THE INDUSTRY’S LEADING PUBLICATION
Industry analyst says expect higher tire prices Is this the end of used tire sales? How to use your power for the good of the customer THE INDUSTRY’S LEADING PUBLICATION
Our 51st annual
Facts Issue
2016 RECAP, 2017 PREDICTIONS January 2017 | Vol. 98, No. 1 | $30 | A Bobit Publication | www.moderntiredealer.com
Quik-Link: 800-687-1557 ext. 11101
Features 18 Tire prices will rise in 2017 Last year was weaker than expected, but analyst sees better volumes for nearly all segments of the industry
46 Tire development considerations for autonomous vehicles 48 Defining safe used tires Fear of the unknown may eliminate them from the aftermarket
The Industry’s Leading Publication January 2017, Volume 98, Number 1
Departments 4 Editorial Is our love affair with the car over? Autonomous vehicles could hurt the relationship
6 moderntiredealer.com News and navigation tools for MTD ’s website
8 News/views
54 Package deals improve margins on sales of custom wheels
Demand for large rim tires will require more capacity and boost profit per tire
24 Your marketplace
51st annual Facts Section 26 Overview: What to expect in 2017— Despite mixed signals, there is a lot to be optimistic about
28 Shipments: Consumer tire demand ebbed and flowed in 2016 30 Market share: All mixed up— Price and size will affect share
32 Distribution: Turn, turn, turn, turn your inventory 34 Commercial: Low-cost imports affected new and retreaded tires 36 Fighting for small farm tire market share 38 Pricing and sizes: Large rim diameters take over 40 Ford F-150 size and price breakdown 42 North American plant capacities 44 Auto service: Where dealers find dollars and profits
Low fuel prices, job growth, healthy miles driven and normal weather patterns spur growth
56 Counter intelligence Influence: How to use your power for the good of the customer
60 European notebook 60 years of passion, experience and success from a European tire icon
64 Business insight Batters’ up! From leadoff to clean-up, here’s how to grow your business
Focus on industry 66 Designed with the U.S. in mind: Zeta tires feature a complete dealer program 68 Kumho promises dealers a stable new year: Look for UHP, MT and CUV tires in 2018
69 TPMS 2014-2016 Chrysler/Dodge Dart: All valve stem components can be serviced and replaced individually
76 Products 78 Quik-Link 80 Classified
Modern Tire Dealer is a proud member of: TRIB
TIRE RETREAD & REPAIR INFORMATION BUREAU
Member An Industry Association
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Editorial
Is our love affair with the car over? Autonomous vehicles could hurt the relationship
L
eonardo Da Vinci may have been the first they may prefer Uber over ownership, but when person to love his car. He invented the first they eventually do buy cars, they take advantage self-propelled vehicle in 1478. Had it ever of it. That bodes well for both replacement tire advanced past the drawing board stage, however, sales and automotive repair services. it would have been driverless. The invention had Then there is the push for autonomous vehicles. neither a steering wheel nor a seat! Da Vinci Last August, Ford Motor Co. announced its intent was evidently fond of the vehicle, not driving it. to have a “high-volume, fully autonomous” vehicle With the mass production of Henry Ford’s for ride-hailing or ride-sharing services in 2021. Model T in 2008, people from almost all economic “The next decade will be defined by automaclasses suddenly were able to buy cars. And that’s By Bob Ulrich tion of the automobile, and we see autonomous when the love affair with the automobile (or light vehicles as having as significant an impact on truck, SUV or crossover utility vehicle) in the society as Ford’s moving assembly line did 100 U.S. began to develop. years ago,” said Mark Fields, Ford CEO and president. Owning a car gives most of us a sense of accomplishment If Fields is correct, that “impact” could be the end of and freedom. The love comes from driving it. America’s love affair with the automobile. Chances are Is that love fading? Is America losing interest in driving? if you don’t need to drive a vehicle, you won’t own it. If so, how will that impact the independent tire retailer? Tomorrow’s youth might even learn to live without driving. There are no black and white answers to the first two The National Highway Traffic Safety Administration questions, which we need to address before we can answer is trying to stay ahead of the technology. Its new Federal the third question. Automated Vehicles Policy “seeks to speed the delivery of an Data from the Federal Highway Administration and initial regulatory framework for highly automated vehicles,” Census Bureau indicates the percentage of teenage drivers or HAVs. Its ultimate intent is to promote automated vehicle technologies that are safe (www.nhtsa.gov/AV). In the near term, I am sure autonomous vehicles could not protect a passenger any better than a car with a good driver. There are times a driver needs to accelerate to avoid a problem, something an autonomous vehicle would not be able to do, especially if speed limits had to be followed. There are just too many vehicles on the road and too many variables for engineers to consider. Unless all vehicles on the road are autonomous, and designed to stop before hitting another vehicle, a good driver cannot be replaced. It may sound like the mass-production of autonomous vehicles is just around the corner, but it is more likely decades away. And even if they become the wave of the future, they will still need tires. They will require different design parameters to enable optimal decision-making by the artificial intelligence systems aboard autonomous vehicles, but tires will remain part of the vehicle. Miles driven would be down, and so would your sales, but the advent of autonomous vehicles would not lead to the end of the independent tire dealer. If autonomous vehicles become more viable, factors such as As for the safety aspect, I am not convinced autonomous subjective handling and steering will be less important. vehicles would ever be safer. Elon Musk, cofounder and is decreasing. Whether the cost of buying or driving a car CEO of Tesla Motors Inc., doesn’t agree. is, in their minds, too high, or they are comfortable relying “Self-driving cars are the natural extension of active on their parents to chauffeur them around, fewer teens are safety, and obviously something we should do,” he says. seeing their driver’s license as a rite of passage. Musk is obviously a fan of Leonardo Da Vinci. ■ On the bright side, the average annual miles driven by a millennial (defined by the Census Bureau as people born If you have any questions or comments, please email me between 1982 and 2000) has risen significantly. As teens at bob.ulrich@bobit.com.
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MTD January 2017
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moderntiredealer.com DIGITAL RESOURCES FOR THE INDEPENDENT TIRE DEALER
New execs, unique products News of interest to www.moderntiredealer.com readers over the past month ran the gamut from tire store acquisitions to a tire with a Crimson Tide sidewall to the 2017 Pirelli calendar. Here are your Top 10: 1. Telle Tire acquires one of its St. Louis neighbors 2. Cooper’s Hughes will speak at Deutsche Bank Auto Industry Conference 3. Michelin expands online sales program to southeast markets 4. CEO Knapp answered all our questions about Bridgestone 5. Tech International’s Tim BeVier is TRIB president 6. Kumho promises dealers a stable new year The Firestone brand is ap7. Tirecraft Canada Names New president and VP pealing to one of the nation’s 8. Hankook names new executives most ardent block of sports 9. Roll Tide with the Firestone Destination A/T tire fans, those who support the 10. New Pirelli calendar evokes emotion with stark photos Alabama Crimson Tide.
Home office 3515 Massillon Rd., Suite 350 Uniontown, OH 44685 (330) 899-2200, fax (330) 899-2209 Website: www.moderntiredealer.com
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Editorial Editor: Robert J. Ulrich, ext. 2211 Bob.Ulrich@bobit.com Managing Editor: Lori L. Mavrigian, ext. 2216 Lori.Mavrigian@bobit.com Senior Editor & Digital Projects Editor: Joy Kopcha, ext. 2215 Joy.Kopcha@bobit.com Senior Editor: Ann Neal, ext. 2218 Ann.Neal@bobit.com
re Dealer r’s Ti of ale t De
Modern Tir e
r Award Yea he
25 th
ANNIVERSARY 1993 - 2017
Who will be our silver anniversary Tire Dealer of the Year? Modern Tire Dealer will feature the 25th Tire Dealer of the Year in our September issue! See the ad on page 74 of this issue for details. Nominating someone is easy! On our www.moderntiredealer.com homepage, click on More in the menu bar, scroll down to Tire Dealer of the Year and you will be taken to our online nomination form. Fill it out, click submit and we will take it from there!
Production Art Director: Neal Weingart, ext. 2214 Neal.Weingart@bobit.com Production Manager: Karen Runion, ext. 2210 Karen.Runion@bobit.com
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MODERN TIRE DEALER (ISSN 00268496) (CDN IPM #40013413) (USPS #369-170) is published monthly by Bobit Business Media, 3520 Challenger St., Torrance, California 90503-1640. Periodicals postage paid at Torrance, CA 90503-9998 and additional mailing offices. POSTMASTER: Send address changes to MODERN TIRE DEALER, P.O. Box 1068, Skokie, IL 60076-8068. Please allow 6 to 8 weeks for address changes to take effect. Subscriptions in the U.S. and its possessions, $65; Canadian, $99; Int’l surface mail, $99; Int’l airmail, $198. Single copies, $10, except the January Facts Issue, $30. Address all subscription correspondence to MODERN TIRE DEALER, P.O. Box 1068, Skokie, IL 60076-8068. Please allow 6 to 8 weeks to receive your first issue. Please address Editorial and Advertising correspondence to MODERN TIRE DEALER, 3515 Massillon Road, Suite 350, Uniontown, OH 44685-6217. The contents of this publication may not be reproduced either in whole or in part without consent of Bobit Business Media. All statements made, although based on information believed to be reliable and accurate, cannot be guaranteed and no fault or liability can be accepted for error or omission. For your information: We sometimes make our subscriber information (i.e. fax, e-mail or mailing address) available to carefully screened organizations whose products and services may be of interest to you. If you prefer not to have your information made available, please write MODERN TIRE DEALER, P.O. Box 1068, Skokie, IL 60076-8068.
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MTD January 2017
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News/views
Demand for large rim tires will require more capacity and boost profit per tire The demand for high-value-added (HVA) tires — those 17 inches and larger — will require more production capacity to serve the U.S. market. And, HVA fitments on new vehicles are expected to increase the profitability of every light vehicle tire shipped by $4 for manufacturers that supply the U.S. market. Industry analyst and Modern Tire Dealer columnist Nick Mitchell says the need for 19.1 million units indicates “approximately four new tire plants will be needed over the next five years.” Mitchell, senior vice president of research for Northcoast Research Holdings LLC, reached his conclusions following a series of conversations with representatives from the full spectrum of the tire industry: leading manufacturers, wholesalers and retailers. Each person told Mitchell that HVA tires would continue to drive the tire market and the demand would require new tire plants. “The biggest takeaway from the discussions was the fact that each individual predicted that the HVA product cycle will continue to have a significant impact on industry fundamentals over the next five years and require meaningful investments in capacity.” There are many ways to define HVA tires, including combinations of fitment size, aspect ratio, tread compound, tread pattern, rolling resistance and speed rating. Mitchell relied on a definition adopted by Goodyear Tire & Rubber Co., Bridgestone Corp., and others: tires that are 17 inches and larger. “The increasing mix shift, combined with a modestly expanding end market, will continue to have a profound effect on the number of HVA light vehicle tires shipped across the industry in the U.S.,” Mitchell says. “In fact, we estimate that annual shipments of HVA passenger and light truck tires (defined by rim size) in the U.S. will increase by 54.2 million by the end of 2021.” The demand for tires with rim diameters of 17 inches or larger will drive the need for incremental capacity of 19.1 million tires or four new tire plants in the next five years to serve the U.S. market. “In our opinion, this means that the market fundamentals in the U.S. alone will absorb a good portion of the estimated 45 to 60 million units of light
vehicle tire production capacity that is expected to come online in North America by the end of 2021.” More profit per tire The decision of automotive original equipment manufacturers to equip more vehicles with HVA fitments is a profit windfall for tire manufacturers. “We estimate that mix trends in the U.S. alone over the next five years will drive $1.205 billion of incremental annual operating income for the manufacturers that supply the U.S. market,” says Mitchell. “This tailwind includes an estimated $1.644 billion benefit from higher shipments of 17-inch or greater tires, partially offset by a projected $438 million headwind from a decline in shipments of tires less than 17 inches. Based on our calculations, this dynamic should increase average operating income per light vehicle tire shipped by $4.”
HVA fitments on new vehicles are a profit windfall for tire makers.
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Replacement market is next Mitchell’s sources expect the demand for HVA tires will have a “significant impact” on profitability trends in the U.S. market through the end of this decade. “The next wave of the tailwind will come from an increasing penetration rate of HVA passenger and light truck tires in the replacement market,” he says. Tire manufacturers will not have to convince consumers of the merits of premium, large rim tires, according to Mitchell. “The increasing demand for HVA tires in the replacement market is more-or-less a pull-through phenomenon, resulting from the auto OEMs’ earlier decisions to turn to HVA fitments in order to achieve targeted styling and performance objectives for the new vehicles they bring to market, including Corporate Average Fuel Economy (CAFE) standards. This trend is being exacerbated by the greater adoption of tires that are 17 inches or greater, as these units typically carry the best economic characteristics among HVA tires.” The demand for premium, large rim consumer tires is just one of many factors to affect the tire industry. Mitchell offers his take on what raw material prices, government regulations and other market dynamics will mean for Modern Tire Dealer readers. His forecast for 2017 begins on page 18. — Joy Kopcha
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bites
ATD supports charities American Tire Distributors Inc. (ATD) is giving $170,000 to three charities with proceeds from its 27th annual ATD Charity Classic golf tournament. Thompson House, Friendship Trays and The Independence Fund will share the donation. CTDA elects leaders The California Tire Dealers Association (CTDA) has elected officers and directors for 2017-2018. Chris Barry from Independent Tire Dealers Group is president, Paul Arellano from Lakin Tire West is vice president, and Don Zavattero of Tech Supply Inc. is secretary/treasurer. NASTF re-elects Long Bill Long has been re-elected to the board of directors of the National Automotive Service Task Force (NASTF). Long is president and chief operating officer of the Automotive Aftermarket Suppliers Association. New president at TRIB Tim BeVier, manager of national account business development at Tech International, began a twoyear term as president of the board of directors for the Tire Retread and Repair Information Bureau (TRIB) on Jan. 1, 2017. Titan has new CEO The board of directors of Titan International Inc. has promoted its president, Paul Reitz, to CEO and president. He takes the title of CEO from Maurice Taylor, who will continue to serve as chairman. Tire for sports fans Bridgestone Americas Inc. has a limited edition Firestone Destination A/T tire for fans of the University of Alabama. The Alabama tire features the name of the school molded into the tire in raised, white lettering. Solera to acquire Autodata Solera Holdings Inc. has agreed to acquire Autodata Ltd., a provider of technical information for the automotive service, maintenance and repair industry.
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Telle Tire & Auto Service has five stores in the greater St. Louis, Mo., area following the acquisition of this Meyer’s Automotive store.
Telle Tire acquires St. Louis outlet Telle Tire & Auto Service Inc. has acquired Meyer’s Automotive in St. Louis, Mo., giving the 75-year-old tire dealership its fifth retail store in the greater St. Louis area. Terms of the deal, which closed Dec. 16, 2016, were not disclosed. Telle Tire CEO and President Aaron Telle says the company plans to retain the entire Meyer’s Automotive team. The company is working on a plan to eventually transition the Meyer’s name to Telle Tire and also create a cohesive brand plan for the storefronts and sales areas for all of its stores, he says. “Meyer’s has a very strong clientele and similar culture to Telle, which focuses on strong customer relationships and empowering its employees. Telle has identified a great opportunity to increase the tire business with Meyer’s, as their business is currently around 80% service. “Telle Tire sales have increased over 50% in 2016 and double-digit growth is anticipated for the foreseeable future.” The acquisition of Meyer’s Automotive is the company’s third acquisition in 18 months. “We are prepared and well-positioned to make two to three acquisitions per year for the next five years. Additionally, we are looking at sites for potential new builds,” says Telle. The company has a non-disclosure agreement in place for another acquisition, and Telle expects that deal to close “sometime in 2017.” Telle Tire also operates stores in Richmond Heights, Fenton and Sunset Hills, Mo., as well as across the Mississippi River in Alton, Ill. Telle, a fourth-generation tire dealer, is one of the young leaders “On the Rise” highlighted by Modern Tire Dealer in our November 2016 edition. — Joy Kopcha
Michelin expands online tire sales Michelin North America Inc. has expanded its online tire sales program. The company is selling Michelin and BFGoodrich brand tires online to consumers in Southeast markets. The brands are available for purchase from the www.michelinman.com and www.bfgoodrichtires.com websites. Michelin began selling BFGoodrich brand tires online in September 2016. The company says it is planning to sell the BFGoodrich and Michelin tire brands nationally by mid-2017. “Michelin does not own any retail stores, so our close relationship with dealers is critical for the success of this program,” says Scott Clark, chief operating officer, Michelin North America. “We have worked very closely with our retail partners to ensure we have an offer that promotes their business while also offering consumers the convenience of researching and buying online.”
MTD January 2017
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Auto Plus buys wholesaler Circle City Auto Parts in Indianapolis, Ind., has been purchased by IEH Auto Parts LLC’s Auto Plus and Pep Boys. Falken campaign honored Sumitomo Rubber North America Inc.’s Falken Tires brand won four Davey Awards for outstanding creative design for the “Grip the Moment” ad campaign from the International Academy of the Visual Arts. Hagan leads sales at Nexen Nexen Tire America Inc. has named industry veteran John Hagan executive vice president of sales. In addition, the company reports the Nexen brand has been ranked No. 10 among global tire brands by Consumer Reports magazine. Tirecraft Canada names leader Todd Richardson is the new president of Tirecraft Canada. He replaces Corey Miller as the group’s president. Parts Plus sponsors driver The Automotive Distribution Network’s Parts Plus brand will return in 2017 as the primary sponsor of Top Fuel driver Clay Millican in the National Hot Rod Association Mello Yello Series. Apollo redesigns website Apollo Tyres Ltd. has updated its website to provide consumers with a more user-friendly experience to find tires and locate dealers. Yokohama adds capacity Yokohama Rubber Co. Ltd. recently opened a new plant in the Philippines. It is operated by the company’s passenger car tire manufacturing and sales subsidiary, Yokohama Tire Philippines Inc. New Raybestos website Brake Parts Inc. has a new mobile and tablet friendly website for its Raybestos brand. Diehard brand expands Sears Holdings Corp. has extended its DieHard brand to a vehicle maintenance plan and vehicle assessment service.
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Pomp’s Tire buys Cross-Midwest Green Bay, Wis.-based Pomp’s Tire Service Inc. has expanded southward with the acquisition of Cross-Midwest Tire Co. in Kansas City, Kan. The transaction closed on Nov. 30, 2016. Financial terms were not released. Cross-Midwest will retain its name and become a division of Pomp’s Tire. There is no overlap between the two companies’ territories. Pomp’s Tire has 25 commercial outlets and 49 combination commercial/retail stores. The acquisition of Cross-Midwest adds 14 commercial outlets to Pomp’s network.
Fleet managers report the real cost of a flat tire To get a better grip of how a flat tire affects a fleet’s productivity and profitability, Fleet Financials, a sister publication of Modern Tire Dealer, conducted its first-ever flat tire survey with fleet managers. Andy Lundin, assistant editor of Fleet Financials, wrote about the survey’s results. Among the questions the magazine asked was the number of vehicles in their fleet, the approximate number of flat tires per year, the average estimated cost of driver downtime and vehicle downtime per flat, and the estimated cost of tire change per flat tire. Of the survey respondents, the average fleet size was 112 vehicles, and the approximate number of flat tires per year was 97. As for estimated costs, the average cost of driver downtime was $91.32, the estimated amount of vehicle downtime per flat was $117, and the overall cost of a tire change was $130.10. Taken together the average cost of a flat tire was about $338.42. This result was then multiplied by the Survey respondents reported an average fleet size of 112 vehicles and about 97 flat tires a year. average number of flat tires fleets face. Fleet Financials then went back to some of the survey participants to better understand the numbers. Jeb Lopez, owner of Wheelz Up LLC, an auto parts delivery service in metro District of Columbia, said his fleet consists of 100 vehicles, with 98 full-size cargo vans and two box trucks. He said his estimated cost of driver downtime was $50 and $150 for vehicle downtime. He found the estimated numbers by factoring the hourly wage of his fleet drivers, hourly cost of vehicle downtime, and the cost of fuel and other miscellaneous factors. “If the driver is 30 minutes or more away from our headquarters, our fleet response team takes a minimum of 45 minutes to get dispatched and at the location. Then it may take another 20 minutes minimum to fix the tire or if it’s major, we have to replace/swap the tire and that could total another 30 minutes.” — Joy Kopcha
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Centric Parts adds office Centric Parts has opened its Commercial Center of Excellence (CCE) in Memphis, Tenn. The CCE houses sales and support staff for the company’s Qualis division. Beck/Arnley brand acquired Federal-Mogul Motorparts, a division of Federal-Mogul Holdings Corp., has acquired the Beck/ Arnley brand. The acquisition adds Beck/Arnley fluids, engine management, cooling, electrical parts and electronic components product lines to Federal-Mogul Motorparts’ portfolio. Alliance adds member The newest member of the Aftermarket Auto Parts Alliance (Alliance) is Parts Pro Automotive Warehouse of Wickliffe, Ohio. Parts Pro joined the Alliance as a Bumper to Bumper affiliate on Dec. 1, 2016. Nucap expands sensor line Nucap Industries Inc. expanded its electronic wear sensor (EWS) line to include 2016 North American and European platforms and released a new electronic catalog. Texas dealer joins network Youngblood Automotive & Tire LLC has joined the Michelin Commercial Service Network. The thirdgeneration, family-owned centralTexas dealership has four stores. New CFO at Monro Brian D’Ambrosia is Monro Muffler Brake Inc.’s new chief financial officer. He succeeds Catherine D’Amico, who will remain as director of special projects at least through August 2018. Nokian names interim CEO Nokian Tyres plc has named Andrei Pantioukhov interim president and CEO effective Jan. 1, 2017. He will also continue to serve in his current role of general manager of Nokian’s Russian operations. Michelin earns gold The Michelin North America Inc. distribution center in Wilmington, Ill., has earned the Leadership in Energy and Environmental Design (LEED) gold certification.
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RMA: Replacement tire market outshines OE in 2016 The final 2016 forecast by the Rubber Manufacturers Association (RMA) of U.S. tire shipments shows a slight overall increase for the year. And the news is better for the replacement market than for original equipment tire orders. The estimates from the RMA cover all shipments, including RMA members as well as nonmembers. Only one segment of the market has shown improvement in both OE and replacement shipments: light truck tires. In OE LT tires are up 9.5%, and in replacement they’re up 7.9%. In both categories 2015 2016 Percent Unit the figures are final forecast change change beating the RMA’s OE tires projections for Passenger 49.7 49.6 (0.3) (0.2) the year which Light truck 4.4 4.8 9.5 0.4 were published in Truck 6.2 5.1 (17.6) (1.1) March. Replacement tires Passenger tire Passenger 206.1 205.2 (0.5) (1.0) shipments are Light truck 29.1 31.5 7.9 2.3 down slightly Truck 17.9 18.4 2.5 0.4 for both OE and replacement. OE Total shipments 313.5 314.4 0.3 0.9 All shipments are in millions, and figures are rounded by the RMA. truck tires took Numbers in parenthesis are negative. the biggest hit in 2016, with an estimated 1.1 million fewer tires shipped, down 17.6% compared to 2015. Replacement truck tires had a better year, with growth of about 0.4 million, or 2.5%. Overall, 2016 tire shipments are up less than 1 million tires, or 0.3%, to 314.4 million.
Phoenix retires without fanfare The name Bob Phoenix is known by many in the tire industry. When American Kenda Rubber Industrial Co. Ltd. hired him as vice president of sales for its Automotive Tire Division in 2009, he had already logged more than 35 years among the tire manufacturers, marketers and dealers. The majority of that time was spent in tire sales management for the North American market. When he handed over the reins to Brandon Stotsenburg earlier this month, he did so without much fanfare, which is his way. Here’s what Kenda PresiBob Phoenix retired dent Jimmy Yang had to say from Kenda after three about Phoenix: “We want to decades in tire sales management. thank Bob for his leadership in setting the foundation for Brandon Stotsenburg is the new our automotive tire business to be an outstanding vice president of part of the Kenda business in North America. Bob Kenda’s North will always be part of the Kenda family and we wish American automotive business. him happiness in his retirement.” — Bob Ulrich
MTD January 2017
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dates
February 7 Montana Tire Dealers Association Meet Your Legislators Event, Best Western Great Northern Hotel, Helena, Mont. (406) 256-1005 or (800) 388-0236 www.mtretail.com February 9-10 North Central Tire Dealers & Suppliers Association Mid-Winter Conference, Treasure Island Resort and Casino, Red Wing, Minn. (952) 544-6805 www.northcentraltiredealers.com February 15-18 Tire Industry Association Off-theRoad Tire Conference, Turtle Bay Resort, Oahu, Hawaii (301) 430-7280 or (800) 876-8372 www.tireindustry.org February 24-25 Mid-America Tire Dealers Association Convention, Kansas Star Casino, Mulvane Kan. (785) 286-1110 www.matda.org March 3-5 North Carolina Tire Dealers Association Expo/Trade Show, Raleigh City Center Marriott , Raleigh, N.C. (877) 784-0111 www.nctda.com March 23-25 Mid-America Trucking Show, Kentucky Expo Center, Louisville, Ky. (502) 899-3892 www.truckingshow.com March 31 - April 1 New England Tire & Service Association Convention, Foxwood Resort and Casino, Mashantucket, Conn. (207) 846-0986 www.netsa.org April 19-21 North American Tire & Retread Expo, Ernest N. Morial Convention Center, New Orleans, La. (786) 293-5186 www.usatireexpo.com
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Brodsky steps down as RTA leader Harvey Brodsky, founder and managing director of the Retread Tire Association (RTA), is stepping down from the organization’s top spot and handing the day-to-day management role to Jeffrey Parks. In a letter to RTA members, Brodsky said ongoing health problems forced him to retire, although he said he has “no plans to exit our industry or to leave RTA.” And of Parks, Brodsky wrote, “I have known Jeffrey Parks for more than 30 years. For the last five years, he has become RTA’s right hand man. With training, experience, knowledge, full familiarity with and passion for the retreading industry, I can say with full assurance that Jeffrey is fully ready to take over the responsibility of leading.” Parks told Modern Tire Dealer he plans to continue Brodsky’s lead and philosophy. “Harvey is a great teacher, and he’s made RTA into a solid industry organization with over 350 members worldwide. I’ll be continuing the standards and Jeffrey Parks (right) succeeds Harvey all the networking opportunities Brodsky at the RTA. that Harvey has cultivated.” Parks says he will consult with Brodsky on an ongoing basis. “With his guidance we’ll be taking RTA into the new year with the same personal attention and free exchange of unbiased information that he has built during his 40-plus years in the business. Through our extensive database, we are poised to create even better connections between our members and the worldwide industries that support the retreading, repair and recycling of tires, rubber and related businesses.”
Tire Rack renames wholesale unit Tire Rack Inc. has renamed its wholesale business. Tire Rack Wholesale became TR Wholesale Solutions on Jan. 1, 2017. The wholesale part of the South Bend, Ind.-based business began in 1988, and the company says at that time its primary focus was supplying tires to retailers. But over the years Tire Rack Wholesale has grown to include wheels, suspension and accessories, and tools. “This name more aptly describes the comprehensive solutions that we can provide and are looking forward to further developing for our wholesale customers,” says Mark Veldman, CEO and president of TR Wholesale Solutions.
Sumitomo opens R&D center Sumitomo Rubber Industries Ltd. is opening a USA Technical Center in January 2017 to help develop products more quickly for customers in North and South America. The tech center is built on the grounds of the company’s factory in Tonawanda, N.Y. By March 2017, Sumitomo will begin evaluating tires for four-wheel vehicles at its USA Tire Test Course in Huntsville, Ala., which previously has been used for motorcycle tire testing. ■
MTD January 2017
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feature
At the 2016 SEMA Show, analyst Nick Mitchell, right, and MTD analyst emeritus Saul Ludwig, left, met with Scott Jamieson, director of product management in North America for Cooper Tire & Rubber Co.
Tire prices will rise in 2017 Last year was weaker than expected, but analyst sees better volumes for nearly all segments of the industry By Joy Kopcha
A
ll the pieces were in place for a robust year for America’s tire dealers. Falling gasoline prices. More miles driven. Improving labor markets and an expanding car parc. But it never came to be. “Despite a very favorable macro backdrop, sell-out trends in the passenger and light truck replacement tire market were more tepid than most people projected at the start of the year,” said industry analyst and Modern Tire Dealer columnist Nick Mitchell. “Our best guess is demand, measured in units, at retail was flat to up 0.5% through the first 11 months of 2016.” That’s a much more somber picture than the one dealers painted at the start of 2016, when they predicted volumes would increase 2% to 3% during the year.
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It’s also an explanation for the five words Mitchell used to summarize the year: “Volumes weaker than most projected.” But there is hope, Mitchell said. “The good news is sell-out trends were stronger in the second half of 2016 than in the first half of the year, the macro backdrop remains favorable, and weather trends appear to be normalizing. As such, most dealers are telling us they expect domestic passenger and light truck replacement tire units to be flat to up 2% in 2017. This view is consistent with our expectations.” So who will benefit the most? “We anticipate the large chains and new car dealers will outperform the smaller operators in 2017.” Before we dig into the details, MTD asked Mitchell for a five-word prediction for 2017. Turns out, he only needed four words for his forecast: “Manufacturers need higher prices.”
MTD January 2017
Website: panteratire.com Quik-Link: 800-687-1557 ext. 11109
Industry analysis MTD: How would you summarize the tire industry in 2016? Where is the industry headed in 2017? Mitchell: This past year ended up being softer than most people projected, myself included. Unseasonably warm winter weather weighed on sell-out trends in the passenger and light truck replacement tire market in the first six months of the year. Additionally, the industry did not get any help from original equipment shipments to light vehicle producers, given the slowdown in new car sales. The truck tire market was plagued by weaker OE shipments and an overhang from aggressive pre-buying activity ahead of the tariffs on commercial truck tires imported from China. I think volumes across nearly every category, with the exception of shipments of passenger and light truck tires to the auto original equipment manufacturers, will be stronger in 2017 than over the past 12 months. Our base case assumes prices on light vehicle tires will move up throughout the year to cover the building pressures from higher raw material prices. Furthermore, we believe prices will go higher on truck and bus tires, largely in response to the recent tariffs on Chinese-produced products and dwindling inventories of tires purchased in the prebuying frenzy.
Mitchell: Yes; it is still early, but you are seeing early signs that Falken really wants to grow its market share in the U.S. Earlier in the year, the manufacturer announced plans to expand its plant in Tonawanda, N.Y. More recently, it unveiled a plan to develop a R&D tech center in the U.S. and upgrade its tech track to speed up innovation. These actions are clear signs that Falken has high aspirations. MTD: Which manufacturer is the one to watch in 2017? Mitchell: Here is a little bit of a curve ball: all of them. This year will be dominated by whether the manufacturers put the interest of the group over their own well-being. The industry needs to take prices higher in 2017 to offset the building pressures from rising raw material prices. If a few producers hold price firm in an effort to steal market share, it will be a tough year for all parties.
MTD: What’s the next merger you anticipate in the industry? Mitchell: I think the next merger or acquisition will likely include Kumho or Cooper. In our opinion, the latter remains an attractive target for foreign manufacturers that lack a robust footprint in North America, or an established producer that is looking to increase its market share in the all-important U.S. market.
Any success in reducing low quality tire capacity in China would be a huge win.
MTD: What should tire dealers expect when it comes to raw material prices in 2017? Mitchell: At this point, I would say most people on the manufacturing side of the industry think raw material prices will be up 5% to 10% in 2017. This seems like a safe bet given the current prices in the spot market for the key raw materials. Right now, we think the increase will be within this range. That said, views on this front can change quickly given the volatile nature of the commodity markets.
MTD: What’s the forecast for tire pricing in 2017? Mitchell: At this point, I think it is nearly unanimously accepted that the basket of raw materials will be higher in 2017, led by higher oil and natural rubber prices. The industry is working hard to keep supply in line with demand, with an eye on managing margins, so I think the manufacturers should be able to cover a large chunk, or perhaps all of the cost pressures, if they build slowly rather than quickly due to exponential moves in the prices of key raw materials. The magnitude of the price changes will be determined by the size of the move in the commodity markets.
MTD: What are your new year predictions for the Big Three: Goodyear, Bridgestone and Michelin? Mitchell: All three will work hard to exploit the trend toward high-value-added tires, especially those 17 inches or greater. All three will benefit greatly from the recent truck and bus tire tariffs. We think all three will work to drive industry pricing higher to offset the pressure from rising raw material prices. MTD: A year ago you said Falken Tire Corp. was the “manufacturer to watch” in 2016. Has it lived up to your expectations?
20
MTD: What’s happening with tire production in China? Is consolidation there really occurring? Mitchell: We continue to hear of increasing consolidation in China and that the Chinese government is trying to dramatically reduce excess capacity through environmental regulation. Recall a few years ago they tried to achieve this same goal by restricting credit from state-owned banks to these factories. Unfortunately, the data is not good enough to know for sure this is occurring, but the anecdotal commentary from people closer to the situation suggests these two latest factors are starting to have an impact on capacity in the country. Needless to say, any success with efforts to reduce the number of Tier 3 and Tier 4 producers and/or the amount of low-value added capacity in the country would be a huge win.
MTD: Who/what poses the greatest threat to the business of independent tire dealers in 2017? Mitchell: Consumers’ growing desire for a better experience. Those who do not adapt to the growing preference for clean and updated waiting rooms, fair prices, and honest advice will lose share in 2017 and beyond. MTD: What’s happening in the auto parts business? Mitchell: Volumes continue to benefit from an aging car parc, but on the margin, brands are becoming less relevant. SKU proliferation is a growing problem. MTD: How will the livelihoods of independent tire dealers be affected by the election of Donald Trump as president?
MTD January 2017
Quik-Link: 800-687-1557 ext. 11110
Industry analysis Mitchell: Honestly, it is too early to tell. That said, I believe the fate of the average independent tire dealer will be driven more by their own actions or inactions than any other factor. As such, I encourage dealers to always look for fresh opportunities to grow their business rather than relying on the state of the economy for success. The economy will grow in some years and shrink in others, but the one constant is that there is always market share up for grabs. MTD: In 2016 Kumho Tire USA Inc. opened its first American tire factory, and Hankook Tire America Corp.’s plant will open in early 2017, with others to follow in the near future. How long until these new tire manufacturing facilities affect life inside the shops owned by independent tire dealers? Mitchell: A lot of the capacity you reference is geared for the OE channel and is part of an industry shift to adopt nearsourcing strategies in an effort to limit the impact of current and future tariffs, and shorten supply chains. I think these steps will have a positive impact on working capital trends, probably more so for manufacturers and wholesalers than the independent tire dealers.
MTD: What’s the forecast for tire wholesalers? Mitchell: I think tire wholesalers will see shipments to retailers that are very consistent with consumer demand in 2017, so someplace between flat and up 2%. We expect the large wholesalers will do better than this, with the market share
22
coming at the expense of the smaller distributors. Similar to recent years, acquisitions should contribute to share gains. MTD: How’s the auto service repair business, and what’s the future of service for dealers? Mitchell: Demand on the service and repair side of the business was very similar to the trends in the tire category. OK, but not great, and much slower than the forecasts at the start of the year. I think auto service and repair work will grow in importance in the coming years. Service and repair work is a great opportunity to build trust and loyalty with consumers. Dealers who do not take a long-term view of the importance of high levels of customer service on this side of the business run the risk of damaging their brands. MTD: Are tire dealers doing something now that they won’t be doing five years from now? Mitchell: Yes. Many dealers are ignoring or underestimating the power of social media. This attitude will change greatly in the next five years. Digital media is making it easier than ever for a consumer to find a soapbox to preach from. Right or wrong, the consumer has a microphone. Installers who do not emphasize customer service and monitor social media posts to quickly rectify consumer complaints will lose market share. Those that take the opposite approach will grow above trend.
MTD: Thanks once again, Nick. ■
Quik-Link: 800-687-1557 ext. 11111
MTD January 2017
Quik-Link: 800-687-1557 ext. 11112
Your marketplace
Low fuel prices, job growth, healthy miles driven and normal weather patterns spur growth
A
ccording to the results of our survey, Replacement sales volume trends improve demand for passenger and light truck Dealers reported they sold about 0.1% more tires replacement tires was up marginally in last month relative to November 2015, following a November primarily due to a better economic flat performance in October and a healthy increase backdrop for consumers including higher emin September. Anecdotally, dealers reported ployment levels and low fuel prices. A beneficial trends strengthened as the month progressed. calendar shift also provided an extra boost. From Dealers also reported a sequential uptick in the a volume standpoint, the dealers reported they demand across the other tire categories in the sold only 0.1% more tiresin November relative period, with trends turning flat and positive in the to the previous year’s period. While the headline By Nick Mitchell commercial truck and retread categories. Medium number was far from a barn burner, we were truck replacement tire volumes were essentially encouraged to hear the respondents say that trends ac- flat in November after being down 7.3% in October, while celerated throughout the month as concerns over the retread units were up 11% after being down 4% in October. election results moderated and weather conditions turned The latest figures on retread volume suggest that the swift more favorable. Despite the slowdown in demand growth decline in Chinese import tires, due to the recent tariffs, in 2016, we continue to believe that a favorable backdrop, has caused an equally swift increase in demand for retread including low fuel prices, solid job growth, and healthy tires due to tighter supply of low-cost options. miles driven trends, combined with more normal weather patterns, should lead to improving volume growth this year. Dealer costs unchanged from the prior year’s period The tire dealers noted manufacturer pricing on branded Monthly survey and value tires were essentially the same as November 2015, A number of independent tire dealers were surveyed as raw material prices come off of their respective lows and concerning current business trends. Except for tire prices manufacturers start to adjust for higher raw material prices. and costs, the results of the November 2016 survey are Meanwhile, incentives were benign in the period due to compared with those of November 2015. the industry’s successful rebalancing of inventory levels, and a portion of the traditional fall/winter point-of-sale incentives being pulled forward to October due to sluggish trends earlier in the year.
How dealers view near-term business Dealers
JUL
AUG
SEP
Passenger tire Will improve Will worsen Will stay level
20% 0% 80%
80% 0% 20%
25% 0% 75%
50% 0% 50%
50% 0% 50%
33% 0% 67%
Truck tire Will improve Will worsen Will stay level
17% 16% 67%
75% 0% 25%
50% 0% 50%
50% 0% 50%
100% 0% 0%
50% 0% 50%
R-Revised
24
OCT(R) NOV(P) NOV(15)
P-Preliminary
Dealers believe inventory has returned to normal Fifty percent of dealers noted inventories at the end of the month were at the appropriate amount to satisfy demand (vs. 67% in October), while 50% noted inventories were too high (vs. 33% in October). For four consecutive months, none of the respondents said that inventories of passenger and light truck tires were too low. All of the commercial dealers surveyed noted they had the appropriate amount of inventory. This suggests that the channel continues to work off the product associated with all the pre-buy activity ahead of the latest anti-dumping/countervailing duties.
Dealers expect gains assuming normal winter weather
Repair sales increase in November
According to the survey results, 50% of passenger and light truck tire dealers believe business will improve over the next six months, and none are worried that trends will worsen. The rest of the respondents, 50%, felt business will stay about flat with the previous year. While dealer outlook has fluctuated slightly over the past six months, we remain encouraged by the fact that none of the respondents expect trends to decline. The outlook for commercial truck tire demand was also positive, as 100% of the dealers we spoke with see business improving in the coming months.
Dealers indicated automotive repair sales trends increased in November after mixed results over the last few months. Service sales, which accounted for a net 28% of total revenues, were up 6% on a year-over-year basis in November, which compared to a 7% increase in October and flat trends in September. ■ Nick Mitchell is senior vice president, research, for Northcoast Research Holdings LLC based in Cleveland, Ohio. Mitchell covers a variety of subsectors of the automotive industry.
MTD January 2017
Quik-Link: 800-687-1557 ext. 111113
2017 Facts: Overview
What to expect in 2017 Despite mixed signals, there is a lot to be optimistic about By Bob Ulrich
Shipley sees ride-sharing, car-sharing services and autonomous vehicles as “industry disruptors” further down the road. ven before the 2016 presidential election was over, there There also are some positive signs. Through September 2016, were signs 2017 might be a good one for the automotive vehicle miles driven was on a record pace: close to 3.2 trillion miles, industry. According to the NPD Group’s Holiday Purchase even though the 3% growth rate reportedly decreased as the year Intentions report, Donald Trump supporters were almost twice as wound down. Entering the year, AAA’s average price for a gallon of likely to say they planned to spend more on automotive products gasoline was $2.34. That’s higher than last year at this time, but still in 2016 than Hillary Clinton supporters. more than $1 a gallon less than the 2014 average, a year in which What will actually happen when Trump becomes president is total miles driven still outpaced the previous year. unknown, although he clearly favors conservative policies. But there NPD research indicates do-it-for-me oil change service has taken are other sources that will give you insight into what will affect your two share points from the do-it-yourself consumer market segment. business in 2017. Nick Mitchell, senior vice president of research for Northcoast Nathan Shipley, director of U.S. automotive industry analysis Research Holdings LLC, says the drive toward high-value-added at the NPD Group, says the combination of declining retail prices (HVA) tires — those 17 inches and larger — will require more in 2016 and a slowdown in miles driven growth are pointing to a production capacity to serve the U.S. market. “Approximately four decline in retail sales in 2017. new tire plants will be needed over the next five years.” At the Automotive Aftermarket Products Expo’s 2017 Aftermarket Now trending: CUVs, online sales and you Outlook session in November, he shared results from NPD’s 2017 The Ford F-150 was once again the best-selling vehicle in 2016. Consumer Outlook Survey with attendees. “Our forecast for 2017 is However, the fastest growing vehicle segment was the CUV segment. that our industry is going to shrink a bit. It’s going to decline 1.9%.” Vehicle registration data compiled by the R.L. Polk Division of
E
Chart 1
2016 U.S. REPLACEMENT TIRE SALES ( a $38.1 billion industry) Passenger $24.6 billion
25
20
15
10 Truck $6.3 billion Light truck $5.1 billion
5 OTR $1.6 billion Farm $ 512 million
0 26
MTD January 2017
2017 Facts: Overview IHS Inc. shows crossover utility vehicles now comprise 27% of the total automotive market in the U.S. Considering the CUV market was virtually non-existent 20 years ago, that is significant, says Mike Antich, editor of Automotive Fleet magazine. “As a consequence, OEMs are adjusting future product plans to meet this ongoing trend. Likewise, commercial fleet sales are also reflecting an increased acquisition of crossover vehicles. Today, as a percentage, fleet registrations of crossover models such as the Chevrolet Equinox, Ford Edge, Dodge Journey, etc., are beginning to mirror the market share found on the retail side of the business.” The top 10 CUV tire sizes represent 50% of the total CUV tire population, says Rick Brennan, vice president of marketing for Falken Tire Corp. The most popular is size 225/65R17, followed by 215/70R16, 235/65R17, 235/70R16, 225/60R17 and 235/55R18. There are 3.7 million more vehicles on the road with size 225/65R17 tires than there were in 2012, he adds. Another trend is the marketing emphasis on millenials, defined by the U.S. Census Bureau as people born from 1982 to 2000. Their $1 trillion in buying power and affection for both digital technology and social media have led tire manufacturers like Goodyear Tire &
Rubber Co. and Michelin North America Inc. to sell tires directly to consumers from their websites, much to the chagrin of some of their dealers. (Nick Mitchell estimates Goodyear sold 200,000 tires online last year.) Other tire manufacturers are expected to follow suit and sell online as well. “Millennials will form 75% of the workforce by 2025 and are actively shaping corporate culture and expectations,” says Goodyear. As for Bridgestone Americas Inc.’s approach to online sales , CEO Gordon Knapp says the company’s online platform is designed to drive traffic to tire dealerships. “We want you to participate in it,” he told dealers at the recent Bridgestone Consumer Tire Business Meeting. Modern Tire Dealer estimates online sales to consumers represents between 5% and 6% of the 236 million domestic replacement consumer tire market. Despite the increased competition, independent tire dealers remain the strongest of the tire distribution channels. They represent 61% of all consumer tire retail sales and 78% when wholesale distribution is taken into account. Both are increases from 2015. Retailers average $1.9 million in sales per outlet, and sell 14 to 15 different brands. Wholesalers average $5.2 million in sales, and offer 11 to 12 different brands to their retail customers.
Chart 2
BRANDS LISTED BY 50 OR MORE OF THE MODERN TIRE DEALER 100, 2006-2016 2006 Rank by No. of dealers
2014 Dealers/outlets
Rank by No. of dealers
Dealers/outlets
1. Michelin
71/3,318
1. Michelin
84/4,536
2. Goodyear
64/3,035
2. Goodyear
71/4,277
3. BFGoodrich
53/2,757
2. BFGoodrich
71/4,176
4. Bridgestone
67/4,604
2008 Rank by No. of dealers
5. Continental
62/3,616
1. Michelin
Dealers/outlets 74/3,665
6. Firestone
59/3,069
2. Goodyear
71/3,525
7. Yokohama
54/3,722
3. BFGoodrich
61/3,210
8. Cooper
51/3,308
4. Dunlop
52/2,969
8. General
51/3,176
2010 Rank by No. of dealers
2016 Dealers/outlets
Rank by No. of dealers
Dealers/outlets
1. Michelin
83/4,200
1. Michelin
89/5,059
2. Goodyear
71/3,877
2. BFGoodrich
78/4,870
3. BFGoodrich
70/3,733
3. Goodyear
73/4,716
4. Bridgestone
62/2,928
4. Continental
66/3,895
5. Continental
55/3,293
5. Bridgestone
65/4,386
6. Dunlop
52/3,301
6. Yokohama
60/2,794
2012
6. Firestone
60/2,794
Dealers/outlets
8. General
56/3,582
1. Michelin
82/4,455
9. Cooper
55/3,822
2. Goodyear
76/4,234
10. Uniroyal
52/2.623
3. BFGoodrich
71/4,065
4. Bridgestone
61/4,409
5. Continental
54/3,312
6. Firestone
54/3,003
7. Yokohama
51/3,784
Rank by No. of dealers
www.moderntiredealer.com
27
2017 Facts: Shipments Chart 3
U.S. REPLACEMENT AND OE TIRE UNITS SHIPPED, 2013-2016
15
25
150
17.3
28.8
28.8
29.0
30
Medium/Heavy truck tires 15.7
200
20
18.0
Light truck tires 31.0
192.0
206.6
205.0
205.9
250
35
18.4
(in millions; imports included)
Passenger tires
20 10
4.20
4.80
4.90
50
4.60
5.00
5.80
10
44.0
46.3
49.0
49.0
5.40
100
6.30
15
5
5
0
0
2016
2015
2014
Replacement
2013
2016
2015
2014
Replacement
OE
OE
2013
0
2016
2015 Replacement
2014
2013
OE
Consumer tire demand varied in 2016
T
ire dealer inventories were over-flowing to start 2016. Demand took care of that, but a mid-year glut again curtailed shipments a bit. When the year was over, passenger tire sales were good, but passenger tire shipments were down slightly, from 205.9 million units to 205 million. Original equipment shipments were also down, from 49.1 million to 49 million. Well stocked or not, tire dealers could sell all the LT tires they wanted: Shipments were up nearly 7%, from 29 million to 31 million units. Tariffs reduced U.S. consumer tire imports from China drastically. As a result, overall imports were down slightly, although other countries almost picked up the slack. The new tire export leader to the U.S. is Thailand, followed by South Korea, China and Canada. Chart 4
U.S. CONSUMER TIRE IMPORTS FROM CHINA (in millions of units)
Year 2016 2015 2014 2013 2012 2011 2010
Units 19.0 30.2 60.5 51.3 32.5 26.0 31.0
Yr./yr. change -37.0% -50.0% +17.9% +57.8% +25.0% -16.1% -27.9%
Year 2009 2008 2007 2006 2005 2004
Units 43.0 46.5 40.5 27.0 21.0 14.6
Yr./yr. change -7.5% +14.8% +50.0% +28.0% +44.0% +36.0%
Source: U.S. government, MTD.
Chart 6
U.S./CANADIAN LEADERS IN NEW TIRE SALES
(fiscal year 2016; in billions of U.S. dollars1) Tire company 2016 Bridgestone Americas Inc. $7.7 Goodyear Tire & Rubber Co. $6.7 Michelin North America Inc. $6.5 Continental Tire the Americas LLC $2.9 Cooper Tire & Rubber Co. $2.1 Hankook Tire America Corp. $1.6 Toyo Tire Holdings of America Inc. $1.4 Yokohama Tire Corp. $1.1 Sumitomo Rubber Industries Ltd.5 $.8 Pirelli Tire North America Inc. $.5 Kumho Tire USA Inc. $.5
28
2015 $7.9 $6.9 $6.7 $2.9 $2.2 $1.2 $1.4 $1.2 $.8 $.6 $.6
Chart 5
WORLD LEADERS IN NEW TIRE SALES
(fiscal year 2016; in billions of U.S. dollars1) Tire company 2016 2015 Bridgestone Corp. $25.8 $26.2 Groupe Michelin $21.7 $22.3 Goodyear Tire & Rubber Co. $14.8 $15.9 Continental AG $11.7 $11.6 Pirelli & Cie SpA $6.7 $7.0 Sumitomo Rubber Industries Ltd. $5.9 $6.0 Hankook Tire Co. $5.8 $5.7 Yokohama Rubber Co.2 3 $4.0 $4.1 Cheng Shin Rubber Ind. Co. Ltd.4 $3.8 $3.8 Cooper Tire & Rubber Co. $2.9 $3.0 Toyo Tire & Rubber Co. Ltd. $2.7 $2.7 Kumho Tire Co. Inc.2 $2.5 $2.7 1 The average exchange rates between foreign countries and
the U.S. dollar differed from 2015 to 2016 as follows: European euro, up 0.2%; Japanese yen, down 10.2%; Korean won, up 2.4%; Taiwan dollar, up 1.6%. 2 In 2013 Yokohama Rubber Co. and Kumho Tire Co. Ltd. signed a memorandum of understanding to share resources and “jointly pursue research and development of tire-related technologies to compete with the Big 3.� 3 Yokohama Rubber Co. Ltd. acquired Alliance Tire Group B.V. on July 1, 2016. 4 The Cheng Shin Rubber USA Inc. subsidiary does business as Maxxis International. 5 Sumitomo Corp. of America is run independently of Sumitomo Rubber Industries.
MTD January 2017
Quik-Link: 800-687-1557 ext. 11114
2017 Facts: Market share
All mixed up: Price and size will affect share
T
he demand for Tier 1 tire brands was often overshadowed by demand for lower-priced Tier 3 brands in 2016, according to Nick Mitchell, senior vice president of research for Northcoast Research Holdings LLC. Based on results from the monthly Northcoast Research Tire Demand Index, Tier 1 tires finished third behind both Tier 3 and Tier 2 tires six out of the first 10 months of the year. The ongoing trend toward larger diameter consumer tires also is affecting the mix in the aftermarket. Tire manufacturers are emphasizing these “high-value-added,� or HVA, tires in production; Mitchell predicts annual domestic shipments of HVA passenger and light truck tires will increase by 54.2 million units by the end of 2021. Chart 7
CONSUMER TIRE MARKET SHARE BREAKDOWN BY BRAND CATEGORY
Chart 10
(based on 236 million units) Chart 9
All brands listed own at least 1% of the market.
(based on 205 million units) Brand % of total Goodyear 13.0% Michelin 9.5% Bridgestone 8.0% Firestone 7.5% Cooper 5.5% BFGoodrich 5.0% Hankook 4.5% Continental 4.0% Yokohama 4.0% Falken 3.0% General 3.0% Toyo 3.0% Kumho 2.5% Multi-Mile 2.5% Nexen 2.5% Pirelli 2.5% Primewell 2.0% Sumitomo 2.0% Uniroyal 2.0% Dunlop 1.5% GT Radial 1.5% Hercules 1.5% Mastercraft 1.5% Nitto 1.5% Big O 1.0% Cordovan 1.0% Delta 1.0% Fuzion 1.0% Kelly 1.0% Sailun 1.0% Sigma 1.0% Others 3.0%
Note: Due to rounding of percentages, totals may not equal 100%.
All brands listed own at least 1% of the market.
2016 U.S. REPLACEMENT LT TIRE BRAND SHARES
Chart 8
2016 BRANDS LISTED BY THE MTD 100
(total outlets: 6,004) Rank by number of dealers Dealers/outlets 1. Michelin 89/5,059 2. BFGoodrich 78/4,870 3. Goodyear 73/4,716 4. Continental 66/3,895 5. Bridgestone 65/4,386 6. Yokohama 60/4,266 6. Firestone 60/2,794 8. General 56/3,582 9. Cooper 55/3,822 10. Uniroyal 52/2,623 11. Hankook 48/3,937 12. Dunlop 43/4,013 13. Kelly 41/2,306 14. Pirelli 40/4,235 15. Toyo 33/2,395 16. Kumho 31/2,677 17. Nexen 25/1,625 18. Falken 24/2,374 19. Nitto 22/2,200 20. Fuzion 20/922
30
2016 U.S. REPLACEMENT PASSENGER TIRE BRAND SHARES
(based on 31 million units) Brand % of total Goodyear 12.0% BFGoodrich 8.5% Bridgestone 7.5% Michelin 7.5% Firestone 7.0% Cooper 6.5% General 5.0% Hankook 4.0% Multi-Mile 4.0% Toyo 4.0% Yokohama 4.0% Kumho 2.5% Pirelli 2.5% Dunlop 2.0% Hercules 2.0% Mastercraft 2.0% Uniroyal 2.0% Continental 1.5% Cordovan 1.5% Falken 1.5% Kelly 1.5% Maxxis 1.5% Nexen 1.5% Big O 1.0% Delta 1.0% Eldorado 1.0% GT Radial 1.0% Others 5.0%
MTD January 2017
2017 Facts: Market share Chart 11
2016 OE BRAND SHARES (U.S./CANADIAN LIGHT VEHICLES, EXCLUDING IMPORTS) CHRYSLER/FIAT (FCA)
HONDA
SUBARU
Goodyear
53%
Michelin
42%
Bridgestone
67%
Michelin
15%
Goodyear
32%
Continental
30%
Firestone
7%
Bridgestone
17%
Goodyear
BFGoodrich
4%
Continental
3%
Continental
4%
Firestone
3%
Goodyear
49%
Bridgestone
3%
Hankook
2%
Michelin
49%
Kumho
3%
Yokohama
1%
Pirelli
Pirelli
3%
General
2%
Hankook
39%
Bridgestone
33%
Nexen
2%
Kumho
32%
Michelin
24%
Yokohama
2%
Nexen
15%
Goodyear
12%
Falken
1%
Continental
14%
BFGoodrich
8%
Hankook
2%
HYUNDAI/KIA
1% FORD
3% TESLA
TOYOTA
Dunlop
8%
Continental
MERCEDES-BENZ 29%
Firestone
5%
Michelin
24%
Pirelli
26%
Toyo
3%
Goodyear
21%
Dunlop
15%
Continental
2%
Continental
20%
Bridgestone
11%
General
2%
BFGoodrich
9%
Michelin
10%
Yokohama
2%
Pirelli
8%
Goodyear
General
7%
Hankook
7%
Continental
34%
Continental
53%
Bridgestone
2%
Michelin
29%
Hankook
32%
Cooper
1%
Goodyear
15%
Bridgestone
15%
Toyo
1%
BFGoodrich
6%
Toyo
6%
GENERAL MOTORS
9%
Hankook
NISSAN
Goodyear
40%
Bridgestone
3%
Michelin
20%
General
2%
Bridgestone
17%
Hankook
2%
Firestone
13%
Dunlop
1%
Continental
6%
Falken
1%
Hankook
3%
Kumho
1%
General
1%
Chart 12
U.S./CANADIAN OE CONSUMER TIRE MARKET SHARE (excluding imported vehicles)
Chart 13
BMW Pirelli
30%
Bridgestone
24%
1% VOLKSWAGEN
U.S./CANADIAN LIGHT VEHICLE MARKET SHARE
(based on production)
Goodyear
27.1%
Michelin
21.5%
Bridgestone
13.3%
Continental
11.4%
Hankook
4.9%
Firestone
4.7%
Continental
22%
Dunlop
20%
OEM
2016
2015
BFGoodrich
3.7%
Michelin
4%
GM
21.0%
19.0%
Pirelli
3.6% 2.4%
www.moderntiredealer.com
Ford
18.6%
18.6%
General
FCA
14.5%
17.0%
Kumho
2.3%
Toyota
13.6%
13.6%
Dunlop
2.0%
Toyo
1.2%
Honda
11.7%
11.7%
Nissan
6.9%
6.6%
Nexen
1.0%
Others
13.7%
13.5%
Others
0.9%
31
2017 Facts: Distribution Chart 15
Chart 14
COMPANY-OWNED STORES IN THE U.S.
CONSUMER TIRE DISTRIBUTION CHANNEL MARKET SHARE Initial channel
2016
2014
2012
2010
Independent tire dealers
78.0%
77.0%
77.0%
75.0%
7.5%
8.0%
8.0%
8.5%
14.5%
15.0%
15.0%
16.0%
Tire company stores Miscellaneous*
* Miscellaneous includes mass merchandisers, warehouse clubs, automobile dealerships, auto parts chains, muffler shops and oil companies/service stations.
Actual store numbers Bridgestone 2,200 Goodyear 600 Nokian/Vianor 76
Turn, turn, turn, turn your inventory
H
ow often should tire dealers turn their inventories? No less than four times a year, says Dennis McCarron, executive director of Dealer Strategic Planning Inc. Scheduled deliveries could increase that to eight times a year. “Inventory should turn frequently enough so that cash is always available.”
Chart 16
U.S. CONSUMER TIRE RETAIL MARKET SHARE (based on retail sales)
Distribution channel
2016
2014
2012
Independent tire dealers
61.0%
60.5%
60.5%
Mass merchandisers
12.0%
13.0%
14.0%
Warehouse clubs
9.0%
9.0%
8.5%
Auto dealerships
8.5%
8.0%
7.0%
Tire company-owned stores
7.0%
7.5%
7.5%
Miscellaneous outlets
2.5%
2.0%
2.5%
Chart 17
MARKET SHARE: AUTO DEALERSHIPS VS. MASS MARCHANDISERS (based on retail sales)
Mass merchandisers 20
Chart 18
Auto dealers
U.S. NEW-CAR FRANCHISES Year
Number
2016
16,680
2015
16,545
2014
16,396
2012
17,545
2011
17,700
2010
18,460
2009
20,010
2008
20,770
2007
21,200
2006
21,495
2005
21,640
Source: National Automobile Dealers Association
32
20
15
15
10
10
5
5
0
2000 2002 2004 2006 2008 2010 2012 2014 2016
0
MTD January 2017
Quik-Link: 800-687-1557 ext. 11115
2017 Facts: Commercial Chart 19
U.S. RETREADING, 2016
Chart 20
2016 U.S. MARKET SHARE, RETREADED TRUCK TIRES
Truck tire units
14.5 million
Sales (with casings)
$3.2 billion $63.84
Bridgestone (Bandag)
43.5%
Average casing price % precure units
94%
Goodyear
23.0%
Average sales margin
21.6%
Michelin/Oliver
23.0%
(based on 14.5 million units)
No. of plants, truck tires
650
Marangoni
5.0%
No. of plants, OTR tires
18
Continental
2.0%
Others
3.5%
Note: Due to rounding of percentages, totals for some charts may not equal 100%.
Low-cost imports affected new and retreaded tires
I
n 2016, replacement truck tire shipments were up 2.2%, to 18.4 million units. Some of those were low-cost imports, which adversely affected the number of retreaded truck tires sold. As the year was ending, however, preliminary tariffs imposed by the U.S. Department of Commerce were helping retreaders. According to “Profile of the U.S. Commercial Vehicle Market” by MacKay & Co. and Heavy Duty Trucking magazine, the Class 8 vehicle universe increased 5.8% from 2011 through a near-record 2015, which helps explain the increase in replacement truck tire shipments. Class 8 vehicle registrations were down in 2016, however, which is why OE truck tire shipments were down 14.2%. The average sales margin for independent truck and wholesale truck tire dealers was 15% and 9.5%, respectively. The margin on commercial light truck tires was 19.1%.
60%
Chart 23
COMMERCIAL TIRE DISTRIBUTION CHANNEL MARKET SHARE (new and retreaded truck tires)
50%
Local tire outlet 52%
Tire mfr. through dealer 28%
40% Tire mfr. direct 12%
Chart 21
2017 U.S. REPLACEMENT MEDIUM/ HEAVY TRUCK TIRE BRAND SHARES
(based on 18.4 million units) Brand
2017
Bridgestone
16.0%
Michelin
16.0%
Goodyear
11.5%
Yokohama
8.5%
Firestone
7.0%
Continental
6.0%
Hankook
3.5%
Double Coin
3.5%
Hercules
3.0%
Roadmaster
2.5%
Sailun
2.5%
Aeolus
2.0%
General
2.0%
Toyo
2.0%
Dynatrac
2.0%
BFGoodrich
1.5%
Dayton
1.5%
Duraturn
1.0%
Dynacargo
1.0%
Sumitomo
1.0%
Gladiator
1.0%
Kelly
1.0%
Kumho
1.0%
Samson
1.0%
Westlake
1.0%
Others
4.0%
All brands listed own at least 1% of the market.
Chart 22
U.S. TRUCK TIRE IMPORTS FROM CHINA (in millions of units)
30%
Other 1%
'Truck stop 1%
20%
Emergency road service 1%
'Local retread shop 5%
10%
0%
34
Source: Mackay & Co., www.mackayco.com
Year
Units
Yr./yr. change
2016
7.8
-17.0%
2015
9.4
+14.6%
2014
8.2
+30.1%
2013
6.3
+0.1%
2012
6.3
+13.5%
2011
5.5
+37.5%
Source: U.S. government, MTD figures.
MTD January 2017
Quik-Link: 800-687-1557 ext. 11116
2017 Facts: Commercial Chart 24
REAR FARM TIRE RADIALIZATION TRENDS
Chart 25
Replacement
RADIAL REAR, REPLACEMENT 2016 shipments: 289,100
OE
60% 50% 40% 30% 20%
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
Source: Modern Tire Dealer
Chart 26
Fighting for small farm tire market share
L
ook for added competitiveness in the replacement front and implement farm tire market in the future. “I think that’s a developing market, especially on the radial side,” says Steve Campanella, business intelligence manager for Alliance Tire Americas Inc. “It’s an opportunistic area.” Bill Haney, off-highway tire manager for Apollo Vredestein Tyres North America Inc., agrees with the radialization trend in the replacement small farm tire segment. “The market made a jump from U.S. standard bias tires to improved premium bias and implement flotation bias tires, and is now making the next jump to radials in these segments with good results.”
36
2016 U.S. REPLACEMENT FARM TIRE MARKET SHARES Firestone
31.0%
BKT
23.0%
Michelin
17.5%
Goodyear
12.5%
Alliance*
7.0%
Titan
4.0%
Trelleborg
2.0%
Mitas
1.5%
Others
1.5%
Total
2016 U.S. OE FARM TIRE MARKET SHARES
RADIAL REAR, OE 2016 shipments: 168,000 Firestone 40.0% Goodyear 32.0% Michelin 14.0% Titan 5.0% BKT 3.0% Mitas 2.0% Trelleborg 2.0% Others 2.0% Total 100.0% BIAS REAR, OE 2016 shipments: 277,000 Titan 35.0% Firestone 30.0% Goodyear 25.0% Alliance* 6.0% BKT 1.0% Trelleborg 1.0% Others 2.0% Total 100.0% SMALL FARM, OE 2016 shipments: 263,000 Goodyear 32.5% Titan 20.5% Firestone 15.0% Carlisle 12.0% BKT 7.0% Alliance* 6.5% American Farmer 2.0% Trelleborg 1.5% Mitas 1.0% Others 2.0% Total 100.0%
100.0% BIAS REAR, REPLACEMENT 2016 shipments: 464,000
BKT
38.0%
Firestone
24.0%
Alliance*
11.0%
Goodyear
7.0%
Harvest King
5.0%
Titan
4.5%
Trelleborg
2.5%
Akuret
2.0%
Carlisle
2.0%
American Farmer
1.0%
Others
3.0%
Total:
100.0%
SMALL FARM, REPLACEMENT 2016 shipments: 1.22 million Firestone
22.0%
BKT
17.0%
Goodyear
15.0%
Titan
13.0%
Carlisle
12.0%
Harvest King
8.0%
Akuret
4.0%
Alliance*
3.0%
Trelleborg
2.5%
American Farmer
1.0%
Others
2.5%
Total
100.0%
Source: Modern Tire Dealer * Yokohama Rubber Co. Ltd. purchased Alliance Tire Group B.V on July 1, 2016.
MTD January 2017
Quik-Link: 800-687-1557 ext. 11117
2017 Facts: Pricing and sizes Chart 29
TOP U.S. REPLACEMENT PASSENGER TIRE SIZES, 2016
Chart 27
1. 205/55R16 3. 195/65R15 5. 265/70R17 7. 225/60R16 9. 195/60R15
NEW P-METRIC AND LT TIRE SIZES/SKUS IN 2017 (not counting spares or 17 additional load ranges added to existing LT sizes)
P255/80R17
P275/45R18
P325/35R18
LT355/40R26 LRF
35x11.50R17LT LRE
33x11.50R20LT LRE
37x13.50R26LT LRE
36x15.50R20LT LRE
40x15.50R26LT LRE
2. 215/60R16 4. 215/55R17 6. 225/65R17 8. 225/50R17 10. 235/70R16
Source: RMA, MTD
Source: Tire & Rim Association
Chart 30
TOP U.S. REPLACEMENT LT TIRE SIZES, 2016
Chart 28
AVAILABLE SIZES BY RIM DIAMETER 12-inch: 1
17-inch: 59
22-inch: 7
13-inch: 13
18-inch: 67
23-inch: 2
14-inch: 26
19-inch: 25
24-inch: 6
15-inch: 56
20-inch: 29
16-inch 57
1. LT265/70R17 3. LT265/75R16 5. LT235/85R16 7. LT285/70R17 9. LT285/75R16
26-inch: 1 Source: Tire & Rim Association
21-inch: 2
2. LT245/75R16 4. LT225/75R16 6. LT275/70R18 8. LT245/75R17 10. LT215/85R16
Source: RMA, MTD
Chart 31
ADVERTISED OIL CHANGE PRICES 25
Large rim diameters take over
Prices in dollars
15
L
arge rim diameters are the new normal for passenger tire sizes. Defined as 17-inch sizes and above, they represent 56.4% of all 351 sizes. They also are known as high-value-added tires, or HVA for short. Wal-Mart Stores Inc. still advertises smaller sizes. For example, Walmart has been offering the Goodyear Eagle RS-A in size 195/60R15, still the ninth most popular size, for at least five years. In that time, the price has steadily dropped from $65 in 2011 to $54 in 2016. Its $37.50 Douglas Xtra-Trac II in size 155/80R13 is no longer available, but the size has not disappeared. It is now known as the Douglas All-Season ($40.91) on walmart.com. Eight other lines also are available in size 155/80R13, ranging from the Evergreen EH22 ($28.70) to the Cooper Trendsetter SE ($70.95).
10 2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
Source: Modern Tire Dealer statistics
Chart 32
2016 AVERAGE ADVERTISED TIRE PRICES (in the U.S.)
Major brand
Low-cost
Overall
205/55R16
$137.23
$77.14
$123.98
215/55R17
$153.27
$88.39
$136.87
215/60R16
$126.89
$78.15
$112.15
235/75R15
$137.27
$100.10
$123.20
ADVERTISED PRICING BREAKDOWN, 215/55R17
275/65R18
$230.62
$211.30
$221.06
LT225/75R16
$172.60
$123.74
$155.88
Speed
Major
Chart 33
38
$19.54
20
Size
Low Cost Radial
Overall
LT245/75R16
$180.39
$127.30
$162.92
V-rated
$157.60
$90.59
$140.87
LT245/75R17
$213.73
$150.61
$195.81
H-rated
$151.75
$100.43
$146.44
31x10.50R15
$182.17
$139.29
$167.01
T-rated
$139.78
$106.86
$132.24
Source for Charts 32-34: Intelligence LLC, www.tire-intelligence.com
MTD January 2017
Quik-Link: 800-687-1557 ext. 11118
2017 Facts: Pricing and sizes
Chart 34
PRICE POINT BREAKDOWN OF SIZE 265/70R17 BY REGION Region
OPP
Value
Better
Best
Winter
Average
East North Central $111.81
$141.96
$168.60
$177.55
$145.21
$164.84
East South Central
$114.85
$126.80
$160.83
$178.30
$146.18
$159.37
Middle Atlantic
$122.00
$137.03
$174.31
$185.61
$144.14
$170.72
Mountain
$110.24
$142.29
$151.72
$168.60
$157.11
$153.76
New England
$134.04
$157.54
$180.74
$194.82
$134.39
$179.33
Pacific
$105.11
$164.89
$158.81
$175.75
$175.40
$164.73
South Atlantic
$118.40
$134.98
$170.31
$180.28
$146.89
$166.20
West North Central
$114.34
$107.94
$148.12
$163.11
$147.53
$146.51
West South Central
$108.20
$134.17
$163.44
$176.09
$160.64
$161.19
Nationwide
$115.36
$136.00
$167.37
$178.87
$150.35
$164.45
Source for Charts 34 and 36: The Fitment Group, www.fitmentgroup.com
Chart 35
MOST POPULAR DOMESTIC OE PASSENGER AND LT TIRE SIZES 2015 OE P-metric/metric
2012 OE P-metric/metric
Size
Size
% of total
2013 OE light truck (LT) Size
4.1%
P215/55R17
6.1%
LT245/75R17
21.9%
P265/70R17
3.4%
P265/70R17
4.4%
LT245/75R16
14.0%
P215/60R16
3.2%
P215/60R16
3.8%
LT225/75R16
11.3%
225/65R17
2.8%
P275/65R18
3.4%
LT265/70R17
8.9%
215/55R17
2.8%
P205/65R16
3.1%
LT265/75R18
8.1%
Size
% of total
2015 OE light truck (LT) Size
% of total
2012 OE light truck (LT) Size
T
he Ford F-150 pickup has been the most popular vehicle in the U.S. for 35 consecutive years. That is why you can expect to see a lot of 2012 and 2013 models — maybe even heavily used 2014 models — in your dealership in 2017. There are seven mass market original equipment sizes on all Ford F-150 models from 2012-2014. That includes the Super Cab and the Super Crew. Here are the estimated shipments in those sizes for 2017, courtesy of The Fitment Group (see Chart 36). In the spirit of inventory management, we also broke down the most popular size, 265/70R17, into five price points in nine regions (see Chart 34). Not surprisingly, two of the sizes, 265/70R17 and 275/65R18, were among the seven most popular OE sizes in all three model years. And they are also OE options on the 2015-2016 models.
% of total
P215/55R17
2014 OE P-metric/metric
% of total
Chart 36
PROJECTED DEMAND FOR THE TOP 7 MASS MARKET FORD F-150 SIZES ON 2012-2014 MODELS (includes 2WD and 4WD)
Top sizes
Estimated unit sales, 2017
P215/55R17
5.0%
LT245/75R17
18.6%
LT245/75R17
22.1%
235/75R17
P215/60R16
3.4%
LT225/75R16
9.8%
LT245/75R16
14.7%
245/75R17
70,530
215/55R17
2.7%
LT265/70R18
9.7%
LT225/75R16
11.1%
265/70R17
6,615,436
P265/70R17
2.7%
LT275/70R18
7.9%
LT265/70R18
8.1%
255/65R17
659,592
P275/65R18
2.6%
LT245/75R16
7.6%
LT265/70R17
7.7%
275/65R18
1,071,650
265/60R18
1,176,025
275/55R20
2,502,360
2013 OE P-metric/metric Size
40
% of total
Ford F-150 size and price breakdown
% of total
2014 OE light truck (LT) Size
% of total
P215/55R17
6.1%
LT245/75R17
21.7%
P265/70R17
4.0%
LT245/75R16
12.0%
P275/55R20
3.2%
LT225/75R16
11.4%
P275/65R18
3.1%
LT265/70R18
10.3%
P215/60R16
3.1%
LT275/65R18
7.8%
LT245/75R17 has been the No. 1 OE size from 20112015. The second most popular size, LT245/75R16, was No. 1 from 1993-2010. Source: Rubber Manufacturers Association
260,312
Combined, these seven sizes, which also can be found on other vehicles, total 12.3 million tires, or close to 5% of the projected replacement consumer tire shipments in 2017.
MTD January 2017
Quik-Link: 800-687-1557 ext. 11119
2017 Facts: Plant capacities
Wow, a 4.6% rise in capacity!
Y
early tire capacity, not production, in North America totaled 324.5 million tires in 2016, a whopping 4.6% increase over 2015. And there is more to come; at least 22.3 million more tires will be available by 2023. The majority of the increases were the result of new plants and facility upgrades in the U.S. and Mexico. U.S. capacity rose nearly 5%. None of the four new plants are unionized. Since 2000, 10 consumer tire plants in the U.S. have been closed. Eight of them were union facilities: • Goodyear: Union City, Tenn. (2011), Tyler, Texas (2008), and Huntsville, Ala. (2003). • Continental: Charlotte, N.C. (2006), and Mayfield, Ky. (2005). • Michelin: Opelika, Ala. (2009), and Reno, Nev. (2002). • Bridgestone: Oklahoma City, Okla. (2006). • Cooper: Albany, Ga. (2009). • Pirelli: Hanford, Calif. (2001). The plants produced an estimated 263,000 passenger and light truck tires a day.
42
Chart 37 NORTH AMERICAN PLANT CAPACITIES as of Jan. 1, 2017 (in thousands of units) PasLight senger truck Truck Others Plant location/ Nonper per per per Year constructed union ISO QS day: day: day: day: Bridgestone Americas Inc. Aiken, S.C., 2013 x 0.0 0.0 0.0 0.03 La Vergne, Tenn., 1972 x x 0.0 0.0 6.2 0.0 Warren County, Tenn., 1990 x x 0.0 0.0 9.0 0.0 Bloomington, Ill., 1965 x x 0.0 0.0 0.0 0.29 Des Moines, Iowa, 1945 x x 0.0 0.0 0.0 4.57 Wilson City, N.C., 1974 x x x 32.0 0.0 0.0 0.0 Aiken, S.C., 1999 x x x 25.5 10.2 0.0 0.0 Joliette, Quebec, 1966 x x 9.3 7.2 0.0 0.0 Monterrey, Mexico, 2007 x 8.0 0.0 0.0 0.0 Cuernavaca, Mexico, 1980 x x 11.0 4.4 0.0 0.0 Total: 85.8 21.8 15.2 4.89 American Industrial Partners (formerly Carlisle Tire & Wheel Co.) Jackson, Tenn., 2009 x 0.0 0.0 0.0 26.0 Clinton, Tenn. (Dico), 1974 x x 0.0 0.0 0.0 15.0 Total: 0.0 0.0 0.0 41.0 Continental Tire the Americas LLC Sumter, S.C., 2013 x 7.4 2.1 0.0 0.0 Mount Vernon, Ill., 1973 x x x 29.0 4.0 8.0 0.0 Total: 36.4 6.1 8.0 0.0 Cooper Tire & Rubber Co. Findlay, Ohio, 1917 x 7.0 16.0 0.0 0.0 Texarkana, Ark., 1964 x 24.0 8.0 0.0 0.0 Tupelo, Miss., 1984/1960 x x 42.0 0.0 0.0 0.0 Total: 73.0 24.0 0.0 0.0 Goodyear Tire & Rubber Co. Danville, Va., 1966 x x 0.0 0.0 11.0 2.0 Fayetteville, N.C., 1969 x x 30.5 10.5 0.0 0.0 Gadsden, Ala., 1928 x x 14.5 11.5 0.0 0.0 Lawton, Okla., 1978 x x x 64.0 0.0 0.0 0.0 Topeka, Kan., 1945 x x 0.0 0.5 5.5 0.1 Medicine Hat, Alberta, 1960 x x 0.0 0.0 0.0 13.0 Napanee, Ontario, 1990 x x x 19.0 0.0 0.0 0.0 Total: 128.0 22.5 16.5 15.1 GTY (General/Yokohama) Mount Vernon, Ill., 1988 x x x 0.0 0.0 3.9 0.0 Hankook Tire America Corp. Clarksville, Tenn., 2016 x 10.0 5.0 0.0 0.0 Kumho Tire Co. Inc. Macon, Ga., 2015 x 8.0 3.0 0.0 0.0 Michelin North America Inc. Ardmore, Okla., 1969 x x x 40.5 3.5 0.0 0.0 Dothan, Ala., 1979 x x 1.2 4.3 0.0 0.0 Fort Wayne, Ind., 1961 21.0 9.5 0.0 0.0 Greenville, S.C., 1975 x x 28.0 0.0 0.0 0.0 Greenville, S.C. (C3M), 1997 x x x 7.0 0.0 0.0 0.0 Greenville, S.C. (Tweel), 2014 x 0.0 0.0 0.0 0.07 Lexington, S.C., 1981 x x 19.0 5.0 0.0 0.0 Lexington, S.C., 1998 x x 0.0 0.0 0.0 0.1
Total 0.03 6.2 9.0 0.29 4.57 32.0 35.7 16.5 8.0 15.4 127.69 26.0 15.0 41.0 9.5 41.0 50.5 23.0 32.0 42.0 97.0 13.0 41.0 26.0 64.0 6.1 13.0 19.0 182.1 3.9 15.0 11.0 44.0 5.5 30.5 28.0 7.0 0.07 24.0 0.1
MTD January 2017
2017 Facts: Plant capacities Passenger per day: 0.0 0.0 23.0
Light truck per day: 0.0 0.0 7.0
Truck per day: 7.0 0.0 0.0
Others per day: 0.0 0.01 0.0
Plant location/ NonYear constructed union ISO QS Spartanburg, S.C., 1978 x x Starr, S.C., 2013 x Tuscaloosa, Ala., 1945 x Bridgewater, Nova Scotia, Canada, 1973 x x 11.0 3.0 0.0 0.0 Granton, Nova Scotia, 1971 x x 2.0 0.0 0.0 0.0 Waterville, Nova Scotia, 1982 x x 0.0 0.0 4.5 0.5 Queretaro, Mexico x 6.0 0.0 0.0 0.0 Total: 158.7 32.3 11.5 0.68 Pirelli Tire North America Inc. Rome, Ga., (MIRS), 2002 x x 1.2 0.5 0.0 0.0 Guanajuato, Mexico, 2011 x 8.0 3.0 0.0 0.0 Total: 9.2 3.5 0.0 0.0 Specialty Tires of America Inc. Indiana, Pa., 1915 x 0.92 0.18 0.05 2.35 Unicoi, Tenn., 1997 x 0.3 0.5 0.05 .25 Total: 1.22 0.68 0.1 2.6 Sumitomo Rubber USA LLC (Sumitomo Rubber North America Inc.) Tonawanda, N.Y., 1923 x 3.0 2.0 2.3 5.0 Titan Tire Corp. Bryan, Ohio, 1967 x x 0.0 0.0 0.0 0.33 Des Moines, Iowa, 1943 x 0.0 0.0 0.0 11.25 Freeport, Ill., 1964 x x 0.0 0.0 0.0 8.1 Total: 0.0 0.0 0.0 19.68 Toyo Tire North America Manufacturing Inc. White, Ga., 2005 x x 8.8 8.8 0.0 0.0 Trelleborg Wheel Systems Spartanburg, S.C., 2015 x 0.0 0.0 0.0 0.06 Charles City, Iowa, 2012 0.0 0.0 0.0 0.5 Total: 0.0 0.0 0.0 0.56 Yokohama Tire Corp. West Point, Miss., 2015 x x x 0.0 0.0 2.0 0.0 Salem, Va., 1968 25.7 1.1 0.0 0.0 Total: 25.7 1.1 2.0 0.0 Grupo Carso/Euzkadi (Continental AG) San Luis Potosi, Mexico 15.0 5.0 0.0 0.0 JK Tyre & Industries (formerly CIA Hulera Tornel) Mexico City, Mexico 0.0 1.0 1.0 0.14 Tultitlan, Mexico 7.0 1.5 0.5 0.0 Tacuba, Mexico 8.0 2.5 0.0 0.0 Total: 15.0 5.0 1.5 0.14 Corporacion de Occidente SA de CV (Cooper Tire) Guadalajara, Mexico, 2005 x x x 10.0 7.2 2.8 0.0 U.S. totals: Canadian totals: Mexican totals: TOTAL:
www.moderntiredealer.com
473.52 41.3 73.0 587.82
113.18 10.2 24.6 147.98
55.0 4.5 4.3 63.8
76.01 13.5 0.14 89.65
Chart 38
Total 7.0 0.01 30.0 14.0 2.0 5.0 6.0 203.18 1.7 11.0 12.7 3.5 1.1 4.6 12.3
PLANT UNIONIZATION BREAKDOWN
25 Union
35 Non-union
Chart 39
ADDITIONAL CONSUMER TIRE CAPACITY TARGET DATES Goodyear Tire & Rubber Co. New plant: San Luis Potosi, Mexico Cost: $550 million Completion date: Not specified Annual capacity: 6 million
0.33 11.25 8.1 19.68
Giti Tire (USA) Ltd. New plant: Chester County, S.C. Cost: $560 million Completion date: Not specified Annual capacity: 5 million
17.6
Michelin North America New plant: Leon, Mexico Cost: $510 million Completion date: 4Q 2018 Annual capacity: 4-5 million
0.06 0.5 0.56 2.0 26.8 28.8 20.0 2.14 9.0 10.5 21.64
20.0 717.71 69.5 102.04 889.25
Pirelli Tire North America New plant: Silao, Mexico Cost: $200 million Completion date: By 2019 Annual capacity: 2.5 million Sumitomo Rubber USA Plant: Tonawanda, N.Y. Cost: $87 million Completion date: By 2020 Annual addl. capacity: 1.8 million Bridgestone Americas Plant: Wilson, N.C. Cost: $344 million Completion date: By 2018 Annual addl. capacity: 1 million Plant: Joliette, Quebec Cost: $250 million Completion date: By 2023 Annual addl. capacity: 1 million Added capacity: up to 22.3 million
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2017 Facts: Auto service Chart 41
SERVICE WORK AVERAGE ANNUAL SALES AND PROFIT PER SERVICE PER DEALER
Service
Average annual sales $10,037
Electronic diagnosis
$21,196
Ignition and spark
$22,073
Exhaust systems
$28,320
Cooling system
$28,920
TPMS
$29,287
Chemicals
$30,210
Bearings/seals
$47,669
Batteries/electrical
$50,246
Oil and lubrication
$60,651
Engine repair
$61,426
Shocks/struts
$62,379
Alignment
$69,509
Air conditioning
$83,744
Chassis/suspension
$126,459
Brakes
$151,768
Mount/balance
$170,280
Source: MTD research
Annual profit 150K
Annual sales
100K
50K
0
ce lan /ba unt Mo system sion en ke Bra s/susp g ssi nin Cha ditio con Air ent nm ts Alig s/stru ck ir Sho repa ine Eng ation m ric e Lub c syst als ctri Ele gs/se rin Bea icals m Che S em TPM g syst lin em Coo st syst au em Exh n syst itio Ign sis gno Dia s er Wip
Visibility (wipers)
175K
Dollars
Chart 40
SERVICE WORK: AVERAGE ANNUAL SALES PER SERVICE PER DEALER
Where dealers find dollars and profits he latest MTD research shows automotive service sales, on average, generate 45% of total sales and 44% of total earnings for independent tire dealers. The most revenue comes from mounting and balancing, brake systems service and chassis and suspension work, which bring in $4.8 billion, $4.2 billion and $3.3 billion, respectively, of all independent tire dealer sales. Margins of 68% make alignments the most profitable service category, followed by the engine repair/diagnostics and ignition and spark plug categories, both with margins of 63%. Dealers report margins of 62% for mounting and balancing services.
T
Chart 42
SERVICE WORK: AVERAGE ANNUAL PROFIT PER SERVICE PER DEALER Service Visibility (wipers) TPMS Electronic diagnosis Cooling system Ignition and spark Chemicals Exhaust systems Batteries/electrical Oil and lubrication Bearings/seals Shocks/struts Engine repair Alignment Air conditioning Chassis/suspension Brakes Mount/ balance
Average annual profit $4,015 $12,008 $12,718 $13,882 $13,906 $14,803 $15,010 $17,586 $21,228 $22,881 $28,071 $38,698 $47,266 $47,734 $64,494 $80,437 $105,574
Source: MTD research
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MTD January 2017
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feature
Tire development considerations for autonomous vehicles By Dean Tener
A
utonomous vehicle technology is on its way. In 2004, importance. The feel of a tire on the road, or “haptic feedback,” the best performing autonomous car was only able to is currently determined through vibrations in a steering wheel, travel 7.5 miles. Now, we are seeing incredible technology but the lack of a steering wheel means this feedback must be take the same roads as human-driven automobiles. monitored and acted upon differently. Ride will still be important, The definition of what constitutes an “autonomous vehicle” as passengers will be able to feel the impact of the road on tires, can vary. The Society of Automotive Engineers (SAE) defines but aerodynamics, durability and rolling resistance will be more six levels of driving automation from “no automation” to “full heavily emphasized than before. automation” (see chart). Based on these varying levels, there Decision-making in vehicles often depends on tires. For example, are already vehicles with systems that provide differing levels of grip on the road can determine whether a driver chooses to stop autonomy, including emergency braking, lane departure warn- or swerve to avoid an oncoming obstacle. These decisions cannot ings, adaptive cruise control, etc., available in the marketplace. be made without a proper feel for a vehicle’s tires. This is why a The next 10 to 20 years will be shaped by progressive improve- tire limit estimation must be determined in testing, especially ments to the technology and introductions of new features. The for autonomous vehicles. This data allows the controller in speed at which each of these features is adapted depends on many different factors such as cost, regulation, infrastructure changes, insurance and legal rulings on responsibility, etc. For example, the first rear This chart summarizes the camera was introduced in 2001. It was mandated on levels of automation for new vehicles in the United States in 2016 — 15 years on-road vehicles, per SAE from market introduction to regulated requirement. Standard J3016. Source: While technology continues to change and adapt SAE International/J3016. quickly, this is a real illustration of how long technologies can take to truly penetrate the market. In the recent Smithers Rapra Market Report, “The Future of Autonomous Vehicles and the Impact on Tire Markets to 2026,” forecasts for both autonomous vehicles as well as individual technologies are provided. The report finds that 12.5 million Level 3 and 4.5 million Level 4 autonomous vehicles will be on the road in 2026; however, vehicles equipped with various autonomous technologies are already on the road and growing within the luxury segment. While Level 3-5 autonomous vehicles are not quite ready for public consumption, especially on a mass scale, they are advancing quickly enough for the automotive industry to start thinking about how to optimize tires for these self-driving cars. The artificial intelligence systems aboard autonomous vehicles the vehicle to make a decision based on a tire limit prediction. have dominated the conversation thus far, but the physical com- Additional testing for tire limits on wet and dry surfaces needs ponents of the vehicles are also vital to their success. The tires that to be conducted, so the controller can adjust its actions based are currently used on consumer and commercial vehicles are not on the traction of the surface. necessarily the same tires that autonomous vehicles will require. Tire sensors, which are in the concept stage, could help with The artificial intelligence in an autonomous vehicle, known as traction concerns, but further testing on snow and ice would need the controller, has far different expectations and needs than a to be completed to be sure the sensors would work in conditions human driver, and evaluation of vehicle components needs to that cover road markings and make driving especially difficult. be taken into account. The controller needs to be aware not only of its own actions, but In the past, expert drivers evaluated tires based on ride and also of the actions of surrounding vehicles as well. When driving handling. As autonomous vehicles become more viable, evalu- in a line of vehicles, it is important to detect potential problems ations will be conducted by controls system engineers, and before they cause an accident. This is usually accomplished factors such as subjective handling and steering will be of less through haptic feedback, but the lack of a steering wheel can
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MTD January 2017
prevent detection through normal cues. Detection and accident prevention can be achieved via vehicle-to-vehicle communication, but limiting the occurrences of tire problems in the first place is the best course of action. Tire durability is expected to continue to be an important factor for maintaining vehicle safety. There are two main tests for determining the durability of a tire. One measure is cleat impact testing, which subjects tires to rolling under high load on a straight surface and over obstacles. This will show how a tire withstands extreme impact and weight. The other measure of a tire is conducted through accelerated aging. Accelerated aging exposes the tire to high heat, pollutants and other factors that wear it down over time. It is important to consider all the external elements that will affect a tire, but designing tires for autonomous vehicles will also depend on the structure of the vehicles themselves. They will likely be driven by an electric propulsion system, with a lightweight structure that is desirable for energy efficiency. Lightweight structures will put less weight on tires, but the tires will need to limit the force that is transmitted through them to the structure. If the tire is unable to absorb the punishing force created by driving on rough surfaces, the structural durability will be greatly affected. Another factor that will influence what the tire of the future will look like is the impact of aerodynamics. A thinner tire will be more beneficial in limiting drag, but the tire will still require the same air cavity volume to achieve a suitable load capacity.
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This means that tires will need to be made taller to compensate. Increased tire diameter is generally better for ride, so it will not compromise the comfort of passengers. Aside from diameter, the controller will need to be aware of other tire measurements, including cornering stiffness, braking stiffness, load transfer sensitivity, camber sensitivity and peak grip. Identifying these measurements through testing will make sure the controller is able to come up with quality initial steering and braking input. The measurements also will determine the controller’s compatibility with replacement tires. As autonomous vehicles become standard, testing will be increasingly important in guiding the development of their components. Third party, independent laboratories are already conducting research to define the needs of these vehicles. Considering all the implications of an autonomous driving experience will better prepare manufacturers and laboratories as these vehicles move closer toward widespread availability. ■Dean Tener is the technical manager of Smithers Ravenna (Ohio) Laboratory, Smithers Rapra Technology Ltd.’s main center for tire testing in North America. He has been a tire researcher, designer and tester for more than 30 years, and has held positions at General Motors Corp., Honda R&D Americas Inc. and Bridgestone Americas Inc. With more than 90 years of expertise in rubber testing, Smithers Rapra provides practical and scientific expertise, guidance and industrial know-how at every stage of tire testing, from initial ingredient evaluation to manufacture and end-use.
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feature
Defining safe used tires Fear of the unknown may eliminate them from the aftermarket By Kevin Rohlwing
N
ow that my father has been out the tire business for almost a decade, he’s learning all kinds of interesting details regarding our after hours activities at the shop when we were kids. One of my personal favorites was the practice of strategically positioning scrap tires in the scrap tire trailer so they could be easily retrieved and installed on a friend’s car. I remember a beautiful set of four raised-white letter performance tires that were practically bald, so my boss (not my dad) decided to scrap them rather than sell them used. It was my job to transfer the junk tires to the trailer, which means the plan went off without a hitch. The horse-trader in me couldn’t resist, and I scored some great concert tickets for making my buddies’ car look so good. Those were the good old days. Used tires were quite common throughout the 1900s. They were a great alternative to purchasing new tires, and with only a limited number of sizes on the market for most of the century, it was easy to pick and choose the best scrap tires for stock. On the passenger and light truck tire side, we would keep anywhere from four to six tires in popular sizes and would regularly sell them to people who needed a tire or two in a pinch. It was easy money and made you hero to the customers who were short on cash. On the medium truck side, we kept 20-30 of the popular sizes (steer, drive and trailer) and installed them on a daily basis to truck drivers passing through town with a tire problem. We even had a stack we called “homers” that held air with just enough legal tread depth to get the driver home. Each one came with a 50/50 guarantee: 50 feet or 50 seconds, whichever came first. The drivers would pay $50 to $100 for the tire plus the labor and be on their way in less than 30 minutes. When they were building a riverboat casino just a few miles down the road, I made a killing one summer selling homers to the trucking companies out of Chicago. It was easy money and word spread fast around the construction site that we were the place to go with tire problems. Life was simple back then. Customers were willing to take a chance on a used tire because they had no choice and a new tire was too expensive. The type of people who bought used tires had no grand expectations regarding life and performance. If it failed a few days after I installed it, they understood that they might get a free replacement and they might not. To be honest, the response was dependent on the circumstances, so each case was different. Here’s how it went most of the time. If you were a good customer, I would help you out every time. If you were an
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Size proliferation was just one of the factors that caused a lot of tire retailers to get out of the known used tire business after the fallout from the recall.
occasional customer but still beat me up about price and complained about everything, then it would usually depend on what I had in stock. And if I had never seen you before and was fairly confident would never see you again, well, it was called a 50/50 guarantee for a reason. Technically every tire is “used” after it operates on a vehicle, which means there are hundreds of millions of used tires on the road every day. But there is a difference between a used tire already on a vehicle and a used tire that is off the rim of the original vehicle and waiting to be installed on a different vehicle.
Known vs. unknown There is also a distinct difference between used tires resold by a retailer and used tires sold by a typical used tire dealer who only sells used tires. When a retailer removes a tire from service as a result of a replacement transaction, they are able to assess the condition of the used tire when it is inflated on the vehicle. If there any separations, bulges or other conditions that can only be identified when the tire is pressurized, the tire will be scrapped. The inflation pressure of the potential used tire can be checked before it is deflated to determine if there was any likelihood of prolonged overloading. Retailers can determine if the used tire is in the right application and if it had been rotated regularly. I will admit it’s not a complete history of the tire, but the fact that the retailer took it off vehicle absolutely qualifies as
MTD January 2017
known history. And, as an added bonus, the used tire will get an internal inspection before it is installed on another vehicle. For the remainder of this discussion, I will refer to these used tires as known used tires. On the other hand, the typical used tire dealer has very little if any information related to the life of the tire. In most cases, they don’t know where it came from, how it was stored, how it was maintained, and most importantly, if it was operated with insufficient inflation pressure for the load. All they can do is measure the tread depth and look for any obvious signs of damage. I’m going to refer to these used tires as unknown used tires, because the installer basically has no knowledge of the previous life. The lasting impact of environmental legislation associated with the disposal of scrap tires extends far beyond the elimination of illegal tire dumps. By the 1990s, almost every state had scrap tire laws or regulations that governed the collection and disposal of every tire sold in the United States. Local politicians figured out that they could impose a special tax or fee on tires that would provide the funding to locate and clean up illegal tire dumps and subsidize the scrap tire recycling industry to prevent them in the future. Like any slate of 50 separate state government programs, some of them were good and some of them were pretty bad. That aside, it ultimately created the machine that gave life to the unknown used tire dealer. A nationwide network of new tire retailers became a gold mine for the unknown used tire market. Retailers who sold known used tires could only keep a limited number of sizes in stock, so a lot of good used tires were scrapped. The retailer still collected a recycling fee for every tire before paying the licensed scrap tire hauler to take away all of their scrap tires, so at the very least it balanced out in the end. In many cases, scrap tires turned into a small profit center for the retailer and it solved a major regulatory problem. Whatever the retailer could make in known used tire sales on top of that was gravy.
are the stereotypical characteristics for the local unknown used tire business. While they are definitely more common in the inner city than they are in the suburbs, the unknown used tire business is still alive and well in most communities across this great nation. Like almost everything in life, if there is demand for a service or product, someone will find a way to fill the need.
Aug. 3, 2000 If I could point to a time where the good old days in the used tire business stopped being good, it would be Aug. 3, 2000. That was the day that the National Highway Traffic Safety Administration (NHTSA) announced it was opening an investigation of Bridgestone/Firestone that was ultimately linked to Ford Motor Co. The lives that were lost and dollars that were spent settling civil lawsuits led to sweeping changes that are still being felt today. As someone who grew up in the business, it certainly felt like the industry lost its innocence in the aftermath of that day. During the years after the recall was announced, millions of people were inundated with messages about defective tires, so the level of concern by consumers was naturally increased. There was no place for the manufacturers to hide after the intense negative media exposure. Plaintiff’s attorneys became the beneficiary because they had an easy target after every tire-related accident. It suddenly became a lot easier to convince a jury a tire was defective when every news platform reported on the massive recall for months. Ultimately, I think the public was falsely led to believe that tires were dangerous despite the fact that they are statistically one of the safest products on a vehicle when they are properly inflated and maintained (like any other vehicle component). To this day, too many people still believe a tire failure is automatically caused by a defect because the national media has demonized the industry since the year 2000. Since then, known used tires have continued to fade, especially on the passenger side of the business. The Tire and Rim Association (TRA), publishes the North American standards for tire dimensions, loads and inflation pressures. In 1980, TRA listed 68 passenger sizes, and by 1989, the number increased to 92. Ten years later, the number of passenger tire sizes more than doubled to 202, so the prospects of stocking a wide selection of used tire sizes were dimming. By the time tire pressure monitoring systems became mandatory on all vehicles in 2008, TRA listed 312 passenger tires in its annual yearbook. Size proliferation was just one of the factors that caused a lot of tire retailers to get out of the known used tire business after the fallout from the recall.
Proving the cause of a tire failure is not an exact science. For the hauler or recycler, every tire that is collected becomes either scrap or stock. I actually witnessed a scrap tire recycling operation where the good tires went on one belt to be resold and the bad tires went on the other to be shredded. The inspector would give it a 2-3 second look off the truck and then make the decision. At the end of the good belt, anywhere from three to five unknown used tire dealers would jockey for particular sizes. By the end of the unloading process, each one of them had a pile they purchased for stock in their stores. It was quite civil until some light truck tires came down the belt. Apparently the margins on those tires were worth fighting for, so it was pretty entertaining. It would be unfair and irresponsible for me to comment on the unknown used tire business as an industry, but it’s fair to say that it is less formal than new tire retailing or known used tires in most areas. Hand-painted signs and limited facilities
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Liability and legislation Without a doubt, another major reason for leaving the known used tire business is liability. Insurance companies are driven by data, and if the data shows used tire sales create additional
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Used tire sales exposure, they have to account for that in the premium. Some might charge higher rates for companies that sell used tires without data because of the perceived additional risk. In fact, I wouldn’t be surprised if some underwriters refuse to even quote a policy if used tires are being sold, known or unknown. They’ve either been burned in the past or know of another incident where the insurance company paid a large claim on a used tire failure. To them, the best way to mitigate that type of risk is to just eliminate it altogether. Between the data from the tire manufacturers and the insurance companies to the anecdotal incidents that I know of, I have to agree that there is more risk when selling and/or installing a used tire as opposed to a new one. In most legal cases, it all comes down to policies and procedures. If the defendant cannot produce the policies and procedures for inspecting used tires before they are installed, then it will be used against him/her. Likewise, if those policies and procedures were not followed, then it will be used against him/her. Even if the employees followed all of the policies and procedures to the letter, the company that sold the used tire will still be named in the lawsuit. Contrast that with a new tire sale and installation where most of the liability for the product itself belongs to the name on the sidewall, and it’s easy to see why more retailers are getting out of the known used tire business. Used tire legislation has received a lot of publicity in the last few years, especially the bill that was passed in Colorado in 2014. It is now illegal to sell a used tire with an out-of-service condition in the state of Colorado. If a used tire has 1) tread depth below 2/32-inch in a major groove, 2) cuts that expose ply material, 3) separations, or 4) any damage, then it is illegal to sell and install it in Colorado. Similar legislation has been introduced in Ohio and New Jersey, and it’s one topic where the Rubber Manufacturers Association (RMA) and the Tire Industry Association (TIA) totally agree. It should be against the law to sell unsafe used tires. Proving the cause of a tire failure is not an exact science. In many cases, it comes down to which expert offers the best opinions on why the tire failed. When decisions rest in the hands of a jury, victims typically have the advantage because they’ve lost something and it’s natural to think that by giving them money, the pain will be lessened to some degree. Plus, it’s a tire and some jurors have been conditioned that tires are inherently dangerous. Jurors are also human and humans have emotions, which mean the outcome of a jury trial can be totally unpredictable. People will decide how much responsibility the defendant has to assume based on a number of factors, but it still comes down to which experts are more credible and convincing. In the recent ruling Dukes v. Michelin North America, a Florida jury ruled unanimously in favor of Michelin in an $80
million product liability case. Michelin was able to submit evidence that proved the tire was not defective. According to the Michelin press release, “Evidence proved that the tire was well-designed and well-manufactured but had been previously damaged during its service life and then sold used. The case again highlights the inherent risks of purchasing a used tire.” It’s a victory for Michelin and the industry, but there are still hundreds of other used tire lawsuits either in litigation or waiting to be filed that might not end so favorably for the manufacturer. While I’m sure the insurance industry and the manufacturers are delighted to see a victory in a product liability case involving a used tire, I seriously doubt it will lead to any lessening of their standards. Those who write used tire policies will probably charge more for them and those who choose not to write used tire policies will stay on the sidelines. A few victories are not going to be enough for an underwriter to become more liberal with used tire policies. It’s a high-risk business no matter how you look at it.
Roadblocks ahead The road ahead for the used tire business does not get any smoother or straighter. In my opinion, the whole point of unsafe used tire laws is to criminalize the act of selling an unsafe product that should have stayed scrap. The unknown history used tires that filter through the national recycling systems are always going to include a few ticking time bombs. It could be age or the beginning of a belt separation that only shows up after the tire is inflated. Regardless, the name on the sidewall gets to point the finger at the used tire dealer for breaking the law. Don’t forget that the jury is still comprised of human beings with a wide range of human emotions. Jurors with a strong sense of law and order are going to be influenced when safety regulations are not followed. Another roadblock in store for the used tire industry is tire registration. By now, everyone should know there will be a return to mandatory tire registration at some point in the future. No one can know for sure exactly how it will work, but chances are pretty good that the used tire dealers will have to comply with the same laws as new tire dealers. The goal is to limit the number of recalled tires on the highway. In order to achieve that goal, every tire (new or used) must be registered with the manufacturer or a designated third party so the owner of the vehicle can be contacted in the event of a recall. I know for a fact that TIA is pushing to include used tire dealers in the move to mandatory tire registration, and a number of consumer safety groups are in agreement. For new tire dealers, the known used tire business is declining, and I believe it eventually will become a permanent exhibit
TIA is pushing to include used tire dealers in the move to mandatory tire registration.
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MTD January 2017
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Used tire sales in the “Good Old Days Museum.” Old timers like me will sit around and reminisce about making more money on used tires than we did on new. We’ll complain about the insurance companies, the lawyers, and of course the manufacturers, because that’s what tire dealers do. And we’ll probably admit that it’s just easier to sell new tires because used tires are not worth the risk any more. The logic behind a known used tire sale and installation won’t change, but the insurance industry may reach the point where they collectively say enough is enough and make the decision for us. It’s difficult to predict how long unknown used tires will survive. If it continues on the current path of reselling someone else’s scrap based solely on the amount of remaining tread depth and physical appearance, then there may come a time when a day like Aug. 3, 2000, changes everything. It would have to be something incredibly tragic, because the government would need a really good reason to step in and regulate the unknown used tire industry. Unsafe used tire legislation is going to help, but the sad truth is that many of the used tire store owners won’t care. If a tire blows out and kills someone, the survivors will be looking for a settlement and a used tire dealer with limited assets or insurance doesn’t present much of a target for the plaintiff. They just paint a new sign in a new place with a new name under a new owner while the name on the sidewall gets dragged into another lawsuit.
For the hauler or recycler, every tire that is collected becomes either scrap or stock. I still say there is little difference between a retailer removing a used tire in good condition and installing it on another vehicle as used or rotating a set of used tires already on a vehicle. In both instances, the technician must assess the condition of the tread and the sidewalls and check the inflation pressure to determine if it can remain in service. Admittedly, there will be situations where the application differences between the two vehicles might create an issue, but as long as the requirements for size, speed rating, and load index are met, the basics are covered so there shouldn’t be any issues or differences. Unfortunately, the stigma that accompanies used tires will be almost impossible to shake. Differences between known and unknown mean nothing after a tire failure results in an accident. If the tire was installed used, the installer will have to prove it was in good condition and the manufacturer will have to prove it was not defective. When the dealer operates in the known used tire world, the company will have to defend the policies and procedures that were in place to prevent unsafe
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The scrap tire and tire recycling system creates a vicious cycle of used tires that may never end.
used tires from being installed. And when the installer operates in the unknown world, the name on the sidewall will usually be sitting at the defendant table all alone, again. The scrap tire and recycling system creates a vicious cycle of used tires that may never end. I don’t blame participants in the scrap tire industry. They operate on thin margins like the rest of the tire industry, and the money they make from their used tire sales keeps a lot people employed. They are counting on the used tire dealer to perform a thorough inspection before returning the tire to service. The “standard of care” duty is on the installer, not the recycler. But unknown used tire dealers are not going to let something like liability keep them from buying tires from the recycler armed with the same 50/50 guarantee and reselling them to the public at a profit. It’s practically the definition of capitalism the way they look at it. Most of the time the system works. The majority of the unknown used tires installed every day are just as safe as the hundreds of millions of used tires that operate on the road. When the used tire industry is good, everyone goes home a winner. When it’s bad, people might not come home, but the unknown used tire dealers will keep selling their used tires until some unknown event forces them to stop. ■ Kevin Rohlwing is the Tire Industry Association’s senior vice president of training.
MTD January 2017
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feature
Package deals improve margins on sales of custom wheels By Ann Neal
O
nline selling has squeezed the profits out of custom wheel sales for Damon Nielson. To compensate for the tight margins, he and his sales staff bundle wheels, tires and lift kits into packages for their customers. “The online sale of wheels has pretty much destroyed the market. The main reason we sell the wheels is to gain the package deal,” says Nielson, who owns T&C Tire Factory Inc., which does business as Tire Factory Point S. The sale of lift kit, tire and wheel packages helps offset the longer selling process custom wheels require. The sales process for a set of tires can be five to 10 minutes. For wheels, it can take two to four hours. “If we lift the truck, we’re putting tires on it, we’re putting wheels on it and we’re doing the alignment. The overall package comes out to be a decent margin,” says Nielson. Located in American Fork, Utah, Nielson’s shop provides retail and commercial tire sales and service, including 24-hour emergency road service for truck and bus fleets. He employs 12 technicians and four sales people.
10% of business Drivers’ enthusiasm for spicing up their rides is why Nielson sells custom wheels, which make up about 10% of his business. “Custom wheels are one of the few things people are excited about when they come into a shop. They get to dress up their car, they get to make it unique, and they get to make it their own. Custom wheels go hand-in-hand with tires and lift kits.” Nielson’s typical custom wheel buyer is a 30- to 50-yearold man driving a 3/4-ton or 1-ton four-door diesel truck.
Damon Nielson stocks a small supply of custom wheels at his Tire Factory Point S shop.
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Technician Devin Goodwin services a custom wheel at Tire Factory Point S, which has sold custom wheels since 1971.
“It’s someone who’s been in their career a bit and can afford a $50,000 to $70,000 truck. It’s their first baby, and they want to make it unique.” Nielson relies on same-day delivery from dealers in Salt Lake City, about 30 miles away. He Nielson recently rebranded his shop, which has four tire bays and five mesources from deal- chanical bays, to Point S signage. ers who distribute MHT Wheel and Wheel Pros brands. “With the wide variety of styles, offsets, bolt patterns and finishes, it’s tough to stock the right wheel all the time so we lean on the warehouses.” Fickle consumers are another reason to stock only a few wheels. “Every person’s taste is different. What we may think may be a hot mover doesn’t always fit the mold.”
Talk versus technology Nielson and his staff avoid the virtual try-on technologies that allow a customer to use a computer or mobile device to visualize wheels on their vehicles. They tried the technology but customers felt their new wheels did not look like what they had seen on the computer screen. Rather than rely on a software application, Nielson and his sales team ask customers questions. “Are they looking for a chrome wheel or an all-black wheel? We try to determine what kind of finish they want first. Second, we try to determine what diameter wheel they want, and what fitment as far as stock size or plus size. From there we talk about how they want the wheel to stand as far as offset.” The next step is to go to suppliers’ websites for pictures of wheels. “We’ll print them out and show them. We try to limit what we are showing the customer to what’s available.” Nielson’s staff has completed the custom wheel sales and installer training offered by the Specialty Equipment Market Association. His technicians are certified in the Tire Industry Association’s Automotive Tire Service program. The shop uses equipment from Hunter Engineering Co. Nielson says a balancer which provides a road force measurement is very important. “You need to have state-of-the-art tire changers and balancers, and you need to have staff that is familiar with balancing custom rims. Vibration problems on a custom rim are much more prevalent than on an OE wheel, so you need to make sure you have the right equipment, right adapters, and properly trained and experienced staff.” ■
MTD January 2017
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Counter intelligence
Influence How to use your power for the good of the customer
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lmost nothing I can think of could have table is set; you are the influencer, the difference more influence in our industry than maker, the compelling force, the one with the a sales person at a sales counter who capacity and the power to effect actions and understands the power of influence. behavior. By definition, influence is a “compelling force,” Purchasing tires is more challenging than a force that effects the actions, behavior and selecting a product off the shelf at a pharmacy opinions of others. Whether you see yourself as and considerably more expensive. Searching an influencer or not, you are. Your influence and online for solid research is still less than ideal your ability to influence others is based, in part, as most websites lack compelling comparison on people and circumstances that influenced By Wayne Williams tools, and abandonment rates are high. There is you in your past, continues today, and is largely no denying that the internet has had tremendous true in your future. My simple hope is that this article will influence on tire search and research and will continue to influence you to evaluate your influence as it pertains to do so, but the most powerful influence for tire purchases serving others in our industry and to exercise your influence today is still at the retail sales counter. with ever-increasing effectiveness. In a recent study done by MasterCard, their research Your posture, your tone, your demeanor, your knowledge, showed 63% of shoppers want more information than they your prejudice, your motivation, did two years ago. The article your education, your responsihighlighted a key factor that bilities, your moral compass, your drives consumer behavior: energy level, and your beliefs affect comparison. Comparison your behavior and your ability alone drives a good deal of to influence. Your environment shopper behavior. I point also affects your influence, your this out because consumers employer, your coworkers, the of tires are looking for value, types of customers you deal with, which is a combination of your working conditions and your convenience, helpful recomwillingness to change and effect mendations, knowledgeable positive results for others. Nearly assistance, price, and warranty any of these touch-points, with a coverage. Two of these value little focus and effort, can improve points are objective, the price your daily contribution. and warranty; they are facts. I’m continually amazed at the Three are subjective; convepotentially far-reaching effects of nience, recommendations, and small, positive changes. The graphic knowledgeable assistance are in this article (see page 58) points dependent on the sales staff to the powerful influence that is to add the necessary value in demonstrated at sales counters a consumer’s research. This is around the country every single where the influence comes in. day. Clearly, 50% of all final tire As we move from 2016 into 2017, I urge you The answer to a convenience purchase decisions are influenced to make this a great year for your dealership. question is more than the, at the sales counter or in the show- Strive to be a compelling force for good. “Come on down,” or, “We have room by counter sales staff. Some a bay open now,” or, “We work articles I’ve read regarding the consumer packaged goods on a first-come, first-served basis.” These answers must (CPG) industry point to this powerful statistic: As high be personal and delivered with real concern and care. As as 72% of final product/purchase decisions are made at for knowledgeable, if the study by MasterCard tells us the point of sale, in the store. anything, it’s that consumers are comparing. It’s not like When consumers are selecting packaged goods from a we don’t feel the pre-purchase comparisons every day in shelf, they read the labels, look at the box design, and then our conversations with consumers, but we must offer real, make the final decision in a matter of moments. One more solid, knowledgeable recommendations that meet the value point to ponder, a recent study by a leading research firm expectations of each individual customer. indicates that consumers now rely and prefer “friendly/ The survey revealed another interesting point. S knowledgeable” assistance when making purchases. The hoppers feel as though they are smarter shoppers then
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Counter intelligence
they were two years ago; 82% felt this, and 87% said technology makes it easier to find the product they want. In others words, consumers are more confident of their findings, so we better be better listeners and make solid, knowledgeable recommendations. If our recommendations are contradictory to the consumer’s findings, even if the shopper is wrong, we must find a way to agree on certain points. Remember, you’re an influencer,
more powerful than a speeding internet, a compelling force for good, able to produce actions and beliefs for the good of others. Winners help customers win. ■
Wayne Williams is president of ExSell Marketing Inc., a “counter intelligence” firm based in La Habra, Calif. He can be reached at exsellmkting@gmail.com.
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TIRES FOR PROFESSIONALS
HIGH QUALITY, WIDE RANGE, PREMIUM IMAGE, EXCELLENT PERFORMANCE, LONG-LIFE SPAN. New USA sizes available now For further information and available distribution areas please call Bill Haney (330) 807-8050 bill.haney@apollovredestein.com
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European notebook
60 years of passion, experience and success from a European tire icon
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he tire market in the UK and Europe can to work in a local tire company, Tyre Scotland, be a very unpredictable and challenging where he was fortunate to benefit from a manager business environment in which to work. who knew how to encourage young boys to reach That makes the achievement of anyone completfor realistic challenges. ing 60 years in the industry as one of the UK’s He says, “Another important factor about this most successful business entrepreneurs even job was that if I passed my driving test I would more remarkable. be able to drive a van. So when old enough I I was recently invited to visit and interview Sir passed my test, and eventually a vacancy came Tom Farmer exclusively for Modern Tire Dealer up for a van driver and I got the job. However, to give North American tire dealers a unique By John Stone instead of becoming a van driver, I was shocked to insight into one of the global tire industry’s most learn I had actually been promoted to ‘company flamboyant individuals, a man who was knighted in 1997 representative.’” for services to the European automotive industry. So at just 18, Tom was propelled into being Tyre Scotland’s I was eager to capture Tom’s personal memories and direct contact with customers, and for the next couple of reflections on his long career in the tire retail business, and years he enjoyed travelling all over Scotland and building he didn’t disappoint me as he immediately made it clear up a good reputation in the industry, which directly led to the next development in his already aspiring young career. Tom picked up the story again to say, “I went to work for Tyre Services in Carlisle (in the north of England) who were looking to expand their business into Scotland, tempted by the offer of my ‘own car.’ However, this new job eventually came to an end when the company was acquired by one of the leading tire manufacturers and everything changed.” At this time in 1964 it was still illegal to offer a discount on products, and a fixed price was strictly stipulated by the manufacturer. But not long after this law was abolished, and Tom decided his future lay in selling tires to the public at more appealing prices. So in April of that year, with a stock of 100 tires he started a company called Tyre & Accessory Supplies and placed an advert in the local newspaper stating “Tires 25% OFF” with one determined ambition — to earn £15 (US$18) profit each week! Tom told me, “The business went very well and set me on a trail of events over the next few years which turned out to be the structure of my continual development in the tire industry. I was now known as ‘Tyre King Tommy’ and encouraged by a steady rise in income, I eventually formed a company called Tyre & Accessories.” In 1968 at 27 years of age, Tom received an offer and after a lot of “bargaining,” sold his business for £475,000 (US$592,000) — a great deal of money 48 years ago — and Sir Tom Farmer is one of the European tire market’s true legends. decided to take early retirement and move to San Francisco in America. But within two years he got bored and returned he considered himself to have had an incredible life. After to Scotland and founded Kwik-Fit. The first center opened 60 years of successes, failures and happiness, he wouldn’t in Edinburgh in 1971 and in the following eight years up change anything... even if he could! to 1979 the company grew at a rapid pace, launching over Tom was born in 1940 in Leith near Edinburgh into 50 centers in Scotland and Northern England. a typically Scottish neighborhood where people cared That same year Kwik-Fit acquired the business of Euro for each other. “I had a very loving family but didn’t do Exhaust to raise the total number of centers to 102, followed particularly well at school,” he says. “To be honest I just by the important purchase of Firestone’s 180 depots for didn’t try hard enough.” Leaving school at 15, Tom went £3.2 million (US$4 million) with 82 truck tire centers
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European notebook Fleet was formed to meet the growing needs of the company car driver; a year later the first center opened in Northern Ireland followed by the first center in Eire in 1989, by which time the number of Kwik-Fit centers had grown threefold to 609 and annual turnover was now £193.4 million (US$241 million). The early years of the 1990s saw the company add even more accolades to its name: It captured the government-backed National Training Award, introduced the Kwik-Fit Apprenticeship Programme and achieved the BS5750 quality standard. By the mid-’90s Kwik-Fit had expanded in the UK, Holland, Belgium, Spain, France, GerThere are 23 Farmer Autocare locations in Scotland, all approved as “female friendly.” many and Ireland, increasing being resold to Dunlop for £3.25 million (US$4.1 million), the total number of centers to more than 2,000. Then in therefore displaying an example of Tom’s “eye for business 1999, to the surprise of the industry, Ford Motor Co. made deals.” By 1980 the Kwik-Fit Group had gone nationwide an offer to buy the Kwik-Fit, valuing the business at £1 billion with well over 200 centers, and in the next few years a series (US$1.25 billion). of new services and developments further underlined the The offer was put to shareholders, who accepted, and Tom company’s undisputed position as the leading tire retailer Farmer joined the board of Ford and then resigned in 2002. in the UK including the revolutionary investment in a £2 He then formed Farmer Autocare, and over the last 14 years million computer system, which involved the installation of this second business empire has progressively emerged as Management Action Terminals (MATs) in all centers. Scotland’s most successful independent tire retail chain. It also Also Tom, believing the quality of Kwik-Fit staff was an holds the distinction of being the country’s first auto repair integral part of the company’s continued success, opened his group to be approved as “female friendly.” first Training and Development Centre in 1981. In addition, a With a company trading slogan of “Low prices and great Kwik-Fit Code of Practice was introduced in the same year and customer service,” Farmer Autocare prides itself on offering a further 17 centers opened in Holland. In 1982 the unique the cheapest tires in Scotland and also offers exhausts, bat“no quibble” guarantee was introduced. teries, brake services and MOT vehicle safety and emissions Then in 1984 some more memorable initiatives were testing with a guarantee that for all products “you only pay launched including the award winning “You Can’t Get Better the price you see.” than a Kwik-Fit Fitter” TV commercials. In 1986 Kwik-Fit When asked what was the biggest and most significant change he has seen in the last 60 years in Europe, Tom immediately stated it had to be the emergence of large, powerful wholesalers who in the past decade or so have significantly changed the structure of tire sales in the UK. So, what of the future? Well as far as Sir Tom Farmer is concerned, it will continue to be “business as usual.” As he says, “Retirement is not for me, as I believe it is about ‘graduating’ from one chapter in life to another, and I intend to carry on being involved in the tire and automotive repair industry, which I have had the good fortune to enjoy all my working life.” A defiant statement from one of the European tire market’s true legends. ■
John Stone recently was granted an interview by Sir Tom Farmer to give Modern Tire Dealer an exclusive look into his 60 successful years in the tire industry.
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John Stone has been working within the global tire industry for the past 25 years. In 2004 he launched his own consulting company, Sapphire Media Services, 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 January 2017
Representing more than 600 Independent Tire Locations in 44 States
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Business insight
Batters’ up! From leadoff to clean-up, here’s how to grow your business
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ave you ever felt the only way to grow Yes: “No problem, we will get these tires your business is to build more bays? Or on for you right away.” And: “I will also have you ever walked into the shop in check your alignment to make sure....” the afternoon and froze at the sight of empty bays when the morning seemed so busy? The goal of the third batter is to knock in a One common, yet multi-layered question run and keep the inning going. The cars are in asked of me is, “How do I grow my business?” the bays — now it’s time to set yourself up for Fortunately, there is a blueprint. This blueprint additional service. will not mention marketing or advertising. While This is all about discipline: no poorly docuthose concepts are important and do need your By Dennis McCarron mented inspections, no “pencil whipping,” no attention, this column will focus on the operational forgetting to ask the customer. It’s OK if the side of business growth. We will also use some baseball customer says no to an inspection, it is not OK if your analogies to tie in with this year’s historic World Series. employees sabotage the process. Keep the inning alive. Batting first is your leadoff hitter: car count, car count, The clean-up hitter is the last step (many businesses car count! The leadoff hitter’s goal is to get on base; if he’s try for this too early and end up hurting their business). on base, he has a chance to score. It’s all about Batting clean-up is all about making sure as many people on-base, or in our case, in-bay percentage. as possible cross the plate. A single clears two runs, a Tired of that plateau of 20 cars a day? double the bases, etc. Create a frenzy with free tire rotations This fourth step requires you to focus sales on the easy and free alignment checks. Focus on stuff. After identifying and solving any safety-related building car count and problems during the inspection, focus on maintenance. not how much you Up selling maintenance/brakes/flushes/balancing is easy sell on the ticket. and fast with low comebacks, and allows you to double Also, never ever your hours-times-bays versus car count. turn a car away If one customer says no, it’s OK, move on to the next. because of an issue Trying to swing for the fences every time will end the your shop is capable inning pretty quickly most of the time. of solving. Figure it Let’s look at it this from a numbers perspective. Small out later. Business Tire and Auto in Lubbock, Texas, has four bays. Haggle on due time, It is open five days a week, eight hours a day. The owner’s but never let them leave. average ticket is one billable hour per car, so the dealership’s Always end phone calls with, first goal is to service 32 cars a day (8 hours times 4 bays). “Bring it down now, I’ll make Assuming he charges $100/hour for labor, he collects room.” Hustle. Do not allow any $16,000 a week in labor (8 hours x 4 bays x 5 days x $100/ sales staff or person answering the hours), plus parts and tires. phone to say, “It will take longer than If we call the all-in amount $25,000 a week, that’s $100,000 an hour.” Car count is the highest order of priority when a month, or $1.2 million in sales a year. Maintenance items growing. like alignments and flushes that pay more than the time Second in your lineup is the contact hitter. At the very they take to perform could 1) double your average ticket least this batter is expected to advance the runner, and billable hours and not increase the time the car spends in at most get on base as well. Hitting into a double play the bay, or 2) help you turn cars faster. You could get to eliminates opportunities. $2.4 million in sales with the right crew and reputation. In the tire service business, batting second requires the If you have more than four bays, you should be able to use of what I call (and borrowed from another industry) hit $2.8 million or $3 million. the “Yes, and...” technique. Once your employees get used So unlike the Chicago Cubs, who won their first World to their being more cars in the shop than ever before, Series since 1908, don’t wait 108 years to make it happen. deploy “Yes, and...,” which is tacking something relevant Change starts today. ■ onto the conversation with the customer. Dennis McCarron is executive director of Dealer Strategic Yes: “I can get your oil change done in an hour.” Planning Inc., a company that manages multiple tire dealer And: “Is there any other maintenance you would 20 Groups in the U.S. (www.dsp-20group.com). To contact like to get done today?” McCarron, email him at dennis@dsp-20group.com.
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Focus on industry
Designed with the U.S. in mind Zeta tires feature a complete dealer program By Bob Ulrich
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D International wants to make an impact in the U.S. with its Zeta private brand tire line. Manufactured by Qingdao Sentury Tire Co. Ltd. in Thailand, Zeta is being marketed as a third-tier replacement tire. Company executives, including Managing Director Mike Zhang and Sales and Marketing Director Peter Nicholls, discussed their plans for the brand exclusively with Modern Tire Dealer at the 2016 Specialty Equipment Market Association Show, which was held in Las Vegas Nov. 1-4. Nicholls said Shanghai, China-based SD International is not a newcomer to the tire industry. It has been selling tires since 2002, and has 350 customers in 80 countries. Europe represents 50% of its sales — for now. The company is targeting the U.S. replacement market with the following seven lines (each tire’s mileage warranty is in parentheses). “We’re starting from a small base, but the potential is huge,” added Nicholls. • Verdant (60,000). The high performance broad-line tire is available in 24 sizes ranging from 185/70R14 88H to
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205/45ZR16 XL 87W. An advanced tread design coupled with a “high stylized sidewall design” offers the driver “excellent driving comfort.” The addition of silica in the compound not only aids wet and dry traction, but also lowers rolling resistance.
• Meglio (50,000). The UHP tire is available in 20 sizes ranging from 215/55ZR17 XL 98W to 275/30ZR20 XL 97W. Four wide, straight grooves provide efficient drainage in wet conditions, while a straight rib block design applied to the outside of the contact patch helps increase cornering grip and stability and eliminate unwanted road noise.
• Impero (50,000). The SUV tire, built for vehicles like the Chevrolet Tahoe, is available in 14 20-, 22 – and 24-inch sizes. The tire features four wide, longitudinal grooves designed to improve water drainage. • Etalon (50,000). The CUV tire, built for CUVs like the Ford Edge, is available in 19 sizes ranging from 215/70R16 100H to 255/55R18 XL 109V. Circumferential, zigzag grooves resist hydroplaning. In addition, the optimized tread profile
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MTD January 2017
The Impero SUV tire is designed with anti-hydroplaning lateral grooves for “excellent wet performance.”
design “heavily reduces” rolling resistance, says the company. • Impero A/T (50,000). The all-terrain tire is available in 19 LT sizes and four metric sizes. Its wraparound tread is both aesthetically pleasing and functional: It gives the tire a rugged look; guards against cuts, bruises and impact breaks; and results in “outstanding” traction in muddy or snowy conditions. • Consenso H/T. The highway light truck tire is available in nine 10-ply LT sizes (40,000-mile limited tread wear warranty) and two 20-inch metric sizes (50,000). The 3D wave-patterned kerfs minimize block movement; the result is improved grip and handling. • Impero M/T. The mud-terrain tire is available in eight 10-ply, Q-rated LT sizes. The third in the Impero series of tires, the M/T has specially designed tread block engineered to grip in mud, sand and snow. And its unique stone-ejector grooves and rugged shoulder design help prevent damage from impact.
Sales Manager Bob Stewart said SD International backs all seven lines with a complete dealer program that includes rebates; sales spiffs for the counter people; a co-op program; dealer incentive trips; a 30-day test drive for consumers; and a “dealer friendly” road hazard warranty that covers the first 25% of tread wear. “We want to ultimately vie for second or third replacements,” adds North American Sales Director Dan Wheeler. ■
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Focus on industry
Kumho promises dealers a stable new year Look for UHP, MT and CUV tires in 2018 By Joy Kopcha
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onsistent. Stable. Dependable.” Those three little words detail the outlook and plan for Kumho Tire USA Inc. in 2017, said Jim Mayfield, executive vice president of sales and marketing. The biggest news is Kumho is taking a break from its recent rapid-fire introductions of new products. After 11 new tire lines in the past two years, including four unveilings at the 2015 dealer meeting, Mayfield said the company does not plan to roll out any new tires in 2017. “I think maybe it’s time to let you have some digestive time so you can get these products programmed to where you need them to be,” Mayfield said at the company’s latest dealer meeting in December. “But we’re not stopping the product development process.” New and replacement products are already in development for 2018, including replacements for the all-season ultra-high performance Ecsta 4X II and the Crugen KL33 for CUVs and SUVs, plus a new mud-terrain tire. “Our product replacement process will continue in a much more balanced and organized way. We don’t ever want to get back to a point of introducing 11 new product lines in less than two years. It’s too disruptive for us,” Mayfield said. As for 2017, that “consistent, stable, dependable” motto means dealers will see no changes to their buying programs. The volume bonus and growth bonus plans are staying the same, and Kumho will continue to offer dealers marketing support funds they can access in the same manner as 2016. Payouts and benefits of the Premium Fuel associate dealer program aren’t changing either, but dealers will see one enhancement in 2017. “Every product that says Kumho on the side — that you buy from us, Kumho USA — everything will count toward building brackets toward the Fuel dealers. So your sales people don’t have to keep track of what counts and what doesn’t count,” Mayfield said. Another improvement coming for the dealer program is a faster way to process benefit checks at the end of each quarter. The goal is to return checks to dealers within two weeks. Senior Marketing Manager Brian Gallagher and his team are building new creative assets to enhance dealer training on the company’s products, and the sales team has grown to include four consumer divisions, a commercial division and a growing sales operations team that is working on analytics. Mayfield said, “We have to grow. There’s no hiding that. We’ve been pretty stable; 2016 I think with most of our customers we’ve had nice sales growth, but we’ve got to continue that in 2017.
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Brian Gallagher said Kumho needs to better utilize its NBA marketing. “This is a property we have a huge investment in; we have to activate this better.”
“I’m working with you to grow your business with us in a way that is good for you and good for us, and we’re going to be looking for new business as well. Kumho has to grow and we’re going to do it in a way that is manageable and not disruptive, but we are going to grow our business.”
Good indicators for the start of 2017 Stephen Ewing said market indicators point to 2017 being a good year for tire sales. Ewing, the market intelligence and pricing manager for Kumho, said retail gas prices and vehicle miles traveled have both shown favor on the tire industry. December was the first time in 2016 prices at the pump were higher than a year earlier, and those lower fuel prices have led “to a nice increase” in vehicle miles traveled. As of December, it was up 2.6% — an increase of 53 billion miles driven. “If an average tire is 60,000 miles, that should be an additional demand of around 900,000 units through August,” said Ewing. “That didn’t materialize in the market so the question is then what does that mean? It probably means we’re going to have some nice demand in the coming months as the weather has turned and people realize ‘I need to replace these tires that have worn out.’”
Building the brand The “consistent, stable, dependable” angle applies to Kumho marketing, too, said Gallagher. His team is working to apply a steady hand across all platforms through every month of the year. A big focus is in connecting Kumho to its American hometown. The company calls Georgia “the new heart of Kumho Tire,” with its headquarters in Atlanta and its first U.S. plant now operating in nearby Macon. “We’re building our brand in our new home court; it gives us a lot of presence in the southern region. We want to start there and figure out how were going to build on that to get more exposure,” he said. ■
MTD January 2017
TPMS
2014-2016 Chrysler/Dodge Dart All valve stem components can be serviced and replaced individually SUBJECT VEHICLES: 2014-2016 Chrysler/Dodge Dart RELEARN PROCEDURE? Yes. SPECIAL TOOLS NEEDED?: Yes, a TPMS-RKE analyzer (9936) with a scan tool.
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he tire pressure monitoring system (TPMS) in 20142016 Chrysler/Dodge Darts monitors air pressure in the four road tires (excludes spare). Pressure in the spare tire is monitored in case of a matching spare with sensor. Sensor transmissions occur if there is a significant change in pressure. A radio frequency hub module (RFHM) has to be awake when the sensor transmits to monitor spare pressure. The TPMS consists of tire pressure monitoring sensors attached to each road wheel through the valve stem mounting hole, an electronic display, and an indicator lamp. The system communicates through the RFHM. Upon detection of a warning or fault condition, the RF hub will send a request to the module that controls the indicator lamp and the text display via the vehicle bus system to illuminate or flash the indicator lamp. Also, upon detection of a warning or fault condition, the electronic display will send a request to sound the “chime.� The RF hub will store all wheel sensor IDs and locations and faults in memory that can be accessed through diagnostic communication. All other data values transmitted from each active wheel sensor shall be stored in the RF hub memory. The RF hub automatically learns and stores the sensor IDs while driving within 20 minutes continuously above 20 mph (32 km/h) after a sensor has been replaced. The learning sequence will initiate when the vehicle has been stopped for
more than 20 minutes. NOTE: A new sensor ID can also be programmed directly into the RF hub by using a RKE-TPMS analyzer in conjunction with a scan tool. Once the new sensor ID has been programmed, the RKE-TPMS analyzer can be used to update the TPMS by activating the sensor. If the TPMS detects the tire pressure in any road tire is low,
Figure 1: Identifying the TPMS sensor components.
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TPMS beyond the low pressure (lamp) ON threshold (see placard table), the TPMS will continuously illuminate an indicator lamp. If a system fault is detected, the indicator lamp will flash on/off for 75 seconds, and then remain on solid. If the RF hub detects a warning or fault condition at ignition key “on,” the display module will request a chime once per ignition cycle for the first “warning” or “fault” condition detected. A “warning” or “fault” condition will remain enabled until the problem causing the condition is corrected and removed/reset. If a system fault is detected, a chime will sound, and the TPMS indicator (telltale) lamp will flash for 75 seconds, and then remain on solid. For vehicles with the premium TPMS, a “CHECK TPM SYSTEM” message will appear in the electronic vehicle information center (EVIC), followed by a graphic display. A system fault can occur by many scenarios, including the following: • Signal interference due to electronic devices or driving next to facilities emitting the same radio frequencies as the TPMS sensors. • Installing some form of aftermarket window tinting that affects radio wave signals. • Accumulation of snow or ice around the wheels or wheel housings. • Using tire chains on the vehicle. • Using wheels not equipped with TPMS sensors.
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Reset procedures TPMS indicator Check air pressure as necessary in all tires using a known accurate air gauge and adjust to the specification listed on the tire inflation pressure label (placard) provided with the vehicle (usually applied to the driver side B-pillar). While adjusting air pressure (with key ON to keep RFHM active) in a tire on the vehicle, allow approximately two minutes for the mes- Figure 2: Identifying the TPMS sensage or indicator lamp sor valve stem rib. to go out. (The vehicle may need to be driven for pressure to update.) TPMS sensors NOTE: A new sensor ID can be programmed directly into the RF hub by using a RKE-TPMS analyzer in conjunction with a scan tool. Once the new sensor ID has been programmed, the RKE-TPMS analyzer can be used to update the TPMS by activating the sensor.
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MTD January 2017
The battery-operated TPMS is both a transmitter and a receiver. The TPMS sensor can be forced to transmit if using a special tool such as a TPMS-RKE analyzer. The TPMS-RKE analyzer has the ability to change the sensor mode and to diagnose a faulty TPMS sensor. Using a TPMS-RKE analyzer can take up to a minute to force a transmission from a sensor. Each sensor’s transmitter broadcast is uniquely coded so that the module can monitor the state of each of the sensors on the four rotating road wheels. The module can automatically learn and store the sensor’s ID while driving within 20 minutes continuously above 20 mph (32 Km/h) after a sensor has been replaced. The vehicle must be stationary for more than 20 minutes in order to initiate the learning sequence. The sensor IDs also can be programmed using the TPMS-RKE analyzer tool. Scan each TPMS sensor at each road wheel, and store each sensor ID in the correct location (left front, left rear, right front and right rear). Connect the TPMS-RKE analyzer tool to the scan tool. Then follow the programming steps outlined in the diagnostic scan tool for “Program Tire Pressure Sensor ID w/ TPM Tool.”
Demounting/mounting procedures CAUTION: The TPMS has been optimized for the original equipment tires and wheels. TPMS pressures have been established for the tire size equipped on the vehicle. Undesirable system operation or sensor damage may result when using replacement equipment that is not of the same size, type or style. Aftermarket wheels can cause sensor damage. Do not use aftermarket tire sealants or balance beads if the vehicle is equipped with TPMS, as damage to the sensors may result. CAUTION: Tire pressure sensor valve stem caps and cores are specially designed for the sensors. Due to risk of corrosion,
Figure 3: Aligning the rib in the sensor to the valve stem.
Figure 4: Identifying the valve stem locking pin notches.
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TPMS do not use a standard valve stem cap or core in a tire pressure sensor in place of the original equipment style sensor cap and core. Any time a sensor is to be installed in a wheel, it is necessary to install a new sensor-to-wheel seal, metal washer and valve stem nut, to ensure air tight sealing. CAUTION: When installing the valve core, be sure to tighten the core to specifications. Over-tightening by as little as three or four inch pounds can damage the sensor.
air tight sealing. NOTE: When installing a new valve stem, do not install it with the sensor attached. If it is a new sensor, separate the valve stem from the sensor first and then install the components separately. NOTE: Replace the valve stem assembly with each tire change or when the tire is removed from the wheel. NOTE: When installing a new valve stem, water or water/
Sensor removal NOTE: The tire pressure sensor, the valve stem, and all valve stem components including the cap and the valve core can be serviced and replaced individually. NOTE: When demounting or mounting the tire on the wheel, follow the tire changer manufacturer’s instructions while paying special attention to avoid damaging the pressure sensor. NOTE: Replace the valve stem assembly with each tire change or when the tire is removed from the wheel. Install a NEW valve stem and valve stem core if they are removed from the wheel or valve stem. 1) To remove the sensor from the valve stem, press down on the spring clip using a small screwdriver while pulling (see Figure 1 on page 69). 2) Remove the valve stem from the wheel.
Sensor installation CAUTION: Any time a sensor is to be reinstalled in a wheel, a new valve stem assembly must be installed to ensure
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Figure 5: Identifying the valve stem locking pin first notch seating position.
Quik-Link: 800-687-1557 ext. 11135
MTD January 2017
soap solution should be used for proper provided with the vehicle (usually applied installation into the wheel. to driver’s side B-pillar). 1) Wipe the area clean around the sensor/ Make sure an original style valve stem cap valve stem mounting hole in the wheel. is securely installed to keep moisture out Make sure the surface of the wheel is not of the sensor. damaged. 8) Perform one of the following to make 2) Position the valve stem into the wheel the system learn the new sensor ID: mounting hole with the rib at the 12 A. Once the vehicle has remained stationo’clock position to the wheel, and then ary for more than 20 minutes, drive the pull it through to seat it with a standard vehicle for a minimum of 20 minutes valve stem installation tool (see Figure while maintaining a continuous speed 2 on page 70). above 20 mph (32 km/h). During this NOTE: The valve stem has two notches time, the system will learn the new sensor on the locking pin where the sensor can identification. This is part of the TPMS be installed depending on the thickness of the rim on the wheel (see Figure 4 on page 71). Refer to steps 4 and 5 for installation on both types of wheels. The sensor is properly installed if the sensor is as close as possible to the valve and the locking pin is visible past the spring clip. 3) Install the sensor onto the valve stem by aligning the rib in the sensor to the valve stem (see Figure 6: Identifying the valve stem locking pin second Figure 3 on page 71). notch seating position. NOTE: The valve stem locking pin will be slightly visible diagnostic verification test. B. Use the after installation. TPMS-RKE analyzer (9936) with the scan 4) For a wheel with a thick rim, use the tool to program the RF hub module with first locking pin notch (first from the tip the tire pressure sensor ID. This is part of on the locking pin). Push down on the the TPMS diagnostic verification test. spring clip using a small screwdriver and 9) If a sensor cannot be trained, refer to the slide the sensor up until it stops against appropriate diagnostic information. ■ the bottom part of the valve. Gently pull down to verify the spring clip has engaged Torque specifications Component Ft.-lbs. (N.m) (see Figure 5). Wheel nut 100 (135) NOTE: The locking pin will be highly visible after installation. 5) For a wheel with a thin rim, use the Information for this column comes from second locking pin notch. Push down the Mitchell 1’s “Tire Pressure Monitoring spring clip using a small screwdriver and Systems Guide” for domestic and import slide the sensor up until it stops against vehicles. the bottom part of the valve (see Figure Headquartered in Poway, Calif., Mitchell 6). Gently pull down to verify the spring 1 has provided quality repair information clip has engaged. solutions to the automotive industry for 6) Mount the tire on the wheel and install more than 80 years. For more information, the tire and wheel assembly on the vehicle. visit www.mitchell1.com. 7) Adjust air pressure to that listed on For archived TPMS articles, visit our the tire inflation pressure label (placard) website at www.moderntiredealer.com.
www.moderntiredealer.com
Quik-Link: 800-687-1557 ext. 11136
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Nominations are now open
re Dealer r’s Ti e of l a t De
Modern Tir e
r Award Yea he
25
Send us your choice for our 2017
th
ANNIVERSARY 1993 - 2017
Tire Dealer of the Year We are now accepting nominations for the Silver Anniversary edition of Modern Tire Dealer’s Tire Dealer of the Year award. We are looking for an exceptional tire dealer to join the ranks of 24 other industry greats in receiving the highest honor a dealer can receive. In addition to industry recognition, the winning dealer’s favorite charity will receive a minimum contribution of $1,000 from MTD. The dealer will also be featured in the September issue of Modern Tire Dealer and on-line. In selecting MTD ’s 25th 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. For more information, contact MTD Editor Bob Ulrich at: bob.ulrich@bobit.com.
Snap your smartphone camera on this QR code to go directly to the Tire Dealer of the Year page on our website: www.moderntiredealer.com/tiredealeroftheyear
I nominate for Modern Tire Dealer’s Tire Dealer of the Year: Name ____________________________________________ Phone____________________ Dealership ________________ _________________________________________________ Address ___________________________________________ City ____________________________________ State _____ Zip Code ________________ Nominated by: Name ____________________________________________ Phone_____________________________________________ Relationship with nominee _____________________________ I believe this dealer should be considered because: ___________ _________________________________________________ _________________________________________________ _________________________________________________ _________________________________________________ _________________________________________________ _________________________________________________ _________________________________________________ Mail to: Modern Tire Dealer of the Year, 3515 Massillon Road, Suite 350, Uniontown, OH 44685. Deadline for entries is May 26, 2017.
Products Nexen N’Fera Au7 is designed for wet conditions
OTC system helps remove broken studs
Statistics show rain as the leading cause for driving fatalities in 39 of 50 states. That’s why Nexen Tire America says it created the N’Fera Au7. The N’Fera Au7 is manufactured with an improved tread design that increases wet braking performance and handling with maximum grip to make sure the tire sticks to the pavement. A combination of a chain end bonding system and highly dispersing fine silica maintains elasticity in high-frequency braking and maximizes contact area. Open lateral grooves maximize drain capacity for superior wet performance while 3D kerf sipes reinforce block stiffness for improved wet handling. NEXEN TIRE AMERICA INC. Quik-Link: (800) 687-1557, ext. 11160 www.mtdquiklink.com/11160
The OTC 6982DGS Drilling Guide System assists in removing a broken stud by helping technicians more efficiently prepare to use an extractor. Bosch Automotive Service Solutions says the 6982 Drilling Guide System uses a good stud to center a drilling alignment guide over a broken stud. Fitting the appropriate size bushing and loosely anchoring to the good stud, technicians align the system and drill into the broken stud to bore a well-centered hole. The 6982 Drilling Guide System comes with four alignment guides as well as four bushings in 6 mm, 8 mm, 10 mm and 12 mm sizes. BOSCH AUTOMOTIVE SERVICE SOLUTIONS Quik-Link: (800) 687-1557, ext. 11163 www.mtdquiklink.com/11163
SideWinder tire handler works with an overhead crane
CRP Automotive has antifreeze for Asian vehicles CRP Automotive says Pentofrost Antifreeze for Asian vehicles contains no silicate, borate or nitrite. The company offers a full line for Asian vehicles, including Acura, Hyundai, Infiniti, Kia, Mazda, Mitsubishi, Nissan, Subaru, Toyota, Lexus and Scion. Formulation meets OEM performance, protection and color specifications. Pentofrost Antifreeze is formulated for year-round use. It prevents lime formation, protects against corrosion and cavitation, and never foams. CRP AUTOMOTIVE Quik-Link: (800) 687-1557, ext. 11161 www.mtdquiklink.com/11161
Empower gloves from Adenna come in choice of two lengths Adenna’s Empower nitrile powder-free gloves have double the finger thickness of commonly used nitrile gloves, according to the company. The 8-mil finger is more durable and allows for protection and safety against rougher, more demanding jobs. The glove is suggested for use for in mechanic and industrial applications. The Empower glove is available in two lengths: 9.5 inches (240 mm) and 11.5 inches (290 mm) for additional coverage of the wrist. ADENNA INC. Quik-Link: (800) 687-1557, ext. 11162 www.mtdquiklink.com/11162
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The LiftWise division of Diversified Product Development has introduced the SideWinder, a hydraulic tire handler designed to work with an overhead crane or lift to move, mount and handle tires directly from a horizontal position. The SideWinder has a capacity for tires with diameters from 58 to 75 inches and up to 2,200 pounds, making it ideal for tractors and agriculture equipment, construction equipment and material handlers. The company says one person can remotely operate the SideWinder, which can lift a tire from a flat position and rotate it continuously to vertical for installation. DIVERSIFIED PRODUCT DEVELOPMENT Quik-Link: (800) 687-1557, ext. 11164 www.mtdquiklink.com/11164
Cooper expands Discoverer STT Pro LT tire line Cooper Tire & Rubber has added a 40-inch size to its Discoverer STT Pro light truck product line. The tire is now available in size 40X13.50R17. Cooper says the Discoverer STT Pro provides superior reliability and durability with Armor-Tek3 construction that adds strength to the sidewall and tread area. Mud release dimples and scoops prevent build-up and improve traction in off-road conditions. The Discoverer STT Pro also has a silica-infused tread compound to improve traction in wet conditions and lowers rolling resistance for improved fuel mileage. COOPER TIRE & RUBBER CO. Quik-Link: (800) 687-1557, ext. 11165 www.mtdquiklink.com/11165
MTD January 2017
Quik-Link: 800-687-1557 ext. 11137
To request free product information by phone, call 800-687-1557, enter the extension number listed below, and you will be immediately transferred to the company you want to talk with — it takes only seconds. To request information online, log on to www. mtdquiklink.com/ plus the corresponding Quik-Link number. You’re just a click away from receiving free information on the new products that interest you.
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Advertiser
Page
800-687-1557 + Toll Free Extension
Web site
31 Incorporated
22
11111
www.mtdquiklink.com/11111
31 Incorporated
37
11117
www.mtdquiklink.com/11117
Aftermarket Auto Parts Alliance Inc.
57
11125
www.mtdquiklink.com/11125
American Omni Trading Company
70
11133
www.mtdquiklink.com/11133
Apollo Vredestein Tires Inc.
59
11126
www.mtdquiklink.com/11126
Armstrong Tire
33
11115
www.mtdquiklink.com/11115
AUTEL
21
11110
www.mtdquiklink.com/11110
Automechanika Chicago
66
11130
www.mtdquiklink.com/11130
Bartec USA
69
11132
www.mtdquiklink.com/11132
Big O Tires
47
11121
www.mtdquiklink.com/11121
BKT Tires USA Inc.
11
11105
www.mtdquiklink.com/11105
Blackburn OEM Wheel Solutions
23
11112
www.mtdquiklink.com/11112
Bridgestone Affiliated Retailer Network
39
11118
www.mtdquiklink.com/11118
China International Tire Expo 2017
72
11135
www.mtdquiklink.com/11135
Continental Tire the Americas LLC
41
11119
www.mtdquiklink.com/11119
Dealer Strategic Planning Inc.
79
11138
www.mtdquiklink.com/11138
Falken Tires
15
11107
www.mtdquiklink.com/11107
Greenball Corporation
51
11122
www.mtdquiklink.com/11122
GroundSpeed Tires
55
11124
www.mtdquiklink.com/11124
Independent Tire Dealers Group
63
11128
www.mtdquiklink.com/11128
K & M Tire Inc.
61
11127
www.mtdquiklink.com/11127
Kenda Tires
IBC
11139
www.mtdquiklink.com/11139
Linglong Americas Inc.
7
11103
www.mtdquiklink.com/11103
Marangoni Tread North America Inc.
35
11116
www.mtdquiklink.com/11116
Maxxis International--USA
9
11104
www.mtdquiklink.com/11104
Monroe Shocks & Struts
73
11136
www.mtdquiklink.com/11136
Nexen Tire America Inc.
IFC
11101
www.mtdquiklink.com/11101
North American Tire & Retread Expo
65
11129
www.mtdquiklink.com/11129
Nitto Tire U.S.A. Inc.
OBC
11140
www.mtdquiklink.com/11140
Pantera Tire
19
11109
www.mtdquiklink.com/11109
Pirelli Tire LLC
25
11113
www.mtdquiklink.com/11113
Point S Tire and Auto Services
53
11123
www.mtdquiklink.com/11123
Schrader Performance Sensors
71
11134
www.mtdquiklink.com/11134
SD International
67
11131
www.mtdquiklink.com/11131
Standard Motor Products Inc.
45
11120
www.mtdquiklink.com/11120
STEELMAN Select TPMS, by JS Products
13
11106
www.mtdquiklink.com/11106
Sumitomo Tire
5
11102
www.mtdquiklink.com/11102
Tire Industry Association (TIA)
77
11137
www.mtdquiklink.com/11137
TR Wholesale Solutions
17
11108
www.mtdquiklink.com/11108
Yokohama Tire Corporation
29
11114
www.mtdquiklink.com/11114
MTD January 2017
You know about tires. Now take your business to the next level. Improve Reduce Net Profit Payroll Increase Cash Flow
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Register to visit a DSP 20 Group meeting. 310-533-2428 or email: dennis@dsp-20group.com
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MTD January 2017
www.moderntiredealer.com
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MTD January 2017
Quik-Link: 800-687-1557 ext. 11139
Quik-Link: 800-687-1557 ext. 11140