new Continental VikingContact 7 on snow and ice in Montreal, Quebec.

improving ice breaking is the goal. The results were similar when comparing the VikingContact 7 to the Viking Contact 6.

COMPOUND INTEREST The VikingContact 7 was developed using what Continental calls “active grip silica.” Engineers use silica in tire compounding to improve wet traction. The company combined silica with canola oil to help the tire grip on wet surfaces and stay flexible in very low temperatures. Continental says the tread pattern’s symmetric main grooves form a direct water and slush discharge from the middle straight out of the pattern. In addition, the optimal balance between grooves and blocks “always offers a high contact area,” which gives the driver more control, even at high speed. The pattern is also designed with: • interlocking elements that help provide structural stability; • “snow pockets” (i.e., wide sipes) that, when filled with snow, take advantage of snow-on-snow traction; • numerous 3D sipes with different sipe thicknesses for winter grip.

Yilkiran said the tire’s improved ice braking comes from the combination of its proprietary compound and unique tread design. Continental-snow-in-tread-19: The new tire’s tread pattern features plenty of siping, including snow pockets designed to collect the snow, then use its friction on a snowy surface for better traction.

w w w . M o d e r n T i r e D e a l e r. c o m

1+1=1 The company’s flagship winter tires are being produced in Korbach, Germany,

and Puchov, Slovakia. Perry Fu, product specialist for Continental Tire Canada Inc., said the VikingContact 6 was available in more sizes than the WinterContact SI, but wasn’t sold in North America. By replacing two tires with one, Continental “was able to take advantage of economies of scale.” The new tire line is available worldwide in 91 P-metric SKUs, including three SSR (Self-Supporting Run flat) sizes. By comparison, the WinterContact SI was available in 38 sizes in the U.S. and 44 in Canada. “We added quite a bit of range for the VikingContact 7 because we needed to improve the market coverage,” added Fu. Yilkiran said the VikingContact 7’s size complement covers 87% of the market, ranging from sub-compact cars to full-size SUVs and light trucks. Mid-size CUVs also are among the targeted vehicles. The tire will compete against the Bridgestone Blizzak WS90, Michelin X-Ice XI3, Toyo Observe GSi05, Pirelli Ice Zero FR and Nokian Hakkapeliitta R3. Continental has already started development on the successor to the VikingContact 7, according to Yilkiran. “Our standard life cycle for this product is four to five years.” ■

91 SKUs, including run-flats The VikingContact 7 is available in 91 sizes ranging from145/65R15 72T to 235/35R20 97T XL. Here is the size breakdown: 15-inch = 11 sizes; 16-inch = 16 sizes; 17-inch = 26 sizes (two SSR); 18-inch = 20 sizes (one SSR); 19-inch = 12 sizes; 20-inch = 6 sizes. “It is a big improvement in terms of the market coverage” compared to the WinterContact SI, said Perry Fu, product specialist for Continental Tire Canada Inc.

No-Credit-Needed Options

A REVIEW OF NO-CREDIT-NEEDED PAYMENT PROGRAMS ALTERNATIVES TO TRADITIONAL FINANCING CAN HELP DEALERS CAPTURE MORE SALES Ann Neal

onsumers expect to see a variety of payment options available wherever they shop, and their local tire store is no exception. One way to open up a tire store to more tire buyers is to offer affordable monthly payment plans that do not rely solely on a credit score for approval. To enable more customers to buy their tires, more than a third of the independent tire dealers who responded to a Modern Tire Dealer survey offer no-credit-needed payment plans in which consumers lease tires with the option to purchase them in the future. Nearly two-thirds of the MTD survey respondents who offer lease-purchase programs say the programs have a positive impact on their business levels. A further breakdown reveals 38% of survey respondents offer no-credit-needed payment programs to their customers. Of those, 47% said “very positive” and “19%” said “extremely positive” described their results with the tire purchase programs. Purchases such as tires can be challenging for consumers without traditional credit and the cash to pay upfront. In other cases, consumers may have access to credit but may not wish to increase their credit card balance or add another card to their wallet. Lease-to-own (LTO) agreements give tire dealers the ability to offer a payment option that meets the needs of these consumers. Instead of looking at traditional credit histories, the companies providing lease-

purchase programs consider repayment history for recurring bills such as car insurance, utilities, rent and cell phone service. Modern Tire Dealer asked several companies that offer no-credit-needed LTO programs to tire retailers for details on their programs. They are: Acima LLC, Kornerstone Credit LLC, Prog Leasing LLC (Progressive Leasing), Snap Finance LLC and West Creek Financial Inc. Thirty-five percent of people in America do not qualify for traditional financing based on their FICO scores, according to Ryan Slobodian, vice president of Snap. “They are looking for somebody who is going to help them. These are people who are driving by, and you have the option to draw them into your tire store.” The key is to promote the availability of alternative payment plans for tire purchases. “You have to do some messaging on your side,” says Slobodian. “Many of our partners hang one of our banners out on the street. They’re shocked at the number of people who see that nocredit-needed messaging and come in the door. We all know our credit scores. People aren’t going into a shop where they’ve been denied for prime financing previously. But if you invite them in with that no-credit-needed messaging, it’s a way to increase that traffic flow.” Snap recently added the option to apply for an LTO purchase plan via text message on a mobile device. “It’s all about getting outside the walls of the shop and engaging the consumer in different places where they may be,” says Slobodian.

©GETTYIMAGES.COM/COURTNEYK

PROVIDERS OF LOANS AND CREDIT American First Finance Inc. (AFF) offers both LTO programs as well as installment loan programs which do not require a traditional credit history for approval. Another provider of financing to credit-challenged consumers is EasyPay Inc., known in the market as EasyPay Finance. The company says it provides tire dealers with a non-lease credit solution for customers with good credit to no credit. The following overview also includes responses from a company that relies on credit scores for approvals, Synchrony LLC, which does business as Synchrony Financial. Synchrony provides manufacturer branded and privately branded credit cards, which are typically awarded to consumers with good, or prime, credit. MTD begins with a Q&A in which Acima, Kornerstone Credit, Progressive MTD March 2019

Leasing, Snap Finance and West Creek Financial explain how their offerings benefit a tire store, as well as their process for approving a customer for an LTO agreement. The responses from American First Finance, EasyPay Finance and Synchrony are presented separately. In addition, areas to consider when evaluating candidates who want to provide lease-purchase payment options to your business are presented in charts throughout this overview. The charts show answers from the five LTO providers featured in the article: Acima, Kornerstone, Progressive, Snap and West Creek. MTD: What services and products do you offer tire dealers? Acima: Acima offers a no-credit-needed financing solution that tire dealers can offer to their potential customers at the w w w . M o d e r n T i r e D e a l e r. c o m

point of sale. Acima’s product is 100% webbased and paperless, which equals quick turnaround from application to funding. Acima employs the largest nationwide outside sales force in the industry, which provides in-person enrollment, training, and ongoing support to its dealer partners. Kornerstone Credit: We provide flexible, no-credit-needed financing for tires and parts. Progressive: Progressive Leasing offers virtual lease-to-own services to tire and wheel dealers. Virtual lease-to-own is a flexible alternative to traditional credit that allows customers with less-than-perfect credit to obtain the tires and wheels they need to travel the roads safely. With a Progressive lease, we purchase the merchandise the customer selects from the retailer. Then, the customer signs

an agreement to lease that merchandise from Progressive. Progressive owns the merchandise, but the customer can take ownership after making all required lease payments or through an early buyout option. While there is a cost associated with Progressive’s leasing services, we don’t charge interest. Our customers may cancel the lease at any time without penalty and, if current on all payments, without any further payment obligation. Snap: Snap offers financial products for credit-challenged consumers, allowing tire dealers to take credit declines from their primary lenders and turn those into approvals. West Creek: We offer high-approval financing for consumers who don’t qualify for traditional financing. Our product

THE

EDGE

YOUR BUSINESS NEEDS “Snap not only drives customers to our store, but they can get pre-approved from their home.” —Jerad P. | American Tire Depot

Not only do we offer fast & easy ﬁnancing for your customers, Snap EDGE sends your business EXTRA customers, pre-approved and ready to shop!

| HOW? 1 - Snapﬁnance.com: We invest in extensive digital marketing to seek out qualified shoppers. Then, we get them approved and send them to your store, ready to buy. 2 - Snap Marketing: We create targeted pre-approval campaigns to drive even more customers to your store! We don’t just send you traffic, we send you approved customers with financing in hand! 3 - Extra Buying Power: We increase buying power by letting qualified customers finance more than one purchase in your store.

Automatically included when you partner with Snap, get the EDGE today! Call 844-581-7898. SNAPSALES@SNAPFINANCE.COM

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No-Credit-Needed Options offers a 100-day payment option, 12- or 24-month finance options, $500 to $5,000 credit lines, and early buyout options after the first 100 days, before the full term. MTD: How do your offerings benefit a tire dealer? Acima: Acima saves potentially lost customers, increases average invoices, and helps attract a whole new customer. Because Acima does not rely on a credit score when making an underwriting decision, approval rates are far higher than traditional credit offerings. In short, Acima helps a dealer compete for the 40% of Americans who cannot qualify for traditional financing. While traditional, or prime credit offerings are still

key to any dealer’s success, Acima offers the perfect complement — rounding out the dealer’s financing portfolio and allowing them to offer a financing solution to a far wider range of customers. Kornerstone Credit: We help increase sales up to 33% by qualifying customers who may not want to use credit or have insufficient credit to qualify for traditional financing. Progressive: More than one-third of U.S. consumers have subprime credit. This often leads these consumers to delay or even avoid big purchases. Many would-be tire customers might put off replacing their tires or walk out of tire shops disappointed and empty-handed

after being denied credit. Progressive Leasing provides these consumers with an affordable alternative to credit, helping them purchase the tires and wheels they need to travel the roads safely while solving a big problem for tire dealers — the problem of lost sales. Snap: Tire dealers are always looking for new customers. Snap Finance brings in new customers. These individuals didn’t previously buy in their establishment because there wasn’t a finance product that worked for them. West Creek: Our leasing options give retailers access to consumers who do not qualify for traditional credit. If a dealer only offers a Tier 1 credit card product, then

Questions to ask when choosing LTO payment plan providers Acima

Kornerstone

Progressive

Snap

West Creek

Length of time to qualify for your program?

Less than 48 hours from the time you have submitted the required enrollment documents to us.

A tire dealer partner can be signed up in less than 24 hours.

In most cases we can qualify a tire dealer within one business day after we receive the necessary documentation.

Dealers can sign up within minutes and immediately begin doing business. In addition, Snap will assign a client success manager to assist in on-site training and with ongoing support.

Our process takes 10 minutes for a dealer to apply, and account setup is 24 hours or less.

Dealer transaction fees?

The standard merchant discount is 0%.

We let our partners choose what works best for their business model. Ask your account manager about our options.

Progressive Leasing does not charge any dealer transaction fees. We offer our virtual lease-to-own services at no cost to the dealers.

Fees are negotiated individually based on a number of factors but are similar to credit card interchange rates.

We can customize our program to the dealer’s needs.

Technology required by the dealer?

Any internetconnected device from smartphones to desktops.

An internet or mobile connection. Our technology works seamlessly through an internetbased mobile application. A customer can text to apply using a tire dealer partner’s unique mobile application link.

No technology is required of our dealer partners. Progressive Leasing offers fully hosted solutions for retailers with limited technical infrastructure, while investing in custom technical point-of-sale integrations for more technically advanced retailers.

An interconnected device is all that is needed.

A computer or tablet with internet access. Our entire process is online, and no additional software is needed.

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MTD March 2019

No-Credit-Needed Options they are not providing options to 40% of the U.S. consumer market. Most retailers experience anywhere from a 5% to 30% boost to their business with West Creek. MTD: What sets you apart from other finance companies? Acima: Price, customer focus and merchant support set Acima apart. Here’s a breakdown. 1. Price: Acima’s offering has no merchant discount or fees. 2. Customer focus: Acima reports customer payments back to Experian. This helps our no-credit and low-credit customers build credit history. By reporting to Experian, Acima is working to help customers advance up the credit spectrum to where they can qualify for a dealer’s traditional prime options. No other subprime financing companies offer this benefit. Our customer focus is why

Acima is the highest rated, most reviewed subprime financing company on Google. 3. Merchant support: Acima’s nationwide sales team and in-field support offer the dealer a level of service and ongoing support that is second-to-none. Kornerstone Credit: Our internet-based mobile application takes 30 seconds or less to complete, with an almost instant response. It’s currently the quickest in the industry. We make ourselves available anytime our tire dealer partners need us (24/7). We ensure that our partners’ customers are happy, so they’ll come back to the store to do more business. We offer virtual and in-person training, whichever is better for our partners’ sales teams. Progressive: Many things differentiate Progressive Leasing from other lease-toown providers. Here are four. 1. Progressive Leasing is the largest

and longest tenured virtual lease-to-own provider in the United States. We’ve helped more customers and more retailers than any other player in this space, and that experience allows us to partner with dealers to help drive material, sustainable growth. 2. Having done millions of leases in nearly 30,000 retail locations, we have a large, qualified customer base to market to on behalf of our retail partners. 3. Our in-house, U.S.-based technology and customer and merchant support teams offer highly reliable and scalable turnkey and custom technology solutions and world-class customer and retailer support. 4. Our data science team employs a broad data set of customer and market data along with the latest machine learning technology to maximize approval rates for each and every retailer we serve. Snap: Three areas set us apart.

Questions to ask when choosing LTO payment plan providers Acima

Kornerstone

Progressive

Snap

West Creek

Your approval rate?

Industry wide, tire merchants will see approval rates in the low-to-mid 80% range.

Our approval rate is as high as 80% with our top performing partners.

Customer approval rates vary between 50% and 80%, dependent on the retailer. We believe in transparency and will not promise approval rates that we believe we cannot sustain.

There are a number of variables that impact approval rate, so each dealer’s experience will vary. We are told by many dealers who have switched from similar products that Snap’s rates are very competitive if not better.

Our average dealer sees approval rates of 80%+.

Your approval amounts?

Typically tire merchants will see approvals up to $3,000.

We approve up to $5,000.

Our average approval amount is $1,750.

Snap has approval amounts of up to $3,500.

They vary from $500 to $5,000.

Your close rate?

Our in-house account reps and nationwide sales team pull out all the stops to ensure you get applications funded. That said, around three out of four approvals will book.

We have partners who convert up to 90% of their applications into sales which can also increase their business close rate by up to 40%.

Customer close rates vary between 60% and 90%, dependent on the retailer.

Snap’s close rate will vary depending upon multiple factors but is typically 80% – 85%.

We see an 80% conversion rate for our average dealer partner.

C H AR T C O NT I NU E D ON PAG E 3 6

MTD March 2019

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No-Credit-Needed Options 1. Snap’s superior decisioning and analytics lead to higher approval rates and higher approval amounts, resulting in industry-leading conversion rates. 2. A consumer-focused brand and experience. We know that a happy customer returns over and over again. Snap’s goal is to treat the customer the right way. As we partner with tire dealers, we know that this is key to a successful relationship. Snap’s commitment to the customer is apparent in our Google ratings (4.5/5 stars) and internal survey metrics (82% of Snap customers would recommend Snap to a close friend or family member). 3. Snap Edge — our proprietary revenue generation engine for Snap tire dealer partners. Snap Edge is designed to find consumers and to lead them to our retailer partners. We know that as our partners grow so will our business grow. It is this alignment that is crucial to a true partnership. West Creek: West Creek was built by subprime credit experts. We use big data and machine learning to give our dealers industry-leading approval rates. More approvals lead to a larger effect on our dealers’ bottom lines.

MTD: How do you evaluate customers beyond FICO scores? Acima: Without giving up our secret sauce, there is more to a person than their FICO score. We believe FICO is an outdated solution to a new age problem.

Acima doesn’t care much about what happened years ago, we care about where your customers are now. We require three things from a customer: be a real person who we can identify, have a traditional checking account in good standing, and have a source of reliable income. If consumers can meet those three criteria, they should apply and be confident they will be approved. Kornerstone Credit: We utilize proprietary data that looks beyond credit scores. We believe a customer’s job and banking history are worth more than their FICO score. No matter a customer’s credit history, they can still be approved for up to $5,000. Progressive: We look at many data points besides credit scores including things like employment and banking history. By doing so we are able to approve many customers with less than perfect credit or with a thin credit file or no credit file. Snap: There are numerous factors that come into play beyond FICO. Snap uses over 9,000 data points in its machinelearning models versus other credit models that use about 200. It is this significant difference in the amount of data and how it is compiled that leads to the Snap difference in approval rates. West Creek: West Creek utilizes over 6,000 data points to build its machine

learning models. The average competitor uses “off the shelf ” models and minimal data points. This enables us to look for reasons to say “yes,” while others are looking for a reason to say “no.” MTD: How can dealers contact you? Acima: marketing@acimacredit.com, (801) 297-1984, www.acimacredit.com. Kornerstone Credit: Ben Carr at (801) 960-6653, bcarr@kornerstonecredit.com, www.kornerstonecredit.com. Progressive: retailersupport@progleasing.com, (855) 222-0801, www. progleasing.com. Snap: snapsales@snapfinance.com, (833) 442-8840, www.snapfinance.com. West Creek: 844.WC.TIRES (844) 928-4737, www.westcreekfin.com/mtd.

A PROVIDER OF LEASES AND LOANS MTD posed the same questions to American First Finance (AFF), which offers both installment loan programs and LTO programs. MTD: What services and products do you offer tire dealers? AFF: 1. Bank installment loans are offered in 40 states. 2. Retail installment contracts are offered in 21 states. 3. Leaseto-own contracts are offered in 47 states. MTD: How do your offerings benefit a tire dealer? AFF: AFF offers many features and benefits on its products, including low or no down payments, no processing fees

Questions to ask when choosing LTO payment plan providers

Acima

Kornerstone

Progressive

Snap

West Creek

How long for a tire dealer to be paid the full amount of the sale?

24-48 hours.

Funding occurs within 24 hours via ACH (automated clearing house).

ACH payments are typically initiated the same day as the customer transaction, or the next day depending on when the lease agreement is signed.

We fund within 2 business days.

West Creek provides funding to dealers via ACH transfer 24-48 hours after the customer’s items are delivered.

How long for an LTO application to be processed?

The application is quick and easy to fill out. Acima issues decisions within seconds of clicking “submit.”

Our mobile application takes 30 seconds or less to complete and the approval happens in a matter of seconds.

Many customers complete our application in 5 minutes or less and nearly all of our customer lease applications are processed within 10 seconds of submission.

The Snap application takes about 5 minutes to complete, and a decision is rendered in 5 seconds.

Less than 1 minute.

MTD March 2019

My ambition is to be the one they trust.

You want to be the shop they count on for everything from a simple oil change to a complex problem. By oﬀering your customers 6 or 12 Months Promotional Financing* options, you’ll help increase your customers’ purchasing power, increase your store traﬀic, raise average transaction size and build repeat business. Just right for your future.

Find out how we can help you realize your ambitions. Visit synchronybusiness.com/auto or call us at 844-880-2009.

What are you working forward to?

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No-Credit-Needed Options AFF has developed technology integrations allowing for a single application process which seamlessly flows from primary lender (Citi, CFNA and Synchrony private label credit cards) to secondary lender and tertiary lenders. This allows dealers to offer a finance solution to all customers, and on all of their products and services. AFF won’t ask the dealer to split consumer sales tickets into one for product and another for labor and services. AFF can lawfully finance all products, services and add-on products. The customer owns the product on day one and the dealer does not have to contend with individual state lease-to-own guidelines. The process is paperless. No invoice uploading is required and transaction funding happens on the next business day.

to finance all products, services and addon products. With a loan, the customer realizes day-one ownership of their tires, as opposed to gaining ownership after they pay off their lease. MTD: What sets you apart from other finance companies? AFF: All products, services and labor are included. Shops that sell tires and wheels offer many other repair services and add-on products. The power of “yes” to a multi-product sale versus a tire-only sale allows the dealer to better service the customer, achieve a higher close rate and increase same store sales all by offering an American First Finance solution.

AFF’s contract durations, up to 24 months, create a more manageable payment plan for the customer. Installment agreements and loans are reported as credit repayments as opposed to trade line payments. With on-time payments on their installment transactions, the customer can potentially build better credit. Non-prime customers can qualify for better pricing plans or rate reduction plans with installment programs. MTD: How long does it take a dealer to qualify for your program? AFF: Fully completed dealer applications are approved in about 48 hours.

©GETTYIMAGES.COM/COURTNEYK

on installment contacts and installment loans, a 101-day early payoff discount, contract terms up to 24 months and product offerings across all 50 states. Higher approval amounts and lower, more manageable payment plans allow the customer to purchase tires and related services with a greater tread life versus a less expensive set of tires. This means a better product for the consumer and a higher average ticket for the dealer. AFF’s approvals are up to $5,000, which allows all four tires to be purchased, additional repairs to be completed, and in some cases a remaining open-to-buy amount available for subsequent purchases. AFF offers bank installment loans through its partner FinWise Bank, and this solution allow the dealer’s customers

MTD: What are the dealer transaction fees? AFF: Dealer transaction fees vary but can be as low as a 0% merchant discount rate. MTD: What technology is required by the dealer? AFF: A dealer only needs to have internet access to offer the AFF secure, dealer transaction portal. MTD: What is your approval rate? AFF: AFF consistently delivers approval rates around 80%. MTD: What are your approval amounts? AFF: AFF approves transactions up to $5,000 including tire and wheels, repair, service and add-on products. MTD: What is your close rate? AFF: The “close rates” in our automotive portfolio are in the 70% to 80% range. MTD: How long does it take for a tire dealer to be paid the full amount of the sale? AFF: AFF funds its merchants on a next-business-day basis. MTD: How long does it take for consumers to qualify for financing? AFF: Our application is one of the shortest in the industry, with only 18 fields for the consumer to complete. In most instances, the application can be completed in less than 3 minutes, with real time decisions on approvals and denials. MTD: How do you evaluate customers beyond FICO scores? AFF: AFF develops its own proprietary underwriting models and operates its own underwriting systems, based on 20-plus years of experience in the non-prime consumer finance industry. AFF utilizes the latest technologies and data analysis techniques to convert “big data” into useful, actionable data. MTD: How can dealers contact you? AFF: Sales@americanfirstfinance.com.

A LOOK AT 2 CREDIT PROVIDERS EasyPay Finance provides tire dealers with a non-lease credit solution at their pointof-sale that offers customized approvals for customers with good credit to no credit. Synchrony is a source of promotional financing that allows tire dealers to offer customers “same-as-cash” financing that waives accrued interest if the purchase amount is paid in full in a set time period. MTD: What services and products do you offer tire dealers? EasyPay Finance: EasyPay Finance MTD March 2019

w w w . M o d e r n T i r e D e a l e r. c o m

©GETTYIMAGES.COM/JOYIMAGE

provides tire dealers with a non-lease credit solution at their point-of-sale, with a unique approach that offers customized approvals for customers with good credit to no credit. EasyPay Finance doesn’t give every customer the same rate; they get the rate that is right for them. Our program includes approvals up to $5,000, a two-minute prequalification process, six credit tiers to assure customers get the rate they deserve, funds sent same day for completed transaction by 4 p.m. EST; and availability in 49 states. There is no money down for consumers, which means higher closing rate. There is no cost to dealer other than low 2.99% transaction fee. We generate and send dealers preapproved customers through our national affiliate network. Synchrony: 6 and 12 months promotional financing (subject to credit approval), consumer-only, revolving line of credit. MTD: How do your offerings benefit a tire dealer? EasyPay: EasyPay will help approve up to 80% of a tire dealer’s prime lender declines and increase their revenue up to $30,000 per month when used as their alternative customer financing solution. Unlike leases, EasyPay has no restrictions on financing repair services; customers can finance any ratio of parts and labor. Synchrony: Synchrony Car Care generates increased sales and loyalty with a revolving line of credit. Consumers can also purchase gas, parking, car washes and more. MTD: What sets you apart from other finance companies? EasyPay: EasyPay has a number of differentiating factors, including an 18-year history of providing superior financing services. EasyPay is not a lease, but a traditional installment finance contract. Unlike leases, EasyPay has no restrictions on financing repair services — customers can finance any ratio of parts and labor, assuring the tire dealer stays compliant with local and national regulations. EasyPay gives customers the rate that’s best for them based on their credit history and other determining factors. EasyPay transactions are completely transparent, with fully disclosed APRs. EasyPay reports consumer transactions to credit bureaus, giving customers a chance to build positive credit. There are no upfront costs to the consumer.

EasyPay generates pre-approved customers for dealers through its national affiliate network. Synchrony: Revolving product with no interest promos, repeat usage, multiple promotions, brand extension, marketing/ advertising support, customer satisfaction, free in-store signage, engaging account management, insight sharing and much more. MTD: How long does it take a dealer to qualify for your program? EasyPay: When a dealer submits their enrollment form we can usually get them up and running within 24 hours. Synchrony: A dealer can submit for enrollment within minutes online or over the phone. MTD: What are the dealer transaction fees? EasyPay: 2.99%. Synchrony: Comparable to and often less than bank cards or major credit cards. MTD: What technology is required by the dealer? EasyPay: All you need is internet access and a computer or tablet. Synchrony: Internet access. MTD: What is your approval rate? EasyPay: Up to 80%. Synchrony: Proprietary. MTD: What are your approval amounts? EasyPay: Up to $5,000. Synchrony: A consumer can qualify for financing on purchases of $199 or more (subject to credit approval). If the desired

financed amount is not met, the account holder can call and request a credit line increase. MTD: What is your close rate? EasyPay: 80% to 90%. Synchrony: Proprietary. MTD: How long does it take for a tire dealer to be paid for the sale? EasyPay: Funds are sent the same day if the transaction is received by 4 p.m. EST. Synchrony: 24-48 hours. MTD: How long does it take for consumers to qualify for financing? EasyPay: Customers can be pre-qualified without affecting their credit score in as little as 2 minutes. Synchrony: Instant decisions. Application process is very short. MTD: How do you evaluate customers beyond FICO scores? EasyPay: EasyPay understands that there are a number of reasons a customer may not have a favorable credit score, and goes well beyond this when evaluating a consumer’s creditworthiness. EasyPay’s proprietary algorithm evaluates how a customer handles their bank accounts, as well as several behavioral patterns that are not credit related. Many customers are also approved with a zero credit score. Synchrony: Proprietary. MTD: How can dealers contact you? EasyPay: www.easypayfinance.com, sales@easypayfinance.com, (866) 791-0915. Synchrony: www.synchronybusiness. com/auto. ■

Preventive Maintenance

Experts answer this question:

of these systems. It is certainly not like the old days when we use to say 50,000 miles on shocks is the time to replace. Wear and tear is the focus, not mileage.” Under both normal and adverse conditions, just about any suspension part can be damaged and wear out, but most should last 50,000 to 80,000 miles before repairs are required, says Doug Taylor, product marketing manager for Arnott Inc. “Air suspension, while offering load leveling and a more comfortable ride, also offers its own challenges,” he says. “While air suspension components can last eight to 10 years, like other rubber components such as hoses, wipers and tires, the rubber air bladder will begin to dry rot and develop tiny holes around the area where the rubber air spring folds upon itself. “At first, the air suspension compressor will continue to pump up the springs, but in time the holes will become too numerous or too large, and the compressor will burn out and stop working from overuse.” Air suspension components typically fail between 80,000 to 120,000 miles, said Aalok Joshi, director of product management for Cardone Industries. “This range can be greatly affected by the complexity and configurability of the system, aka driving modes, driver behavior and road conditions.” Inspect wheel hub assemblies, U-joints and center support bearings on a regular basis, says an SKF USA Inc. spokesperson. Although these components do not have a specific replacement schedule, they can start to develop symptoms such as noise or vibration issues that may indicate it’s time to replace them. It’s also important to ask customers if they are experiencing any issues. A visual inspection of U-joints and center support bearings can determine if there is grease leakage or worn rubber supports. By grabbing the driveshaft and moving it, you can see if there is any excessive play. Wheel hubs also can be inspected for excessive movement. “Typically, a hub will not have more than 5 thousandths end play,” he added. In all cases, technicians should also refer to OEM specs for allowable limits. ■

Godfrey Williams, left (with Barry Steinberg), looks for the cause of a banging noise the driver complained about. He determined a lower control bushing was the culprit, and sent the client a video of the complete multi-point inspection.

5 signs an air suspension system needs repair 1. Customer complains that at least one corner of his vehicle is dropping over time. 2. The dashboard suspension warning light comes on. 3. The air suspension compressor stops working. 4. Upon a visual inspection, the technician sees leaking oil around the shock’s body or holes on the air spring. 5. Customer hears knocking noises when going over bumps. SOURCE: DOUG TAYLOR, PRODUCT MARKETING MANAGER, ARNOTT INC.

COURTESY OF ARNOTT INC.

hen it comes to suspension performance, preventive maintenance can be a hard sell — even as the vehicle sinks closer to the road surface. So we asked two former Modern Tire Dealer Tire Dealers of the Year, Alpio Barbara and Barry Steinberg, and a number of suspension parts companies one question: When should suspension parts be replaced? “We often ask our clients if the car ever makes any unusual noises going over bumps or around turns just to get them talking about the ride aspects of their vehicle,” said Barbara, owner and president of Redwood General Tire Service Co. in Redwood City, Calif. “Suspension noises are often described with words such as tapping, rattle, or squeak over bumps, or just something that wasn’t there before. “Luckily, a trained mechanic can identify the cause of most issues with some simple inspections. Different failures make different noises, so after road testing a vehicle and duplicating the noise the customer has described, a technician can begin to inspect the area the noise is coming from and begin to inspect those components for wear.” Barbara said suspension component wear is usually diagnosed by testing for excessive movement or play. “The fact of the matter is suspension parts all wear at different rates and in different ways depending on driving conditions, driving habits, as well as other factors. So rather than set a specific value for time and mileage for these parts to fail, it is our job in the automotive industry to help educate customers on what the suspension of their vehicle will do for their daily driving habits, as well as how wear and failure of these components can lead to serious safety concerns.” Steinberg, owner of Direct Tire & Auto Service, a six-store chain based in Watertown, Mass., said if the part is showing enough wear or play that it will adversely affect alignment angles, he will recommend replacement. “With the advancement of crash avoidance systems in the modern automobile, suspension systems must be evaluated and diagnosed by an informed and highly trained technician to understand the many dynamics

COURTESY OF CLARK GOODPASTER/DIRECT TIRE

WHEN SHOULD A VEHICLE’S SUSPENSION PARTS BE REPLACED?

Eventually the rubber on air suspension components like these GM SUV air shocks will wear out providing repair opportunities for garages.

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Past, Present, Future: Gender Diversity

Female tire dealers ‘FOR THE BEST IN TIRES, SEE CHANICE KOBOLOWSKI’

Bob Ulrich

erhaps the most famous female tire dealer of all time is Chanice Kobolowski. She was owner of Kobolowski Tires in Chicago. Doesn’t ring a bell? Here’s a hint: The dealership’s tagline was “For the best in tires, see Chanice Kobolowski.” Any fan of the film “Uncle Buck” would recognize the name Chanice Kobolowski. Played by Amy Madigan, she was the girlfriend of the title character, played by John Candy. And despite her popularity, that about sums up the number of fictional female tire dealers on the silver screen. In the real world, however, women have been successfully running independent tire dealerships for at least 100 years. Modern Tire Dealer knows that because it has been interviewing them since August 1919.

GENDER ANALYSIS OF THE TIRE BUYING PROCESS According to BrightLine Marketing research, men decide which brand to purchase and retailer to frequent more often than women when buying tires. 59.6%

2018

40.4% 59.5%

2017

40.5% 59.5%

2016

40.5% 60.3%

2015

39.7% 60.4%

2014

39.6% 61.3%

2013 0%

38.7% 10%

20%

30%

Men SOURCE: BRIGHTLINE MARKETING LLC (WWW.BRIGHTLINEMARKETING.COM)

40%

50%

Women

60%

70%

Juanita Purcell shared the MTD Tire Dealer of the Year Award in 2004.

Diane Hennelly shared the MTD Tire Dealer of the Year Award in 2013.

In our first issue, under our original name Tires & Accessories, we ran a story on Mrs. N.E. Love, who managed a store in St. Louis (see the reprinted article on pages 46 and 48). In our second issue, we talked with Mrs. Josephine Roberts, manager of a United Tire Stores outlet in Indianapolis. It shouldn’t surprise anyone in our industry that the average tire dealer is a Caucasian male in his 50’s. But there has always been room for women interested in running or owning a tire dealership. Both Love and Roberts said so. Love said a career in the tire business is all right for women “who are adapted to it,” and there is nothing disagreeable about it. She found it pleasant competing with men, and said she always received every courtesy from her male competitors. Most of her customers were men, she added. Roberts echoed those views. “If a woman makes a serious study of her business, she can compete with the men in handling tires. “Personally, I like the tire business because I would rather sell to men than to women and most of the tire buyers are men.”

WOMEN TIRE BUYERS “Less than 50% of an independent tire dealership’s customers are women.” 2006 MTD Women & Tires Dealer Study

“Women buy… 65% of new tires.” Par Excellence magazine, Dec. 2009 “Women buy 60% of all passenger tires.” Bonnie Marlow, assistant program manager, K&M Tire Inc., K&M Tire Dealer Trade Show, 2013 There is some discrepancy as to the number of women tire buyers, or the influence women have on the tire buying process. Randy Ladd, owner of BrightLine Marketing LLC, has been tracking tire purchasing since 2009. “The BrightLine Tire Survey has included interviews with 15,000 tire decision makers each year since 2009,” he says. “The ‘decision maker’ label is very important because the BrightLine Tire Survey asks respondents questions about why they selected a specific tire brand or tire retailer. Only the decision maker can answer these questions. MTD March 2019

100 years of female tire dealers in charge The glass ceiling at the retail level has been broken many times Modern Tire Dealer has compiled the following alphabetical list of some of the female managers and executives who have worked in and run independent tire dealerships in the U.S. over the last 100 years. Of special note are four women with additional claims to fame. Pam Gatto-Gallo and Freda Pratt-Boyer are the only two women elected president of the tire industry’s national association. In Gallo’s case it was the National Tire Dealers & Retreaders Association (which eventually morphed into the Tire Industry Association, or TIA) in 1997. In Pratt-Boyer’s case it was TIA in 2014. The only two women to be named Tire Dealer of the Year by MTD are Juanita Purcell (along with her husband, Bob Purcell) in 2004 and Diane Hennelly (along with her husband, Dan Hennelly) in 2013. Sue Adams, owner/manager, Big O Tires Inc. franchise, Englewood, Colo. Beth Barron, CEO, Chabill’s Tire and Auto Service LLC, Morgan City, La. Lindsey Beer, operations manager, Best-One Tire & Service, Upland, Ind. Tammy Belldina, manager, Tire Lady’s Rainbow Tire, Morgantown, W.V. Maria Borrelli, president, Pro 1 Tire Service Inc., Brooklyn, N.Y. Freda Pratt-Boyer, senior auditor, Purcell Tire & Rubber Co., Potosi, Mo. Joanne Brock, president, Adams-Zuker Tire Co., Cedartown, Ga. DD Coley, president, Consumer Tire Inc., Chardon, Ohio Pam Cooper, owner, Alltread Tire Co., Katy, Texas Kristen Cristy, owner/president, Reeves Tire & Automotive Co., Joplin, Mo. Christine Croucher, owner, Tire Lady’s Rainbow Tire, Morgantown, W.V. Suzy Darter, owner, Best One Tire & Auto Care of Marion, Marion, Ind. Carol Poff-Delabalma, owner/manager, T.P. Tire Service Inc., Arcata, Calif. Pat Fleischmann, director of first impressions, Community Tire Pros & Auto Repair, Phoenix, Ariz. Cathy Flemmer, manager, Lignite Tire Service, Hazen, N.D. Audra Fordin, owner, Great Bear Auto Repair & Auto Body, Flushing, N.Y. Ann Gaither, chairman, J.H. Heafner Co., Lincolnton, N.C. Tish Gammage, secretary/treasurer, Adams-Zuker Tire Co., Cedartown, Ga. Pam Gatto-Gallo, president, Mike Gatto Inc., Melbourne, Fla. Cheryl Gossard, president, K&M Tire Inc., Delphos, Ohio Connie Hartje, owner/manager, Hartje Farm, Home & Tire Center Inc., La Valle, Wis. Terry Hawthorne, co-owner, Hawthorne Wholesale Tire, San Marcos, Calif. Diane Hennelly, co-owner/CFO, Hennelly Tire & Auto Inc./Tire Choice, Fort Lauderdale, Fla. Dee Dee Henry, manager, Discount Auto Parts and Tires, Lake Charles, La. Connie Honey, owner, North Jackson Tire Center LLC, Tullahoma, Tenn. Molly Ivey, owner, Pueblo Tires & Service, southern Texas Sherri Johnson, manager, Gatto’s Tire & Auto Service, Palm Bay, Fla. Joy Kokaisel, co-owner, Norm’s Tire Sales Inc., Roseville, Minn. Cheryl Lentz, owner, Lentz Tire & Service Center, Trinity, Ala. Denise Littlefield, president, Stratham Tire Inc., Brentwood, N.H. Nora Love, manager, Wearwell Tire Store, St. Louis, Mo.

“Although roughly half of the consumers who are invited to take the BrightLine Tire Survey are female, female respondents are less likely than male respondents to say they were the decision maker. “As a result,” says Ladd, “the 2018 BrightLine Tire Survey (indicated) that only 41% of tire decision makers were female (see chart on page 44).” Pam Gatto-Gallo, owner of Gatto’s Tires and Auto Service, a six-store chain based in Melbourne, Fla., always caters to the customer, whether male or female. w w w . M o d e r n T i r e D e a l e r. c o m

Sherry Clay-Marcoe, president, Jeff Clay & Sons Inc., Kissimmee, Fla. Jill Marcotte, partner/chief supply chain officer, Dealer Tire LLC, Cleveland, Ohio Katie Marsh, co-owner, Dan the Tire Man LLC, Cave Creek, Ariz. Dot McGowan, vice president, Adams-Zuker Tire Co., Cedartown, Ga. Kalina Petersen, co-owner, Alignment Pros-Point S, Gillette, Wyo. Chris Picarello, manager, Middle Island Discount Tire, Middle Island, N.Y. Cecelia Picarello, owner, Middle Island Discount Tire, Middle Island, N.Y. Patti Piscione, owner, Carter Tire Sales & Service, Elkhart, Ind. Juanita Purcell, executive vice president/board member, Purcell Tire & Rubber Co., Potosi, Mo. Helen Ralls, president, Ralls & Ladd Tire Service, Chowchilla, Calif. Josephine Roberts, manager, United Tire Store, Indianapolis, Ind. Ann Schmidt, president, Wells-Schmidt Tire Co. in Wood River, Ill. Jo Ann Scott, co-owner/manager, Clark’s Tire & Automotive, Taft, Calif. Lisa Sheerin, owner, Network Tire Inc., Warrington, Pa. Katrina Smith, manager, Phoenix Auto Center Tire Pros, Phoenix, Ore. Linda South, co-owner, South Tire & Auto Service Inc., Cocoa Beach, Fla. Gail Sowles, owner, Clark’s Tire and Automotive, Taft, Calif. Christie Stock, president, Associated Tire Stores Inc., Logan, Utah Cynthia Strunk, owner, Gulf Coast L&P Inc./RNR Custom Wheels & Tires, Moss Point, Miss. Kim Batson-Sutphen, owner/president, Batson Tire & Automotive Center Inc., Bryan, Texas Ruth Trower, co-owner/secretary/treasurer, Clay Dooley Tire & Auto Service, Bloomington, Ill. Rosemary Tucker, owner, Tucker Tire Co., Covina, Calif. Wilma Veldman, co-owner, The Tire Rack Inc., South Bend, Ind. Patty Virgilio, CFO, Callaghan Tire Inc., Bradenton, Fla. Roshie Weightman, co-owner, Morpheus Investments, dba Tire Works Total Car Care, Las Vegas, Nev. Rita Williams, CFO, Brahler’s Truckers Supply Co., Jacksonville, Ill. Tracey Williams, vice president, Jack Williams Tire Co. Inc., Moosic, Pa. Debby Wisdom, manager, Wisdom’s Tire Co., West Monroe, La.

When she took over the reins of the National Tire Dealers & Retreaders Association in 1997, she told MTD that if she was manning the desk and a man asked to talk with a man, she would defer to one of her male employees. “It’s all about the sale,” she said at the time. More than 20 years later, she answers in the same way. “I don’t think we face that question anymore, or rarely. Whoever the customer feels more comfortable with, that is who he or she gets. It’s about the sale.”

100 YEARS AGO… In our first issue, published one year before women had the right to vote, we ran the aforementioned story on Mrs. N.E. Love (the “N” stands for Nora), who set up a Wearwell Tire store in St. Louis. Her story, reprinted on pages 46 and 48, is 100 years old, and her Wearwell brand tires have long since disappeared from the aftermarket. But some of her methods ring true today. As an aside, the author of the story, F.A. (for Francis Albert) Behymer, worked for the St. Louis Post-Dispatch for 64 years. ■

Past, Present, Future: Gender Diversity TIRES & ACCESSORIES

IRE selling as a business career for women is all right, according to Mrs. N. E. Love, but she qualifies her opinion very strongly by prefixing “some” to women. However, she has proven herself decidedly capable not only as a saleswoman, but as an organizer and executive as well. Her chief selling approach is a dash of yellow paint and in her comparatively short selling career she has established yellow tire sentinels in several mid-west cities. That in her particular case the “yellow streak” pays is demonstrated by the fact that during the first six weeks her St. Louis branch was running it did a business totaling five figures.

A Woman, Yellow Paint and Tires! Here’s a Combination That Has Been Stirring Things Up in St. Louis - A Yellow Spread That Proves to be A Sales Builder and How It Is Applied by Mrs. Love BY F. A. BEHYMER

RS. N. E. LOVE has arrived in St. Louis. You can tell that by the vermilion splash at the northeast corner of Twelfth and Chestnut streets and the other kind of splash in the local tire pool. When Mrs. Love went to St. Louis for the Wilson Tire and Rubber Co., of Springfield Ill., the first thing that she did, after picking out the Twelfth and Chestnut streets corner as a good place to make her jump into St. Louis tiredom, was to hunt up a painter and order him to take a bucketful of his yellowest yellow paint and spread it over the front and side of the building. Mrs. Love says it’s orange. Well, all right, let’s call it orange. Whatever its name it did the business. Every motorist who came by, and Twelfth street and Chestnut street swarm with machines, SAW that corner and wondered who was moving in and what was the main idea anyhow.

Mrs. Love gave the paint time enough to soak in and the curiosity of motorists long enough to bubble over, and then she handed the painter a piece of paper and a sketched design of a tire rampant, coming at you at an angle of 45 degrees, and told him to put that on the Chestnut street side of the building and to put it there big! The painter went to work and at the end of the day the motorists homeward bound read on the yellow (beg pardon, orange) side of the building, inside of the tire rampant, the word WEARWELL; on one side, “The tire that is true to its name,” and on the other side, “Save 40 per cent on tires and tubes.” That was what you might call a good sign. That is, it caught the eye, it introduced to motorists a tire with a name which would stick and wear well, backed up with a slogan easy to remember, and clinched with a proffered saving of 40 per cent. MTD March 2019

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No Lost Motion Here No time was lost in getting the goods on hand to back up the sign. Truckloads were dumped on the sidewalk and carried inside and piled up without any particular system, the racks not having arrived. The thing was to get ready for the motorists who wanted to save that 40 per cent. They kept piling the tires up until there were $18,000 worth, and about $2,000 worth of tubes, and then, about six weeks ago, the yellow doors were thrown open and the motorists were invited to come on in and get the tire that is true to its name. Mrs. Love says they came to such effect that in less than six weeks the store sold $10,000 worth of tires. Mrs. Love has the distinction of being the only woman tire agency manager in St. Louis and the only tire agency manager of any sex who has perceived the efficacy of yellow paint and spread it on to the limit. For six years Mrs. Love has been opening Wilson company branches and she has opened each one by making it look like a puddle of yellow paint. She has caught the eyes of four cities that way and plans to catch the eyes of more cities. It chanced that Mrs. Love was a neighbor of James W. McIlvaine, president of the Wilson company, who thought she would make a tire woman and backed his judgment by sending her to Minneapolis to open the company’s first tire branch. With yellow paint and the elimination of the middlemen’s profit, she made it go, and from there she went to Chicago and gave that town the yellow paint treatment, which was good for the town and good for the Wilson company. From there she went to Kansas City with her Wearwell yellow paint and her Wearwell Tires. And now she’s showing the Missourians! And she likes St. Louis so well that she is going to stay there. She will be the permanent manager of the St. Louis branch, but that does not means that she will not go here and there from time to time and put yellow spots on the map. She spent part of last winter in Washington and Virginia, with yellow paint and Wearwell tires in mind, and it will not be long, probably, before there will be an agency in Washington or Richmond or both. And Oklahoma looks good for next winter, with great numbers of California tourists taking the Southern route. That was how Mrs. Love got into the tire business, and she likes

it so well that she expects to stay in always. She likes it, she says, because it is connected with automobiles and she likes automobiles. And as a selling proposition it is just one article and she is able to offer it at bargain factory prices. It may not be generally known, but a woman likes to sell bargains as well as buy them. Mrs. Love gets no end of enjoyment out of her tire bargains. She reaches the users, aside from the yellow paint and the 40 per cent sign, by newspaper advertisements on a modest scale, and by circularizing every automobile owner in her territory. Those circulars, which give the prices of the different treads and the tubes, bring her a big lot of business, she says. All that the customer has to do is to fill out a blank form and send it to her. He gets the tire back by express or parcel post, C.O.D. Most of the buyers never see the tire until they take it out of the post office or the express office, but Mrs. Love says they never send it back and ask for their money.

Circulars Her Ammunition Since she opened the St. Louis branch she has been circularizing Missouri, Southern Illinois and Arkansas, and the results are pouring in. The yellow store is two blocks from Locust street, which is the automobile street and the tire street, but Mrs. Love doesn’t care to be crowded. She thinks her yellow paint has a better chance at a corner like Twelfth and Chestnut. And rents are cheaper. And one is not bothered by “lookers,” who go from store to store. As for the tire business as a career for women, Mrs. Love says it is all right for some women. Some, in this case, she says, means a whole lot. Meaning that it is a good business for the women who are adapted to it. There is nothing disagreeable about it. Most of her customers are men, and she has found that they like bargains as well as women. She has found it pleasant competing with men and has always received every courtesy from her male competitors and feels that she holds her own with them, and so all is well at the place of the yellow paint. Mrs. Love has with her Ralph and Carl McIlvaine, sons of the president of the company, who are in training to take charge of yellow-front branches, and Mrs. A. M. Pears, who was in the hotel business at Madison, Wis., until Mrs. Love persuaded her to go into tires.

This is the Wearwell branch conducted by Mrs. Love at Twelfth and Chestnut Streets, St. Louis. The store front and side wall are painted in a screaming yellow that cannot be overlooked by the occupants of the many cars that pass this busy corner daily.

MTD March 2019

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10% net profit GET YOUR FAIR SHARE FOR THE PRODUCTS AND SERVICE YOU PROVIDE By

Dennis McCarron

oey Doughnuts works at Sal’s Automotive. Has for years. Joey got set up with a 401(k). There’s no company match, but he puts away about 6% of his $70,000 a year salary (let’s just make the math easy and assume he never gets a raise — poor kid). At the end of his long and successful career working at the shop, Joey has about $700,000 socked away for retirement. Now let’s look at Sal himself. The entrepreneur. Turned his back on the corporate world to make a name for himself. Sweated out the first couple years — sometimes thinking he made a big mistake. Some weeks, he went without a paycheck, so he could afford to pay his people. The business had its bumpy start. With a lot of hard work, trust in his employees, and an honest work ethic, Sal’s Automotive turns a profit. Not much, but it’s consistent. From about $1.5 million dollars in sales, Sal’s turns 2% net profit. $30,000 a year. It’s not a lot, but the other shops Sal talks to seem to be the same. Matter of fact, he’s heard that’s about industry average. Sal is proud of his shop, and he should be. Yet, Sal is starting to feel a lifetime of working on cars, working in the cold, kneeling on hard concrete. He doesn’t complain, but he has sure slowed down on any work he personally does in the shop. He tries to stay “up front” and talk with customers. A lot is going through Sal’s mind lately. He hasn’t really set up a plan — you know — what’s he going to do when he actually decides to call it a day? His daughter wants nothing to do with the business. She’s a successful physician’s assistant. Maybe one of the techs or sales staff wants to take over? Maybe one of the competitors a few miles away, or the big chain store one town over has some interest? Sal doesn’t know what the future holds, but he spends an awful lot of time thinking about it. If Sal were to put his business on the market today, he would, or at least be advised, to use a term called EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) to figure out what his business is worth. Essentially, since Sal runs a pretty clean business, let’s assume his EBITDA is $50,000. Sal’s Automotive is in a desirable location, good town, too. So let’s further assume there’s interest by a few parties. Sal can collect what is called a multiplier of his EBITDA of about three times the base amount. Sal can sell his business for $150,000. Yikes. Let’s not even talk about what part of that $150k is actually Sal’s. We haven’t mentioned debt or taxes yet. Wait… what?

How is Sal’s employee enjoying nearly three quarters of a million dollars in retirement and Sal is trying to find a buyer so he can retire on less than $150,000? Easy. Sal accepted the “industry norm” of about 2% to 3% net profits. If Sal had managed his business financially and made the tough, results-oriented decisions he needed to make, Sal would have earned 10% net profit year-over-year. That would have resulted in $150,000 a year in net profit on the same volume of sales. At three times EBITDA, that puts Sal in a much more comfortable $450,000. And since he was making $150,000 a year net profit, Sal also paid off all his debt. He even bought the land the business sits on, so now he can sell the business and be a landlord, earning an additional $75,000 a year. If Sal lives for 10 years after he sells his business, he will have accumulated $1.2 million dollars in retirement. That makes a lot more sense, doesn’t it? Earning 10% net profit isn’t easy. It isn’t supposed to be. If it were, there would be four shops on every corner of America, and two more in the middle of every street. It’s not easy, but it’s the fair share, the payout the business earns for the risks it takes (10% net does not go in the owner’s pockets). The business has a high probability of worker injury. It has a high probability of vehicle damage. Relative risk of an oil out, wheel off, an angry customer who wants their money back even though the business didn’t’ do anything wrong they were just the “last ones to touch it.” Lawsuits. Long hours. Ten percent should be the bare minimum a business should accept for all the risk it takes. The owner should demand these results. Because eventually, there will come a day where it’s someone else’s turn to take the risk. And like a lot of entrepreneurs, many won’t be eligible for social security. All they can rely on is the profits from the sale of the company. If owners play their cards right, maybe become a landlord. $150,000 or $450,000 plus rent. As an owner it’s up to you. Every year, you have a chance to be fair to your customers, your employees, and yourself. Earning 10% isn’t a crime. It’s 10 cents on every dollar sold. The rest (90 cents of every dollar) goes to vendors, employees and expenses. Make good sales. Earn gross profit from those sales, pay your bills, and start earning your retirement. ■

EVERY YEAR, YOU HAVE A CHANCE TO BE FAIR TO YOUR CUSTOMERS, YOUR EMPLOYEES, AND YOURSELF. EARNING 10% ISN’T A CRIME.

Dennis McCarron is a partner at Cardinal Brokers, the leading brokers in the tire and automotive industry (www.cardinalbrokers.com). To contact McCarron, email him at dennis@cardinalbrokers.com.

MTD March 2019

European Notebook

A positive year behind them and more to come from Falken Europe By

John Stone

alken Tire as part of the Sumitomo Rubber Industries Group is a leading tire manufacturer that is recognized as a major global brand that continues to gain market growth as a very ambitious company within the industry. Apart from being well known in North America, they are also viewed as a popular option throughout all European countries and particularly in the ultra-high performance sector which can be firmly attributed to the brand’s ongoing success in motorsport events. I was recently invited to meet with Markus Bogner, managing director and chief operating officer of Falken Tire Europe GmbH at the division’s headquarters in Offenbach, just outside Frankfurt, Germany, to exclusively discuss the European group’s successes in 2018 and potential achievements for the year ahead in 2019. Bogner explained that Falken’s main marketing focus has been through its positive involvement in motorsport throughout Europe for the past 20 years. They are currently racing two cars — a new Porsche and an established BMW team — and it is anticipated that success on the track will continue during the coming year. Bogner adds, “However, in the past couple of years we have significantly broadened our market exposure and in particular turned toward professional (European) football sponsorship deals which at present totals an impressive 24 leading clubs across Europe including Liverpool FC (UK), Athletico Madrid and Seville (Spain) as the larger, more well-known clubs.” It is also interesting to note that for 2019 the company has been appointed as the official sponsor of the 26th IHF Mens Handball World Championship in Denmark and Germany, which recently took place in January, and Bogner says, “This additional sponsorship project into European handball further enhances our promotional commitment in sporting events as part of Falken’s brand strategy to continually expand our media presence in a number of different corporate avenues.” When questioned about sales and product advancements during 2018, Bogner pointed out that the company had continued to grow its OE sales over the past two to three years and over the past 12 months they had commenced supplying tires for the new Mercedes G-Class Luxury SUV model which is fitted with its WildPeak A/ T3WA and AS210A patterns in size 265/60R18. He adds, “This latest OE partnership success further highlights our proven success in the SUV and off-road performance market sectors and we anticipate other premium vehicle manufacturers will join forces with Falken for exciting new product fitments in the future.” Predictably my next question was, “It sounds like Falken is not just about performance tires in Europe then, so what other advancements has the brand made recently?” Markus explained, “Yes, that is correct, and in general there has been a progressive expansion of our tire range with an extensive amount of new sizes

Markus Bogner credits Falken’s involvement in racing for the European group’s success.

The Falken Europe motorsport team races with a new Porsche and an established BMW team.

becoming available in the all-season, winter, truck and bus market sectors during the past 12 months. This includes the Eurowinter HS01 pattern which now offers 99 size options plus the Eurowinter HS01 SUV with 39 current sizes. At the same time, more sizes have been added to the popular Falken G1388 tire which specializes in regional transport and construction site operations.” It also seems that Falken has been busy when it comes to tire testing in consumer magazines with impressive performances in Germany and the UK in 2018 by beating many more traditional premium manufacturers. Bogner firmly believes this has created a crucial turning point with the Falken brand now being recognized as a genuine contender in the premium tire field throughout Europe. He is sure this can be credited to the company’s special design features through its unique 4DNANO process. This process has now been implemented across the entire tire range and ensures an even better grip and overall road performance. When I asked Bogner about what lies ahead this year he confirmed that there will be more OE product launches along with additional expansion of the tire size assortment which will incorporate new high performance patterns for the SUV and run-flat patterns in order to gain even wider corporate presence in Europe. He says, “There is no doubt that 2018 was a very successful year for us with strong sales results in all European countries and volumes exceeded our expectations. We confidently expect this momentum to continue which will be boosted by our new research and development facility in Germany which is now fully operational.” Bogner is adamant that Falken, having been able to meet the changing market demands in specific versions of tires for various OEMs and vehicle lines, can proceed even further as a leading brand in 2019, not just in Europe but on an international basis. ■ John Stone has been working within the global tire industry for the past 28 years. In 2004 he launched his own consulting company, Sapphire Media Service, which caters to business media clients around the globe. Stone also writes for tire and automotive-related publications in Europe, South Africa and Asia.

MTD March 2019

Focus On Industry

Point S dealers invest in digital tools ADDING TOYO IS ‘AN OPPORTUNITY FOR GROWTH’ By

Joy Kopcha

here’s a lot of noise about online tire sales, but the leaders of Point S in the U.S. and around the world want their members to focus on the bigger picture. The internet has changed how tires are sold at the front counter, too. “When you don’t price online and you don’t have a good presence online, you’re missing that consumer experience from the very first touch point, from the first time a consumer begins shopping for tires,” says Walter Lybeck, CEO of Tire Factory Inc., the cooperative of independent dealers that markets itself as Point S USA. “I believe the experience online is what should be focused on. That’s something we can do as an organization that other organizations cannot do.” Overall, Point S dealers in the U.S. have been slow to add tire prices and sales onto their websites, but Lybeck says the group is turning the corner and “more are willing to adapt.” That makes it an opportune time for the cooperative to roll out a new platform of tools to help its tire dealers maximize their online capabilities, and combine them with the consumer trust dealers already have earned in their brick-and-mortar storefronts. The group’s members are investing $200 a month to improve the digital marketing tools. The new All-Trac platform is designed to help tire dealers throughout the consumer buying process, from online search and

Three more takeaways Toyo. Tire Factory’s home base is in Portland, Ore., and for 52 years one tire dealer has had exclusive access to the Toyo brand in the Pacific Northwest. That exclusive partnership with Les Schwab Tire Centers Inc. ended Jan. 1, 2019. (Read all about it on page 8.) By February 2019 the four Point S warehouses in the U.S. began stocking Toyo tires. (Toyo was already a big brand for Point S in Canada.) “It’s an opportunity for growth, especially in the Northwest,” Lybeck says. To add Toyo in the U.S., Point S ended its domestic partnership with Cooper Tire & Rubber Co. Memphis. In December 2017 Point S achieved a big goal when it found its first distribution partner in the eastern U.S. Mike Nussbaum, owner of Nussbaum Distributing Inc., is delivering to the first six Point S stores in the Memphis region. Point S has hired a full-time recruiter in Memphis, Gary Ward, to lead the effort to build up that network. “It’s been a banner year,” Lybeck says. Marketing. The cooperative is unveiling a new marketing campaign in 2019, and it makes two promises to consumers. When tires are bought online and the installation appointment is made online, consumers can expect to be in and out in one hour. Plus, they’ll ride on a 30-day satisfaction guarantee. The tagline: No Stress With Point S.

Three Point S CEOs attended the 2019 dealer meeting for U.S. tire dealers. From left, Walter Lybeck, CEO in the U.S., Christophe Rollet, CEO in France, and Fabien Bouquet, CEO of Point S International. The leaders expect new digital tools will help the U.S. dealers beat the 10% increase in sales they recorded in 2018. Same store sales also were up 10% in 2018.

tire selection, to appointment setting, measuring customer satisfaction after the sale, and finding a path to pick up declined services.

1. Online scheduler: When consumers visit the website of any Point S tire dealer in the U.S., they’ll have the ability to shop for tires, select maintenance services and make the appointment online. With All-Trac, the scheduler will access the dealer’s tire inventory, the Point S warehouse inventory, the schedule and abilities of the store’s technicians, and the overall appointment calendar so consumers can choose a time that works. 2. Reputation management: Within a couple days of a consumer’s visit to a Point S location, a customer service agent will call the customer and ask “how did we do?” The company has partnered with BPO Solutions Group and a specific team is handling Point S phone calls, and also will manage after-hours questions submitted via online chats. 3. Declined services: Forty-five days after a consumer has declined one or multiple automotive services on an invoice, a customer service agent will call the customer to remind them of the work that needs to be done, and find out if it’s been addressed. If it’s been completed elsewhere, they’ll make a note of that. If it still needs to be done, the caller will attempt to set up an appointment. Fabien Bouquet, CEO of Point S International, says the group’s tire dealers in the UK have been focusing on declined services for the past two years, and have been able to add, on average, $65,000 in sales per location, by engaging with consumers and reminding them of those needed services. Bob Fox and his son Nick Fox own two Point S stores in Montana. Nick Fox says the company’s database shows consumers decline $150,000 of automotive services at each of their stores every month. They’re piloting the program for other Point S dealers, and they recouped $6,000 in services in the first three weeks. ■ MTD March 2019

Focus On Industry

Federal releases a new kind of M/T tire XPLORA MTS IS ONE OF FOUR NEW PRODUCTS FOR 2019 By

Joy Kopcha

hat does a hybrid ultra-high p erformance tire and mud-terrain tire look like? Federal Tire North America LLC has the answer — the Xplora MTS. Two years ago Federal considered this a concept tire, but Chairman Jamie Ma says the reaction to the beefy tire with wide, directional grooves was so strong the company is bringing it to market. Production of the Xplora MTS began in January, and the first shipments are arriving this month in 20-, 22- and 24-inch sizes. In the fourth quarter Federal will add 17- and 18-inch sizes, and 26-inch sizes will follow in early to mid-2020. Here’s a look at the initial lineup: 20 inch: 22 inch:

24 inch:

35x12.50R20LT 121Q 10PR 35x12.50R22LT 117Q 10PR 37x12.50R22LT 127Q 10PR 37x13.50R22LT 123Q 10PR 40x15.50R22LT 128Q 10PR 35x12.50R24LT 114Q 10PR 37x13.50R24LT 120Q 10PR 38x15.50R24LT 127P 10PR 40x15.50R24LT 128P 10PR 42x15.50R24LT 130Q 8PR

“We had private showings at SEMA

and received such positive feedback we decided to bring the prototype MTS to market without any changes,” Ma says. Steve Hutchinson, who is working as an advisor to Federal, says the tire is “as mean as it looks.” The catch is, the tire isn’t meant for off-road duty. It’s marketed for Jeep and lifted light truck enthusiasts. “It’s for the city dweller who has a high desire for considerable styling.” The Xplora MTS features: • V-shaped grooves, which provide tire rigidity and protect against chips and cuts; • an armor-like appearance, with massive tire blocks that provide steering and traction control for stability, safety and performance; • wide, directional grooves, which reduce hydroplaning on wet roads, and also provide for added comfort and reduced noise; and • linear shoulder blocks to help with comfort, and improve steering control.

The tire features a new silica-infused compound — it’s a combination of an UHP tire compound and a M/T tire compound. Ma says Federal saw an opportunity to serve the consumers who want the looks of the off-road life, while sticking to the pavement. And even though there’s been a flash of M/T tire introductions in recent years, Ma says, “everybody has been very conventional with the traditional M/T, and nothing has been revolutionized to match the fashion trend.”

LOOKING TO GROW

Federal Tire is “a company on the move,” says Steve Hutchinson. He’s working as an advisor alongside Chairman Jamie Ma, center, and Joseph Kao, operations manager, far right. In addition to launching the Xplora MTS, Federal will release new R/T, A/T and UHP tires in 2019.

Federal opened its North American office in Torrance, Calif., two years ago, and is making its move into the market, Hutchinson says. “We have a ways to go, but our roots are taking hold. We’re expanding our distribution and we have a lot of good things coming in the next few years. New products. New people. We’re hiring. We’re a company on the move.”

The Xplora MTS is designed for the urban cowboy, and “has a brave, out-ofthis-world kind of look,” says Ma.

As it works to expand its reach in the U.S., Federal is looking to fill in areas of the Midwest and Southeast with additional tire distributors in those regions. Because the company doesn’t have its own warehouses in the U.S., it relies on distributors to buy containers of tires, as well as those retailers who can purchase containers and then distribute the tires to their own stores. Tom Hofmann is CEO and president of Freedom Tire Distributing Inc., and for the last four years his Corona, Calif.,-based company has distributed Federal tires throughout southern California — from Los Angeles to Mexico. He says the Xplora MTS is a prime example of what Federal adds to his product lineup. “It’s unique,” Hofmann says. “That’s where Federal has done well for us.” Freedom Tire Distributing carries the full Federal line, and Hofmann expects the Xplora MTS to be a good addition to the mix. Hofmann says he thinks the stylized tire for light truck and Jeep owners is “a great opportunity. The trendy stuff always starts here (in California.)” ■ MTD March 2019

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Focus On Industry

Goodyear introduces new tires, new sizes and more e-commerce By

Bob Ulrich

oodyear Tire & Rubber Co. introduced a number of consumer and commercial tires at its 2019 Customer Conference in Dallas, Texas, last month. Mike Dwyer, chief customer officer in North America, told attendees the new consumer tires were based on requests from dealers who sell Goodyear tires. So was the addition of key sizes to the Wrangler Fortitude HT line. “You told us consumers wanted a performance tire that also delivered superior braking on wet roads, (and) that you wanted Goodyear products that revitalized our winter offerings,” he said. “And finally, you told us you wanted a product in the right size that can fit the changing cargo van market, the ones used by small businesses, big businesses and companies delivering packages, the ‘last mile.’ “We took your feedback to heart.”

GOODYEAR EXHILARATION The Goodyear Eagle Exhilarate is the newest top tier, ultra-high performance all-season tire in the U.S. and Canada. “The importance of wet traction is key to winning in this segment,” said Dwyer. It will replace the Eagle F1 Asymmetric All Season in April 2019. Mike Pulte, general manager of product marketing, said the tire features a new mold shape, a new tread pattern and new compounding. The Eagle Exhilarate is far superior in wet traction, and better in winter compared to the F1 Asymmetric All Season, said Rob Schott, chief engineer of research, development, engineering and quality. It performs comparably “across the board” in dry conditions. Both tires feature a 45,000-mile limited tread wear warranty. The premium-priced Exhilarate will compete against tires like

The Fortitude HT has added three C-type sizes. Goodyear’s Amy Buehner says they cover “the entirety of the full-size cargo van C-type requirements.”

The new Goodyear Ultra Grip RTD is “a winter tire,” said Cary Budzinski, senior director of commercial sales for Goodyear in the U.S. and Canada, to attendees.

The heavy hitters attending the 2019 Goodyear Customer Conference in Dallas included, left to right: Ed Fabrizio from Wholesale Tire Distributors; Joe Tomarchio from Monro Inc.; and Stephen Clave and Paul Pittner from Dunn Tire LLC.

the Continental ExtremeContact DWS06, the Bridgestone Potenza RE980AS and the Michelin Pilot Sport A/S 3+.

TIER 2 AND 3 WINTER TIRES Dwyer also talked about the new Goodyear WinterCommand, a mid-tier tire that “represents a complete evolution of our winter line up. (It is) so important we renamed our offering to reflect the improvements.” The WinterCommand replaces the Ultra Grip Winter, which had been in the company’s lineup for seven years. Pulte said the new tire is superior to its predecessor in ice braking and ice traction, with “no sacrifices” in other performance categories. The tire line features three specialized tread patterns designed to be paired with specific vehicle types for optimal, customized performance. All three patterns are engineered with full-depth zigzag sipes. It will be available in the third quarter in 54 studdable sizes up to 20 inches, including “a lot of growth sizes for CUVs and SUVs,” said Pulte. They also are stamped with the 3-Peak Mountain Snowflake designation. The tire will compete against the Firestone Winterforce 2 and General Altimax Arctic 12. Goodyear’s top tier winter tire is the Ultra Grip Ice WRT. In addition, Goodyear will not only launch a third-tier winter tire, the Kelly WinterAccess, for the economy consumer, but also build on last year’s introduction of the Eagle Enforcer All Weather tire for law enforcement vehicles with an Enforcer winter tire.

C-TYPE CARGO VAN SIZES The cargo van market “is rapidly changing around us, as we are seeing tires sizes not common in North America,” said Dwyer. “These unique sizes have grown over 30% at OE since 2015. MTD March 2019

“To capture share in this segment, we are expanding the Wrangler Fortitude HT line.” Goodyear is adding 13 sizes to the line. Three of the new sizes are commercial service radial (C-type) sizes: 235/65R16C, 195/75R16C and 225/75R16C. “The C does not stand for Load Range C,” said Amy Buehner, product marketing manager for all-terrain and specialty tires. “The C does stand for commercial service radial, and it’s nomenclature that comes to us from the European Tire and Rim Technical Organization… the European version of the Tire & Rim Association. “This is an incredibly important distinction, because neither a passenger tire nor an LT Load Range C tire in the same size can carry the load of the C-type tire.” To help avoid confusion, Goodyear molded “Load Range E” or “Load Range D” underneath the size on the sidewall. The C-type tires are manufactured in Gadsden Ala., said Buehner. The 235/65R16C just started production and is available for order now. The two additional C-type sizes will be available in the second half of this year. The other 10 new sizes are heavy-duty LT sizes ranging from LT215/85R16 to LT285/60R20. The expansion increases the total number of sizes to 48. There are a lot of tire options open to owners of full-size cargo vans, said Dustin Lancy, marketing manager for commercial tires. For example, there are at least six tire options – four different tire lines –for the Mercedes-Benz Sprinter 3500, including a nonretreadable Wrangler Fortitude HT and a retreadable Endurance RSA ULT. “So whether (full-size van owners) are interested in acquisition costs or… cost per mile, we will be able to service them,” said Lancy.

Original equipment fitments Goodyear keeps adding to its total One of the ways Goodyear Tire & Rubber Co. says it helps drive customers to dealers who sell Goodyear tires is with targeted original equipment fitments. Mike Dwyer, chief customer officer in the U.S. and Canada, told tire dealers attending the recent 2019 Goodyear Customer Conference in Dallas that the OE landscape is changing. “There is more competition than ever before as (other) tire manufacturers look to build the relationships Goodyear developed long ago and continues to enjoy.” Goodyear brand tires are fitted on four of the five top selling vehicles in the U.S., he said. “And we remain the number one supplier on full-size trucks, a position we have held for the past 20 years.”

The company has what it calls “premium” fitments on the Ford F series, Chevy Silverado, GMC Sierra and Ram Truck. “We also understand that to maintain our position, we must focus on both present and future fitments,” said Dwyer. Goodyear recently landed an electric vehicle fitment with Mercedes-Benz, a division of Daimler AG. It also is supplying tires for the new Hyundai Kona EV and its first two Volkswagen fitments in the U.S. “For 2019, Goodyear commands 110 OE fitments, creating loyalty that drives consumers to your stores.” According to Modern Tire Dealer research, Goodyear’s OE market share in the U.S. and Canada is 24%.

w w w . M o d e r n T i r e D e a l e r. c o m

The Goodyear Endurance RSA ULT tires on this Mercedes-Benz Sprinter van have a matching pattern for retreading.

REGIONAL TRUCK TIRES Goodyear also launched two truck tires for regional fleets: the Goodyear Fuel Max RTD and Ultra Grip RTD. “Long-haul is still the biggest segment in North America,” said Dave Beasley, vice president of commercial tires. “But regional haul is gaining ground quickly.” Beasley said that growth is driven by

1. growth in e-commerce, 2. the increase of distribution hubs, and 3. more demand for last-mile delivery. The Fuel Max RTD is Goodyear’s premium drive traction tire. Thanks in part to a new low rolling resistant tread compound, it is designed to balance enhanced fuel efficiency with long miles to removal and traction. It will be available will be available during the fourth quarter of 2019 in the following sizes: 295/75R22.5 LR G/H; 11R22.5 LR G/H), 255/70R22.5 LR H; 255/70R29.5 LR G; and 225/70R19.5 LRH. The new Goodyear Ultra Grip RTD is designed for regional trucks that run in severe weather conditions. The company says it features a proven tread design and compound for long, even wear; 25/32-inch tread depth for long miles to removal; complex sipe geometry with variable tread depth to help provide excellent traction as the tire wears; and conical stone ejectors to limit stone trapping. The all-season truck tire also will hit the market during the fourth quarter, in size 11R22.5 LR H.

ONLINE TRUCK TIRE SALES Goodyear’s e-commerce program for commercial tires is in the testing stage, and will officially launch in the third quarter of this year. It will be available via Goodyear’s commercial tire website, www.goodyeartrucktires.com. Owner-operators and small fleets will be able to buy Goodyear truck tires online with a credit card and select an installation date and time with a participating dealer. “We are in a unique position to draw on our experience with e-commerce for consumer tires and be the first to bring a commercial program to the market,” said Lancy. Like its consumer tire counterpart, the online truck tire program will provide participating Goodyear commercial tire dealers with delivery commissions and installation revenue. ■

TPMS

Toyota Sienna 2007-18 PHOTO AND ARTWORK COURTESY OF TOYOTA MOTOR SALES U.S.A. INC.

SUBJECT VEHICLES: 2007 – 2018 Toyota Sienna. RELEARN PROCEDURE? No. SPECIAL TOOLS NEEDED? Yes, a Toyota Techstream.

he tire pressure monitoring system (TPMS) on 2007 – 2018 Toyota Siennas is designed to provide warning when tire inflation pressure of one or more road tires is low. A tire pressure warning valve sub-assembly equipped with a tire pressure sensor/transmitter is installed in each tire and wheel assembly. The sensor measures the air pressure and internal temperature of the tire. These measured values and the transmitter ID are transmitted to the tire pressure monitor antenna and receiver assembly on the body via radio waves. This data is then sent to the tire pressure monitor electronic control unit (ECU) from the tire pressure monitor receiver. If the transmitter ID has been previously registered, the ECU compares the measured air pressure value and the standard value. When the value is less than the standard value registered in the tire pressure monitor ECU, the tire pressure warning light on the instrument cluster will turn on. In order to reset the warning threshold in response to changes in tire pressure values due to tire type and installation position changes, a tire pressure warning reset switch is used. This switch is used to initialize the system after certain repair procedures. Under the

following conditions, the system may not function properly: • Facilities or devices that use similar radio wave frequencies are located in the vicinity. • A radio device of similar frequency is used near the vehicle.

• A large amount of snow or ice is stuck to the vehicle, especially around the wheels or wheel housings. • The ID of the tire pressure warning valve and transmitter has not been registered with the ECU. • Tires and wheels are installed that are

Figure 1: Locating the tire pressure monitoring system (TPMS) reset switch.

MTD March 2019

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Figure 2: Identifying the data link connector (DLC3) terminals.

not equipped with a tire pressure sensor. • A type of film that affects radio waves has been affixed to the windows. • Snow tires or tire chains are used. • The battery of the sensor has been depleted. • Wheels other than manufacturer factory wheels are being used. If wheels other than those specified are used, the system may not function properly because of interruptions in transmissions from the tire pressure sensor. Depending on the tire type, the system may not function properly even though the specified wheels are used. • The compact spare tire is installed. The compact spare does include a tire pressure sensor and transmitter. • If the system was initialized with tire pressures not at the specified values.

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NOTE: The tire pressure warning light may turn on due to natural causes such as natural air leaks or tire pressure changes caused by temperature. In this case, adjusting the tire pressure will turn off the warning light. NOTE: If the warning light turned on due to very low outside temperatures that caused decreases in tire pressure (such as in the winter), adjust the pressure to a higher pressure suitable to cold conditions. Tire pressure decreases by about 1.45 psi (10 kPa) for every 18 degrees Fahrenheit (10 degrees Celsius) drop in ambient temperature. NOTE: The compact spare tire is not equipped with the tire pressure warning valve and transmitter. If a tire goes flat, the warning light will not turn off when the flat tire is replaced with the spare. When the standard tire is repaired, inflated to the specified level and returned to the vehicle, the warning light will go out. When the tire pressure warning light does not go off, or when it comes on during driving, check tire pressure and adjust as necessary. The warning light should turn off within a few minutes. If the warning light is

Figure 3: Locating the tire pressure sensor transmitter identification.

still on even though the tire pressure is correctly adjusted, the tire could be punctured. Repair as necessary. If the warning light turns on within several hours after adjusting the tire pressure, the tire may have a slow air leak. Repair as necessary. If the warning light is on or blinks after all above situations have been investigated, there is a malfunction in the TPMS. See service information.

TPMS RESET PROCEDURES NOTE: The system will need to be initialized when tires are replaced with tires of different pressures; tire pressure sensor and/or tire pressure monitor ECU are replaced. See “Initializing tire pressure monitoring system.” When a tire pressure sensor and/or tire pressure monitor ECU is replaced, the sensor ID must be memorized (registered) by the tire pressure monitor ECU prior to system initialization. See “Tire pressure sensor registration.” When the tire pressure warning light does not go off, or when it comes on during driving, check tire pressure and adjust as necessary. The warning light should turn off within a few minutes. NOTE: If the negative battery terminal is disconnected, initialize the following power systems after the terminal is reconnected: window control system, back door system, sliding door system and the moon roof. Refer to the owner’s manual or appropriate manufacturer service information.

INITIALIZING THE TPMS CAUTION: Set tire pressure within the specified range before initializing. Do not MTD March 2019

TPMS

Figure 4: An exploded view of the tire pressure sensor.

push the reset switch without adjusting tire inflation pressure of all four tires. Otherwise, the low tire pressure warning light may not come on even if the tire pressure is low, or it may come on when the tire inflation pressure is actually normal. If you push the reset switch while the vehicle is moving, initialization is not performed. NOTE: When a tire pressure sensor and/ or tire pressure monitor ECU is replaced, the sensor ID must be memorized (registered) by the tire pressure monitor ECU prior to system initialization. See â€œTire pressure sensor registration.â€? NOTE: When initializing the system, the current tire condition is stored as a standard. Perform the tire pressure adjustment after the vehicle has sufficiently cooled down. If it hasnâ€™t sufficiently cooled, increase the air pressure in the tires approximately 3 psi to 4 psi (20-30 kPa). NOTE: The initialization mode can be terminated by making a short circuit between terminals No. 4 and 13 of the DLC3 connector (located under left side of instrument panel). During initialization, the tire pressure sensor measures the inflation pressure of the tires, and registers the signals that are transmitted into the tire pressure monitor ECU at a frequency of one per minute. The initialization process is completed when the signals from the four tires have been received. The initialization process is canceled if the ignition switch is turned to the OFF position prior to the completion of initialization. To restart initialization, the tire pressure warning reset switch must be pressed again. 1) Set the tire pressure of all wheels to the pressure specified on the tire and loading information label. 2) With the vehicle stopped and the parking brake applied, turn the ignition switch ON. NOTE: Initialization is normally completed within five to six minutes. If initializa-

Figure 5: Disengaging the bead using a tire remover.

tion has not been completed successfully, DTC C2177/77 is set after the vehicle is driven for 20 minutes or more. 3) Press and hold the tire pressure warning reset switch until the tire pressure warning light blinks three times at one-second intervals (see Figure 1). 4) Turn the ignition switch OFF. 5) Connect the Techstream to the DLC3. Turn the ignition switch ON, and turn the Techstream ON. 6) Enter the following menus: Chassis / Tire Pressure Monitor / Data List. 7) Confirm that the expected tire pressure data of all tires is displayed on the Techstream screen. Initialization can be terminated by connecting terminals 13 (TC) and 4 (CG) of the DLC3 (see Figure 2).

TIRE PRESSURE SENSOR REGISTRATION NOTE: When a tire pressure sensor and/or tire pressure monitor ECU is replaced, the sensor ID must be memorized (registered) by the tire pressure monitor ECU prior to system initialization. To perform this procedure, a Toyota Techstream must be used. It is not necessary to register the sensor ID(s) when only tire rotation is performed. NOTE: Before beginning the registration process on vehicles where tire pressure sensors have not been replaced, retrieve sensor transmitter ID(s) using Techstream or by reading the ID on the tire pressure sensor. If a sensor is being replaced with a new one, make a note of the eight-digit number (transmitter ID) before installation, as it cannot be seen after the sensor is installed (see Figure 3). Set the tire pressure of all the wheels to the pressure specified on the tire and loading information label. 2) With the ignition switch OFF, connect the Techstream to the DLC3. 3) Turn the ignition switch to ON . MTD March 2019

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Figure 6: Installing the tire pressure sensor.

4) Enter the following menus: Chassis / Tire Pressure Monitor / Utility /ID Registration. NOTE: If this step is not completed within 300 seconds, registration mode will be canceled. 5) Perform the procedures displayed on the Techstream. NOTE: It may take up to about five to six minutes to update the tire pressure data. If the values are not displayed after several minutes, perform troubleshooting according to the inspection procedure for DTCs C2121/21 to C2124/24. If the IDs have not been registered, DTC C2171/71 is set after three minutes or more. 6) Confirmation of transmitter ID registration: a) Enter the Techstream menu items in this order: Chassis / Tire Pressure Monitor / Data List. b) Confirm that the expected tire pressures of all tires are displayed on the screen.

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DEMOUNTING/MOUNTING PROCEDURES CAUTION: The tire should be demounted from the wheel using the tire changer manufacturer’s instructions. Use the following information to avoid damage during the demounting/mounting procedures. NOTE: The system will need to be initialized when tires are replaced with tires of different pressures and when the tire pressure sensor and/or the tire pressure monitor ECU is replaced. NOTE: When a tire pressure sensor and/ or tire pressure monitor ECU is replaced, the sensor ID must be memorized (registered) by the tire pressure monitor ECU prior to system initialization. See “Reset procedures.” NOTE: If the negative battery terminal is disconnected, initialize the following power systems after the terminal is reconnected: window control system, back door system, sliding door system and the moon roof. Refer

CAUTION: The use of tire sealants is strictly prohibited for vehicles equipped with the TPMS. Tire sealants can clog tire pressure sensors. CAUTION: Be sure to reinstall tire valve caps, or dirt or moisture could get into the valve core and cause air leakage. Use only the original valve cap. If any other valve cap is used, it may corrode or melt, and become extremely difficult to remove. NOTE: The average life of the grommet of the tire pressure sensor is approximately five years, at which time it must be replaced. If the valve is leaking air, but it is less than five years old and the grommets are in good condition, retighten the valve nut to 35 in.-lbs. (4 N.m). Whenever the tires must be replaced, replace the grommets for the tire pressure sensors as well. NOTE: If the tire pressure valve subassembly is going to be replaced, make a note of the eight-digit number (transmitter ID) before installation, as it cannot be seen after sensor is installed (see Figure 3). Whenever a new sensor is installed, it will need to be registered in the tire pressure monitor ECU. Removal 1) When replacing a wheel or tire, the tire pressure sensors must be set up in one of the following ways: • Remove the sensor from the old wheel and install it in the new wheel. Keep the same wheel with the tire pressure sensor, and replace only the tire. • Use a new wheel and sensor (the new sensor must be registered after installation). 2) Remove the wheel. Remove the cap and valve core, and release air from the tire (see Figure 4). NOTE: Keep the removed cap, valve core, nut and washer. 3) After ensuring that air is sufficiently released, remove the nut and washer that is used to hold the tire pressure sensor and drop the sensor inside the tire. NOTE: Be careful not to damage the tire pressure sensor due to interference between the sensor and tire bead. 4) After dropping the tire pressure sensor into the tire, disengage the bead using the shoe of the tire remover (see Figure 5). 5) Remove the bead on the upper side following the usual procedure. MTD March 2019

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TPMS 6) Take out the sensor from the tire, and remove the bead on the lower side following the usual procedure. NOTE: Check that no cracks or damage are visible on the grommet. If so, replace the grommet together with the washer and nut. Always replace the grommet and washer when replacing the warning valve and transmitter. 7) Remove the inner grommet from the tire pressure sensor, or retrieve it from the wheel, if necessary. NOTE: The tire pressure sensor is powered by a lithium battery. When the sensor is defective, remove the battery from the sensor and dispose of it properly. Installation 1) Insert the tire pressure monitor valve into the valve installation hole. Insert from the inside of the rim so that the print surface can be seen (see Figure 3). Check for the following: • Check that there is no visible deformation, damage or other abnormalities on the transmitter. • Check that there is no foreign matter on the inner grommet and around the rim hole. • If installed in the reverse direction, the tire pressure monitor valve may be damaged or fail to transmit signals when running at high speed. • If installing a new tire pressure monitor valve, write down the ID number before installation (see Figure 3). It is necessary to register an ID in the ECU after installation. 2) Install the washer on the tire pressure monitor valve from the rim side, and tighten the nut to 35 in.-lbs. (4 N.m). See Figure 6. Check for the following: • Ensure there is no foreign matter on the washer and nut. Always replace the grommet and washer when replacing the warning valve and transmitter. • Check that there is no oil, water or lubricant around the rim hole, tire pressure monitor valve, washer and nut. Failing to do so may result in improper installation. CAUTION: If the sensor is positioned outside the specified area, it interferes with the tire bead, causing possible damage to the sensor. 3) Put the wheel on the mounting machine, and install the lower tire bead. Position the main body of the sensor in the shaded area as shown in the illustration (see Figure 7).

TPMS columns on demand Tire Pressure Monitoring System (TPMS) columns are presented in each issue of Modern Tire Dealer, courtesy of Mitchell 1. Here is a rundown of the columns in 2019/2018, available on www.moderntiredealer. com in the digital editions found at the bottom of our home page. All of our TPMS columns are available on demand, covering well over 100 makes and models. Simply type in TPMS in the search bar. January 2019 Honda HR-V, Model years 2016-2018 Figure 7: Positioning the tire pressure sensor.

4) Making sure that the tire bead and tool do not interfere with the main body of the sensor and that the sensor is not clamped by the bead, install the upper bead and inflate the tire. 5) After the tire is inflated, the valve nut may be loose. Retighten the nut to the specified torque, and then check for air leaks with soapy water. 6) Install the tire and wheel assembly on the vehicle. 7) When a new sensor is installed, the ID code will need to be registered. See “Tire pressure sensor registration” under “Reset procedures.” 8) After completing the operation, remove the valve core to rapidly release the air in the tire. Ensure the tire pressure warning light comes on. If the warning light does not come on, refer to the appropriate manufacturer service information. Reinflate the tires. 9) If there is an air leakage, tighten the nut to a force of 35 in.-lbs. (4 N.m) and push the valve core two to three times to remove any dirt attached to the valve core. If air continues to leak, replace the grommet, washer and nut. ■ Information for this column comes from the tire pressure monitoring systems data in ProDemand®, Mitchell 1’s auto repair information software for domestic and import vehicles. Headquartered in Poway, Calif., Mitchell 1 has provided quality repair information solutions to the automotive industry since 1918. For more information, visit www.mitchell1.com. To read archived TPMS articles, visit www.moderntiredealer.com.

February 2019 Nissan Titan, 2004-2018 March 2018 Volkswagen: 2004-2006 Phaeton and 2004-2017 Touareg April 2018 Dodge Grand Caravan 2011-2017 May 2018 Kia Sedona 2006-2014 June 2018 2007-2014 Mazda3 and Mazda2 July 2018 Mercedes-Benz C-Class (204) – 2008-2015 August 2018 Chevrolet Cobalt 2008-2010, Pontiac G5 2008-2009, 2010 Pontiac G5(Canada) and Pontiac G6 2008-2010 September 2018 2011-2018 Ford Edge and Lincoln MKX October 2018 Volvo S-Series 2005-2015 November 2018 Toyota Corolla 2008-2018, and Corolla iM 2008-2017 December 2018 Fiat 500 Series 2012-2018 MTD March 2019

Nominate your choice for Modern Tire Dealer’s

2019 TIRE DEALER OF THE YEAR WE ARE NOW ACCEPTING nominations for our 27th annual Tire Dealer of the

THE MOST PRESTIGIOUS TIRE INDUSTRY AWARD!

Year award. We are looking for an exceptional tire dealer to join the ranks of other industry greats in receiving this high honor. In addition to industry recognition, the winning dealer’s favorite charity will receive a minimum contribution of $1,000 from MTD. The dealer also will be featured in the September issue of Modern Tire Dealer and online.

In selecting MTD’s 27th annual Tire Dealer of the Year, judges will consider five elements: 1 Business Success 2 Marketing Skills 3 Management Skills 4 Industry Knowledge 5 Community Involvement Any independent tire dealer, except our previous winners, is eligible for the competition. Content of nominations, not entry embellishments, will determine the winner, so keep entries factual and simple. Support material may be included, but is not mandatory.

To immediately nominate a dealer, log onto: http://www.moderntiredealer.com/tiredealeroftheyear and fill out our online nomination form by May 24, 2019.

MTD01-0337.19

For more information, contact MTD Editor Bob Ulrich at: bob.ulrich@bobit.com. Go directly to the Tire Dealer of the Year page on our website: www.moderntiredealer.com/tiredealeroftheyear

Products TBC unveils Sumitomo HTR Enhance LX2 The new Sumitomo HTR Enhance LX2 from TBC Brands comes in 43 passenger sizes for 15-inch to 22-inch wheels. The all-season touring tire replaces the LX and is available to tire dealers now. The LX2 is designed to provide enhanced ride comfort in a variety of road conditions. The LX2 has a 90,000-mile limited tread wear warranty for all T-rated sizes and 75,000-mile limited tread wear warranty for all H- and V-rated sizes. The warranty protection package also includes a 45-day free test drive, two-year 24/7 roadside assistance coverage, and free lifetime defect replacement. TBC Brands LLC www.tbcbrands.com

Dill has new digital tire inflator The new 7260 digital tire inflator from Dill Air Control Products features a 2-foot kink-resistance, stainless steel hose and a large back-lit display. The 7260 includes an auto on/off feature, and each unit is assembled and tested in the U.S. Dill Air Controls Products provides the motorsports, automotive, RV, fleet, off-road and trucking industries with valve stems and hardware, tire inflation devices, TPMS and hand tools, notes the company. DILL AIR CONTROL PRODUCTS LLC www.dillaircontrols.com

New Wagner premium brake pad for passenger cars Federal-Mogul Motorparts has added a premium brake pad for late-model passenger cars to its Wagner brand. The Wagner OEX Car line will launch with more than 100 SKUs and cover more than 90% of passenger car vehicles 2005 and newer, or more than 150,000,000 domestic and Asian vehicles in operation in North America. The premium Wagner OEX Car complements the Wagner OEX line, which is designed for SUVs, CUVs and pickups. Features of the Wagner OEX Car line include galvanized steel plates that provide corrosion resistance and fitment over paint and powder coatings. FEDERAL-MOGUL MOTORPARTS www.wagnerbrake.com

New Meyle cabin filter protects against bacteria The newest Meyle-Original cabin air filter is designed to protect against bacteria and help prevent the development of mold and fungi in addition to filtering out harmful gases, soot and pollen. Meyle AG says an additional filter layer enriched with silver ions provides the new MeyleOriginal cabin filter with an antibacterial function. The fungicidal effect of the silver ion layer also prevents the development of molds. The new cabin air filter consists of four layers that clean the air before it enters the vehicle interior. MEYLE AG www.meyle.com

Ingersoll Rand offers new torque limited impact wrench The 2-inch anvil of the new 2135QTL-2 ½-inch torque limited impact wrench from Ingersoll Rand is designed to provide better access to recessed lug nuts, making it ideal for tire shops and service centers. The tool restricts forward torque from 55 to 75 foot-pounds, reducing the chance of damaging wheels without sacrificing reverse torque. Weighing just 4.3 pounds, the 2135QTL-2 is the ultimate torque wrench counterpart, according to the company. It delivers 780 foot-pounds of max reverse torque to remove stubborn lug nuts quickly and reaches target torque in two to three seconds. INGERSOLL RAND PLC www.ingersollrandproducts.com

Atlas Automotive Equipment introduces TreadReader The new TreadReader handheld scan tool from Atlas Automotive Equipment is designed to provide an instant 3D image of a tire, providing data such as tread depth and adverse wear. The company says advisory information like misalignment or uneven wear due to under- or over-inflation is also displayed, presenting a “no-question” presentation to the user on the condition of the vehicle’s tires, and the recommended resolution. The unit requires just a few seconds to run over all four tires for instant upload to a smartphone or tablet via the TreadReader app. ATLAS AUTOMOTIVE EQUIPMENT LLC www.atlasautoequipment.com

MTD March 2019

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Ad Index WHEN YOU CONTACT ONE OF OUR ADVERTISERS PLEASE BE SURE TO MENTION YOU SAW THEIR AD IN MODERN TIRE DEALER

ADVERTISER

PAGE

WEBSITE

31 Incorporated

www.31inc.com

Aftermarket Auto Parts Alliance Inc.

38-39

www.alliance1.com

Alliance Tire Group

www.atgtire.com

AUTEL

43, 66

www.autel.com

Bartec USA

www.bartecusa.com

BendPak Inc. Ranger Products

www.bendpak.com/laser

BKT USA Inc.

www.bkt-tires.com

Blackburn OEM Wheel Solutions

www.blackburnwheels.com

DSP 20 Group

www.20dsp.com

Federal Tire

www.federaltire.com

General Tire

www.generaltire.com

Goodyear Tire

www.goodyear.com

GT Radial

www.maxtourlx.com

Hamaton LTD.

www.hamaton-tpms.com

Hankook Tire

www.laufenn.com

Hercules Tires

www.herculestires.com/avalanchert

Hunter Engineering Company

www.hunter.com

K & M Tire Inc.

www.kmtire.com

Kenda Tire USA

IBC

www.kendatraction.com

Linglong Americas Inc.

www.linglongtire.com

Maxxis Tires

www.maxxisaccelerate.com

Mighty Auto Parts

www.mightyautoparts.com

Nexen Tire America Inc.

IFC

www.nexentireusa.com

Nitto Tire U.S.A. Inc.

OBC

www.nittotire.com

Nokian Tyres Inc.

www.nokiantires.com

Sailun Tires

www.gosailun.com

Schrader TPMS Solutions

www.schradersensors.com

Sentury Tire Americas

www.landsailtires.com

Snap Finance

30-31

www.snapfinance.com

Sumitomo Tire

www.sumitomotrucktires.com

Synchrony Car Care

www.synchronybusiness.com/auto

TBC Brands

www.tbcbrands.com

Vredestein Tyres

www.vredestein.com

West Creek Financial

www.westcreekfin.com/mtd

MTD March 2019

Advertising information (330) 899-2200 ext. 2217

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Advertising information (330) 899-2200 ext. 2217

MTD Classifieds TOOLS & EQUIPMENT Tire Dealer Tools & Equipment

www.ezliftconveyors.com

Air Tools • Battery Chargers Compressors • Hose Reels Impact Sockets • Jacks Lube Equip • Tire Equip

For FREE Catalog Call 800-772-0863 www.wesbrooksinc.com

2019 ADVERTISING DEADLINES

May Issue closes April 10th

June Issue closes May 10th

2012 Sheppard Access Rd. Wichita Falls, TX 76306

July Issue closes June 11th

August Issue closes July 10th

September Issue closes August 12th

October Issue closes September 3rd

Floor to Floor tire storage made safe, fast, and reliable with this conveyor! E-ZLIFT has been serving major tire retailers for over 30 years! Length selection guide and prices: Floor to Floor Distance

Conveyor One Length Req. Start/Stop at 55˚ Incline Control

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November Issue closes September 27th

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December Issue closes November 12th

MTP, INC. Phone: 1-800-645-1123 Supplying Suppliers Since 1975 www.movittire.com Email: sales@mottire.com

BUY AND SELL BUY AND SELL USING THE INDUSTRY’S LEADING PUBLICATION USING THE INDUSTRY’S

MODERN TIRE DEALER LEADING PUBLICATION MODERN TIRE DEALER

MTD March 2019

EARN DOUBLE DOLLARS

IN MARCH AND APRIL

on the Vezda UHP A/S KR400 & Klever S/T KR52

PURCHASE NOW TO EARN MORE! That means more cash, more earnings, and more for you and your business this year!

*Double points applies to all sizes of the KR400 and KR52 tread patterns. Promotion is for dealers enrolled in the Kenda Traction program. The Kenda Traction program is free to enroll at KendaTraction.com. Through Kenda purchases earn cash back and Traction Black Card rewards. Contact your local distributor for more details.

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