Modern Tire Dealer - March 2024

WHEREVER YOU ARE, BKT IS WITH YOU

WHY YOU SHOULD OFFER ALTERNATIVE FINANCING CONSUMERS ARE LOOKING FOR FLEXIBLE OPTIONS

BIG TRENDS IN WINTER TIRES WILL ALL-WEATHER TIRES BITE INTO WINTER TIRE SALES?

THE DAUNTING ROLE OF SERVICE MANAGERS

BALANCING SPEED, ACCURACY AND PERSONNEL IS ESSENTIAL

HOW TO MANAGE YOUNG TECHNICIANS

Tire dealers share what works for them

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16

Recent

News

Plaintiffs

46

Reasons

Half

Free

By

IMike Manges

Disaster averted

RECENT BILLS WOULD HAVE HURT TIRE DEALERS, MANUFACTURERS

ndependent tire dealers in Washington state narrowly avoided the heavy hammer of bureaucracy when two bills that would have curtailed their ability to do business stalled before they could be signed into law. If ratified, Washington House Bill 2262 and its companion, Washington Senate Bill 6304, would have been disastrous for tire dealers in the state.

The back-to-back bills also would have placed expensive, unfair burdens on tire manufacturers by establishing completely unnecessary consumer tire rolling resistance regulations.

And frighteningly enough, this only would have been the tip of the iceberg.

Senate Bill 6304, whose language, in some cases, was identical to the verbiage found in House Bill 2262, also called for:

• The creation of a database of replacement tires offered for sale or distribution in the state of Washington;

• “Requirements for any tire brand name owners and tire manufacturers with replacement tires in production offered for sale or distribution in the state to report information” to Washington state officials;

• The establishment of a rating system that would denote the energy efficiency of replacement tires “based on their rolling resistance coefficient,” with ratings displayed for consumers at the point of sale, and;

• The establishment of testing procedures “in alignment with enacted regulations by the National Highway Traffic Safety Administration.”

The bill would have given the Washington State Department of Commerce the ability to prohibit the sale of replacement tires that did not meet minimum energy efficiency standards mandated by legislators and would have allowed inspections of replacement tires to be conducted.

It also would have given the Washington State Department of Commerce — “or another state agency, as designated by the department” — the ability to issue warnings to “tire brand name owners and tire manufacturers who violate rules adopted to implement” rolling resistance regulations.

Repeat violators would have been subject to a civil penalty “ranging from $100 to $10,000 per occurrence,” according to the bill’s verbiage.

Furthermore, the bill encouraged the Washington State Department of Commerce “to coordinate with the California Energy Commission” in order to “pursue common standards, reporting requirements and labeling that reduces compliance costs for the (tire) industry.”

You might remember that the state of California has been looking to establish its own set of consumer tire rolling resistance mandates.

Both the U.S. Tire Manufacturers Association (USTMA) and the

Tire Industry Association (TIA) were quick to state their opposition to both pieces of legislation.

The USTMA said it opposed provisions in the Senate bill that would have granted “authority to the state’s Department of Commerce to make significant decisions about how tires are manufactured, sold and used in the state.

“The flawed proposal would severely reduce the selection of tires available to consumers and disadvantage Washington tire retailers, leaving consumers to travel to neighboring states to find the tires that meet their driving and vehicle needs.

“The misguided policy also incentivizes market decisions by some tiremakers that could adversely impact the safety and longevity of tires available for sale in Washington by reducing tread depth and decreasing wet traction performance, in turn increasing the number of waste tires produced in the state each year.

“Reduced selection will mean higher prices, which will have a disparate effect on more price-sensitive consumers, leading to increased purchases of unsafe used tires.

“Lastly, the proposed policy does not account for legitimate vehicle applications where a tire’s traction performance is more important than fuel efficiency.”

In a statement, TIA said it was “deeply concerned by the potential consequences” of Senate Bill 6304.

“Much like the House bill, there are concerted efforts to advance an agenda that contradicts our stance on safeguarding a retailer’s right to sell certain tires and ensuring consumer freedom in choosing their preferred tires.”

Emboldended by Washington and California’s efforts, could other states introduce their own bills? It will be our duty as an industry to remain vigilant and fight against the imposition of similar directives. ■

If you have any questions or comments, please email me at mmanges@endeavorb2b.com.

Two recent bills in the state of Washington would have been bad news for tire dealers and manufacturers.

Photo: Hey Darlin | 455322783 | Gettyimages.com

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The new year has already brought about a few acquisitions, including one in Canada, where Coast Tire & Auto Service has merged with Andy’s Tire Group. Combined, the companies operate 46 stores, three retread plants and three distribution centers.

Photo: Coast Tire & Auto Service

Prices and profits matter

It’s no surprise that tire dealers are tuned into talk about tire prices. But the interest in that topic may have hit an all-new high with the February filing of a lawsuit that accuses six of the world’s largest tire manufacturers of price fixing. (Read more of the details on page 8.) The suit comes as analysts expect tire prices to fall in 2024.

1. Plaintiff accuses tiremakers of price fixing

2. Photos: Behind the scenes at K&M Tire’s dealer conference

3. New Goodyear CEO: ‘Streamlining the portfolio’ is one focus

4. Coast Tire to merge with Andy’s Tire Group

5. Will tire prices come down in 2024?

6. Goodyear posts fourth quarter results

7. Ziegler Tire President Bill Ziegler dies

8. K&M Tire ‘levels up’ its distribution, customer service

9. Healy talks top exec changes at Goodyear

10. New Senate bill targets tires in Washington state

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Plaintiffs accuse tiremakers of price fixing

CALIFORNIAN, OHIOAN SEEK CLASS ACTION STATUS

Weeks after a complaint accusing six tire manufacturers of price fixing was filed in the U.S. District Court for the Southern District of New York, a second suit was filed in Ohio.

In the initial case, Plaintiff Rena Sampayan is seeking class action status. She accuses Bridgestone Americas Inc., Continental Tire the Americas LLC, Goodyear Tire & Rubber Co., Michelin North America Inc., Nokian Tyres Inc., Pirelli Tire LLC and unnamed “doe defendants” of violating the Sherman Act by establishing “an unlawful agreement … to artificially increase and fix the prices of new replacement tires for passenger cars, vans, trucks and buses sold in the United States.” (The second case, filed by John “Jack” Bengel, is nearly identical to the first and names the same tiremakers.)

Those “doe defendants” refer to “other individuals or entities who engaged in or abetted the unlawful conduct” of the already named tiremaker defendants. The first suit, filed on Feb. 7, may be amended to add names of additional defendants.

Sampayan is a resident of California, who according to the complaint, bought tires in her home state from Goodyear.

In seeking class action status, her case looks to represent those who have purchased tires from the aforementioned tire companies in the U.S. since Jan. 1, 2020. And though the exact number of affected parties is unknown, the petition notes that due to the nature of the product and business, there are potentially “millions” of class members throughout the country.

The action alleges that the six tiremakers “coordinated price increases, including through public communications,” and states that the allegation is “supported by, among other things, defendants’ sudden and dramatic parallel price increases, which absent a conspiracy to fix prices, ran contrary to their economic interests;

EC (European Commission) dawn raids of defendants; the high level of market concentration in the tire market; significant barriers to entry; lack of economic substitutes for tires; standardization of tires with a high degree of interchangeability; and the myriad opportunities that employees of defendants had to conspire with one another to fix prices of tires.”

The complaint questions whether the tiremakers “conspired with one another to restrain (the) trade of tires” and whether their conduct “caused the prices of tires sold directly to wholesalers, retailers and consumers to be higher than the competitive level.”

The suit lists 31 price increases that were put in effect for replacement passenger and light truck tires from 2021 to 2023.

The suit also notes that prices have remained high even as inflation and the effects of the COVID-19 pandemic have eased and that certain tiremakers have noted positive outcomes in various earnings reports.

Goodyear, for example, noted in the first quarter of 2022 that its price hikes “more than offset” its costs. And Conti-

nental reported that its (automotive) sales volume increased by 19.3% in 2022.

As to why tiremakers would allegedly resort to price fixing, the complaint accuses the six tiremakers that were named of looking for a path to profitability following the pandemic.

When domestic travel was hampered by measures to combat the spread of the virus, the demand for tires was reduced.

Supply chain issues and higher costs “caused profit to shrink” even as travel began to rebound.

“To remain profitable, defendants needed to pass on these costs to consumers,” the suit alleges.

The case seeks to represent those “that purchased tires directly from defendants at supercompetitive prices to recover treble damages, injunctive relief and other relief as appropriate, based on defendants’ violation of federal antitrust laws.”

When reached for comment, a Michelin spokesperson said that “Michelin strictly complies with antitrust laws in all countries where it operates. We will cooperate with regulators and defend ourselves in any litigation that is filed.”

A spokesperson for Nokian confirmed the suit and said, “We always operate in compliance with laws and regulations, ensuring everything is done correctly. We comply with relevant anti-trust laws and do not tolerate any violations of them.”

A spokesperson for Continental said, “Integrity is an integral part of Continental’s corporate culture and is anchored in our code of conduct, which applies to all Continental companies worldwide. We have a zero-tolerance policy when it comes to compliance and thoroughly follow up on and investigate all alleged allegations. Our policy (is) to not comment regarding active litigation.”

Spokespeople for Pirelli and Bridgestone said their companies do not comment on litigation.

Class action lawsuits filed against six tiremakers claim they violated antitrust laws and colluded on tire prices in an effort to boost profits.

Photo: MTD

Bites Industry News

Titan acquires Carlstar

Titan International Inc. has bought Carlstar Group LLC for $296 million in cash and stock. The deal includes four Carlstar plants and 12 distribution centers across North America and Europe. It also diversifies Titan’s product portfolio into new categories.

Gill’s acquires Berg Tire

Gill’s Point S Tire & Auto Service, which is based in The Dalles, Ore., has acquired Glendive, Mont.-based Berg Tire Inc. Berg Tire was a single-location dealership and had been owned by Matt Berg and his father, Jay Berg, who expanded the shop over the years.

Touchette to add D/C

Groupe Touchette Inc. has acquired 6.6 acres of land to construct a 112,000-square-foot distribution center at CentrePort Canada, an inland port and foreign trade zone. The new facility will bring the company’s total space to 212,000 square feet on 12.6 acres in Brookside Industrial Park West, located in Rosser, Manitoba.

Chandgie promoted at YTC

Yokohama Tire Corp. has promoted Stan Chandgie from executive vice president of sales and support to chief operating officer, effective April 1, 2024. In his new role, Chandgie will retain oversight of consumer and commercial sales, and add marketing, tire business planning and supply chain/logistics to his responsibilities.

Hino picks Hankook

Hino Trucks and Hino Canada have selected Hankook Tire America Corp.’s AH37 and DL11 TBR tires for the U.S. and Canadian markets. The medium truck maker will offer Hankook’s AH37 and DL11 tires in its L Series models.

Ascenso names president

Ascenso Tires North America has named Thomas Clark as its new president, effective Feb. 14, 2024. Clark has been in the industry for three decades and has worked at the Michelin Group and the Carlstar Group. In his new role, Clark will oversee and manage operations in the U.S. and Canada.

Ziegler Tire President Bill Ziegler dies

Bill Ziegler, longtime president of Massillon, Ohiobased Ziegler Tire & Supply Co. died Jan. 29. He was 75 years old.

Born to Herbert and Gervasa Ziegler, Bill, after graduating from The Ohio State University and working as an accountant, joined Ziegler Tire, his family’s business, in 1975.

Bill became president of Ziegler Tire in 1999. Under his direction, the dealership, which was founded in 1919, has grown to encompass nearly 30 stores and three distribution centers across multiple states.

“Bill is a true leader,” Harold Ziegler Jr., then Ziegler Tire’s assistant treasurer, told MTD in 2009, after Bill was named MTD’s Tire Dealer of the Year.

Harold credited Bill with being the catalyst behind the company’s growth and success.

Ziegler Tire’s employees “look up to him. They know (Bill is) responsible for keeping the company together and he’s done a darn good job.”

“There’s a presence about him that when you step between the lines for that game every morning at 7 o’clock, you know what you have to do,” John Ziegler Jr., vice president of Ziegler Tire, said about Bill. “You’re doing it for him, but he’s doing it for the company.”

“Relationships are very important to Bill — not only with the tire manufacturer, but with the consumer and even his community,” said John Baratta, then-president, consumer replacement tire sales, for Bridgestone Americas Tire Operations LLC.

“Bill is the type of person you’re proud to be friends with,” Francois Corbin, thenchief operating officer for Michelin Americas Truck Tires, also told MTD in 2009. “He has very strong personal values, ethics and credibility.”

Wonderland Tire buys Carter Tire

Byron Center, Mich.-based Wonderland Tire Co. has acquired Carter Tire & Automotive, which is located between Wonderland Tire’s stores in western Michigan and its Chicago, Ill., store.

“This strategic move marks a significant milestone in Wonderland Tire’s ongoing commitment to growth,” say Wonderland Tire officials.

“The acquisition of Carter Tire & Automotive will give Wonderland Tire a step into a new area and market,” with Dave Langerak, Wonderland Tire’s chief operating officer, calling the newly acquired dealership “a nice fit.”

Carter Tire & Automotive is based in Elkhart, Ind.

“The acquisition of Carter Tire & Automotive will give Wonderland Tire a step into a new area and market,” says Dave Langerak, Wonderland Tire’s chief operating officer, with Patti Piscione, former owner of Carter Tire & Automotive.

Wonderland Tire officials say they will ensure “a seamless transition for Carter Tire & Automotive, its employees and its customers. Current customers of Carter Tire can expect uninterrupted service.”

Jon Langerak, the CEO and president of Wonderland Tire, was named MTD’s Tire Dealer of the Year in 2023.

Under the late Bill Ziegler’s direction, Ziegler Tire & Supply Co. grew to encompass nearly 30 stores and three distribution centers across multiple states.

Photo: MTD

Photo: Wonderland Tire Co.

WHEREVER YOU ARE, BKT IS WITH YOU

Bites

Pirelli hits milestone

Pirelli & Cie SpA’s Guanajuato, Mexico, consumer tire plant has produced its 50-millionth tire. The plant, which opened in 2012, focuses on “the high value segment”— specifically, high performance and ultra-high performance tires for cars, electric vehicles, light trucks and SUVs, say Pirelli officials. Pirelli also has opened its first training center in Mexico, which will help develop local talent.

Chapel Hill Tire partners

Chapel Hill Tire has announced its partnership with the North Carolina Triangle Apprenticeship Program. The program starts from 11th to 12th grade and spans four years with academic learning and hands-on training. Participants will work towards an associate degree at a local community college and gain paid on-the-job experience at Chapel Hill Tire’s facilities.

NETSA plans event

The New England Tire and Service Association (NETSA) will hold its annual trade show and education event on April 5-6 in Uncasville, Conn. The trade show and seminars are open to all active automotive, tire and service providers, owners, managers and service staff. The event will also feature inductions into the NETSA Hall of Fame, as well as a scholarship auction.

Etheridge joins CMA

CMA LLC/Double Coin has named Patrick Etheridge a regional sales manager for its Mid-South and Rocky Mountain regions. Etheridge worked at Bridgestone Americas Inc., Giti Tire (USA) as a key client leader and at Prinx Chengshan Tire North America Inc. as that company’s vice president of sales.

Toyo pairs with BMW

Toyo Tire U.S.A. Corp. has announced a new multi-year agreement with BMW Car Club of America that extends through 2026. Toyo will continue to support the BMW Club Racing segment and is also expanding its contingency sponsorship with a payout program available for E30, E36 and E46 Spec classes and non-spec classes.

Longer wait for Thailand tariff decision

The preliminary phase of the investigation by the U.S. Department of Commerce to determine whether tariffs should be levied against truck and bus tires from Thailand has been extended slightly.

The United Steelworkers union requested and was granted an extension in the case. Lawyers for the union petitioners asked for the extension due to the “complexity of the issues presented in this investigation.”

Requests for extensions and them being granted are common in these causes.

As a result of this request, the Department of Commerce is pushing out the deadline by another 50 days. The new preliminary ruling is due by May 14.

Once the preliminary ruling is issued, the case moves on to a “final” phase. Unless an additional extension is granted — and that’s possible, too — the final determination would come 75 days after the preliminary ruling is issued.

ZC Rubber considers plant in Mexico

Zhongce Rubber Group Co. Ltd (ZC Rubber) wants to build a tire factory in Mexico to serve the North American market.

The tiremaker says it is looking to establish a 6.5 million square-foot plant in Saltillo, Mexico, along with an on-site warehouse to serve the North American market “to improve (our) local distribution network and optimize cost efficiency.”

In Saltillo, ZC Rubber says the plant would be about 150 miles from the U.S.-Mexico border, which “makes it an ideal choice to meet the dynamic demands of both the Mexican and North American markets.”

In a statement from the tiremaker, Henry Shen, vice president of ZC Rubber, said, “Our plan to open a tire factory in Mexico demonstrates our commitment to meeting the growing demand for high-quality tires in the region. While we explore this opportunity, we remain focused on our customers’ needs and operational efficiency by setting up a complete local distribution network.”

K&R opens Goodyear retread plant

There’s a new Goodyear retread plant at K&R Truck Sales in Flint, Mich. The plant features “state-of-theart equipment and an experienced staff with several decades of experience,” according to K&R officials.

The facility can retread radial commercial truck tires with sizes ranging from 225/75R16 through 445/65R22.5, as well as OTR tires, while providing section repairs on ag and earthmover tires. It also offers wheel reconditioning, forklift tire pressing and other services.

K&R sells Goodyear, Roadmaster and Cooper brand tires, plus other tire brands, and provides emergency road service.

“We are excited to expand our tire operations into the retread market,” says Ed Rietman, owner of K&R.

ZC Rubber says it is contemplating another new tire factory. This one would be built in Mexico and designed to serve the North American market.

Photo: ZC Rubber

K&R Truck Sales has opened a Goodyear retread plant in Flint, Mich.

Photo: K&R Truck Sales

Bites

Arroyo names ambassadors

Arroyo Tires has announced an exclusive partnership with three brand ambassadors for the year 2024. The three influencers are James Outman, center fielder for the Los Angeles Dodgers; Adam Waheed, comedian and social media influencer; and Parker Nirenstein, automotive YouTuber and owner of Vehicle Virgins YouTube channel.

New Cosmo store opens

Miami, Fla.-based Tire Group International LLC (TGI) has added another location to its Cosmo retail store network in Santa Elena del Uairen, Venezuela. The store is a collaboration with longtime partner BV Pneus. TGI’s first Cosmo store opened in Florida last summer.

Ascenso sets campaign

Ascenso Tires North America has launched a new campaign, Tracks of Triumph, to celebrate the company’s channel partners. In the campaign, the channel partners discuss how the brand’s products and services help them achieve their goals.

Veterans to consult

MK Value Creation Advisors is a consultancy founded by industry veterans Marty Krcelic and Tim Miller. They assembled a team of five executives with a common vision for delivering tailored solutions to drive value for businesses and private equity investors. The team members previously collaborated for many years at TBC Corp.

Turbo partners with Rams

Turbo Wholesale Tires LLC announced a brand partnership with Kyren Williams, running back for the LA Rams football team. Williams will serve as the official ambassador for Turbo Wholesale Tires’ Lexani performance tire brand. His teammate, Cooper Kupp, was Lexani’s previous brand ambassador.

SRNA promotes Johnson

Sumitomo Rubber North America Inc. (SRNA) has promoted Tsuyoshi “TJ” Johnson to director of product planning for the company’s Falken passenger and light truck tire lines. He joined SRNA nearly eight years ago.

Sun Auto moves into Ohio

Sun Auto Tire & Service Inc. has acquired seven-location Boyd’s Tire & Service in central Ohio.

The acquisition marks the Tucson, Ariz.-based company’s entry into the state. “Boyd’s being welcomed into the Sun Auto family is a milestone in our growth journey,” says Tony Puckett, CEO of Sun Auto Tire & Service.

“We are thrilled to make our first entrance into Ohio, which is a region that is going to be very important to our plans going forward. I can’t wait to welcome these new members of the Sun Team into our group.”

“Joining forces with Sun Auto is a promising development for Boyd’s,” says Gary Taylor, district manager for Boyd’s Tire & Service.

“We’re excited to integrate our commitment to excellence and service passion with the horsepower that Sun Auto has demonstrated through their growth. Our teammates are the most important facet of our business and we’re thrilled to have chosen Sun Auto as a trusted partner for their continued benefit.”

VIP sets new donation record

VIP Tires & Service announced employees donated more than $275,000 to Make-A-Wish in 2023.

This brings VIP Tires’ total contribution in recent years to over $1.275 million for Make-A-Wish.

“In 2023, the VIP team took our support for Make-A-Wish to an entirely new level, setting a new record with over $275,000 in contributions to one of the world’s most impactful charities,” says Tim Winkeler, president and CEO of VIP.

“VIP keeps proving that businesses large and small can play a pivotal role in helping those in need and I couldn’t be prouder of our employees for supporting such a noble cause. Doing the right thing goes a long way and we can’t wait to support Make-A-Wish to an even larger extent in the years ahead — hopefully setting more records along the way.”

“These funds will directly impact the lives of children battling critical illnesses throughout northern New England and in turn, (will) spread hope and joy throughout so many local communities,” says Kate Vickery, president and CEO of Make-AWish Maine.

Bridgestone puts winter tires to test

Bridgestone Americas Inc. recently put its Blizzak line of winter tires through the paces at its winter driving school in Steamboat Springs, Colo. During the event, Bridgestone also provided an overview of tires that feature its ENLITEN technology.

Tim Winkeler, left, president and CEO of VIP Tires & Service, along with, back row from left, Rob Kaffel, region director for VIP, and John Quirk, owner and chairman, present the 2023 donation to Make-A-Wish Maine President and CEO Kate Vickery. Also pictured, at right, is VIP Senior HR Manager Mary Daigle.

Photo: VIP Tires & Service

Photo: MTD

Numbers ThatCount

Relevant statistics from an industry in constant motion

13.86 MILLION

Number of commercial trucks registered in the U.S.

Source: American Trucking Associations

TravelCenters of America

$200 MILLION

2024 investment in grants for apprenticeship programs in in-demand industries, including transportation and manufacturing.

5,418

Source: U.S. Department of Labor

Canadian Treads Corp.

Number of service trucks operated by the nation’s ve largest commercial tire dealers in 2023.

Source: MTD Top 25 Independent Commercial Tire Dealers List

5.3%

Source: IMR Automotive Research

Photo: MTD

Percentage drop in consumers since 2013 who turn to car dealerships for automotive service.

4.3%

Overall growth of the technician workforce from 2021 to 2022.

Source: TechForce Foundation’s 2023 Technician Supply & Demand Report

MTD

Photo:

Photo: MTD

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By

John Healy

RDealers say tier-one prices are ‘too high’

TIREMAKERS BALANCE VOLUME AND PRICE

etail sellout trends in January 2024 were slightly negative following positive sellout trends in the month of December. On average, dealers saw retail unit sales fall 0.4% year-over-year in January, following a 1.1% gain in December.

Regionally, the Northwest saw the strongest trends, up double digits compared to a year ago. That growth was driven by weather — specifically, heavy snowfall. That said, the Midwest, Northeast, Southeast and Southwest regions all saw volumes on the negative side of the ledger in January. The Southeast saw the softest trends, with volume down 6.3% in the month.

Seven percent of our dealer contacts reported negative demand in January, a sequential improvement from the 25% of our contacts who saw negative demand in January 2023. Those who experienced heavy snowfall reported a sharp increase in demand during the month.

Apart from weather-driven trends, tire dealers report sellout levels continue to be affected by elevated tire prices and the macro environment, which includes a lack of rebate offers from tire manufacturers. It appears the consumer trade down and deferment cycles continue to hang over the retail tire industry.

We have long hypothesized that an acceleration of winter weather could spark a catch-up period. We’ve now begun to lap the one-year mark of soft sellout trends — with few signs of positive

momentum, except for what was recorded in the Northwest. From our view, the tire market remains in neutral to start 2024.

However, miles driven data continues to point in the right direction. Trends were positive in January for the third consecutive month.

We note that our miles driven momentum index registered a 1.7% year-overyear increase in January, following a 1.8% increase in December 2023.

While volume and demand trends are likely less than hoped for at this point in the year, we believe underlying fundamentals for tire replacement and the broader aftermarket show a healthier backdrop compared to this period one year ago.

THE PRICING QUESTION

The combined raw material costs to build a replacement tire fell an average of 0.5% in January, following a 3.3% year-over-year decline in the fourth quarter of 2023. Collectively, last year our tire raw material index fell 9.6% from 2022.

Following a year of cooling inflationary prices — every month of 2023 registered a year-over-year decline — we now see aggregate raw material prices only slightly below levels from a year ago.

We expect manufacturers will try to hold onto price as long as possible.

That said, we continue to believe there may be a level of price decreases at some point in 2024 as raw material costs stabilize

and inventory levels appear to be more normalized.

Manufacturers may concede some price to encourage tire wholesalers to begin taking on more inventory.

TIER-ONE PRICES ‘TOO HIGH’

Dealers indicate that tier-two tire brands were the most in-demand from consumers for a second straight month. Dealers continue to mention they’re seeing the effects of consumers trading down.

And several independent tire dealers noted that the elevated price point of tier-one tires is “simply too high for most consumers.”

We note tier-two brands being the most in demand matches the historical trend we’ve seen in the 10-plus years of our monthly tire surveys.

In January, tier-one brands were the least in demand, marking a fifth straight month of these brands placing last in our survey. This is the first such occurrence of tier-one in the bottom of the rankings for five or more consecutive months since August 2020 through April 2021.

During the COVID-19 pandemic, tier-one tires were in last place for nine straight months.

We remain of the view that longerterm, consumers will opt for tier-two tires as they look for a balance of price and performance.

We continue to believe the North American pricing environment will remain in line with raw material costs. We expect tier-one and tier-two tire producers to continue to be disciplined in managing the trade-off between price and volumes to maximize operating profit rather than market share. ■

John Healy is a managing director and research analyst with Northcoast Research Holdings LLC, based in Cleveland, Ohio. Healy covers a variety of subsectors of the automotive industry. If you would like to participate in the monthly dealer discussions, contact him at john.healy@northcoastresearch.com.

Technician management

How to manage young technicians TIRE DEALERS SHARE WHAT WORKS FOR THEM

By

Madison Gehring

Developing a pipeline of talented, young technicians remains a challenge for many independent tire dealerships. Managing these workers once they have been hired presents another challenge.

In this MTD exclusive, Weston Chapman, owner of Rapid City, S.D.-based Black Hills Tire; Todd Ward, general manager at Chapel Hill, N.C.-based Chapel Hill Tire; Pam Konde, owner of Mac’s Tire Service in Washington, D.C.; and Alvin Chase Jr., president of Rockland,

Maine-based Eastern Tire & Auto Service Inc., discuss how they manage young technicians.

One thing they agree on is that there’s no one-size-fits-all formula.

DIFFERENT EXPECTATIONS

“I wouldn’t say there is a difference in how you manage older technicians compared to younger technicians, but there is a higher expectation of older technicians,” says Konde, whose busy, single-location dealership is open around the clock.

“For example, there is less room for careless mistakes” made by more experienced workers “because you expect these technicians to ‘know better.’”

Konde says that based on what she’s seen, older technicians come with more expectations than younger, less experienced technicians.

But Chapman of Black Hills Tire says setting expectations with your younger technicians is even more important than setting expectations with older technicians.

Todd Ward, general manager of Chapel Hill Tire in Chapel Hill, N.C., believes a big factor in why young people like working at his dealership is because its stores are closed on Saturdays.

Photo: Chapel Hill Tire

“Not only is it important to set expectations for your younger technicians — and communicate those expectations with them — but it’s also important that we, as managers, follow through and check up on them and those expectations,” he notes.

He says younger technicians often need more guidance and monitoring to make sure they are meeting their goals.

“It’s one of the biggest things I’ve noticed. You need to believe in them and give them a chance, but then make sure they’re following through on those expectations.”

Eastern Tire & Auto’s Chase agrees.

He says that when an older technician with experience is assigned a job, the service manager typically sets an allotted timeframe that dictates its completion.

However, that timeframe is “probably going to be different for a young person who’s starting out.”

Chase says Eastern Tire & Auto has 14 bays and 27 technicians.

“We strategically place our younger employees in between our older employees in the bays. That way, we don’t have all of

Where do you find young technicians to employ at your dealership?

our young people shoved into one corner. They are close to an experienced employee, if they were to have any questions.”

Ward of Chapel Hill Tire says it’s also important to help keep your younger employees’ expectations of themselves realistic.

“What we’ve found with our younger technicians is that they’re eager to learn and they want to learn,” says Ward.

How do you retain younger technicians at your tire

“However, they have little patience when it comes to advancing. They want to grow quickly and climb the ladder quickly.”

Technician management

This results in younger technicians sometimes jumping into jobs they aren’t ready for, which leads to mistakes they “beat themselves up over.

“We also have to help them manage their emotions and expectations and keep them patient,” he says.

In order to motivate his younger employees, Chapman says his dealership pays younger technicians when they work training hours to “compensate for the lack of experience and all that comes with that experience.

“This way they can take their time and really learn things the right way without having to worry about paying their bills,” which, he says, has been a big motivator.

WHAT MOTIVATES THEM?

“Our younger employees are definitely driven and motivated by money because housing and living are so expensive right now,” says Ward.

Chase agrees and says his younger employees care more about hourly wages than 401(k) plans or health insurance.

“As you’re young and just starting out, you don’t want to be in debt and you want to keep out of debt — and I think that’s great,” he says.

“So we’re going to be fair. We’re going to give you the appropriate wage for your work.

Where do you find young technicians to employ at your dealership?

We’re not going to only pay you $19 an hour because you’re only 20 years old. There is a job to do and we want our employees to know we’ll compensate them accordingly.”

High school vocational schools

its employees work 40 hours a week, from 7:30 a.m. to 4 p.m.

Dedicated vocational schools

Flat rates may be a repellent for some younger technicians, according to Chapman.

Other tire dealers

12%

“I am confident I’d have a mutiny if I asked my people to work past 4 p.m. or work on a Saturday,” he says with a laugh.

Tire retailers (big box stores)

“I think a lot of the younger techs got scared out of the tire industry by a flat rate or being worried that the job wasn’t going to provide for them. I think we take a pretty strong stance there to make sure they’re in charge of their own paycheck.

*Data from MTD's LinkedIn.

“The harder they work and the more they produce, the more they make.”

GENERATIONAL IMPACT

“We’re at the point in time where we must grow our talent instead of looking for it,” says Ward, who adds this is one reason why it’s so important to reach out to and hire younger employees.

46%

“Younger techs are more open to change and they adjust and adapt quicker, whereas older technicians tend

How do you retain younger technicians at your tire dealership?

Flexible hours/ schedule

All four tire dealers agree that work-life balance is a main motivator for younger technicians, too.

“When they start, younger technicians seem to be driven by salary,” says Konde.

“But some are definitely more interested in having lots of free time — especially on Saturday nights and during football season.”

Ward believes a big reason why young technicians like working at Chapel Hill Tire is because the dealership is closed on weekends.

Chase says this desire for more off-time is the reason Eastern Tire & Auto cut back on its operating hours.

“We used to work 50 to 60 hours a week — six days a week, from 7 a.m. to 6 p.m.,” he explains.

For the past three years, Eastern Tire & Auto has been closed on Saturdays and

to get stuck in their ways and become resistant to change,” he explains.

Konde agrees that younger technicians are more flexible when it comes to learning new technologies and techniques, but says it’s up to tire dealership owners and managers to learn about their employees’ work and career objectives.

“It’s important for managers to find out their technicians’ ‘why.’ What are their goals? Is working as a tire technician a main goal or is the plan to do (only) this in the short-term?

“Once you know their ‘why,’ then you can work to create a schedule or plan that works to the benefit of the company, but also allows the tech the time that they need to achieve their personal goals.”

Chase says understanding employees’ motivations is critical, adding he is “cautious on giving advice because I don’t

Weston Chapman, owner of Rapid City, S.D.-based Black Hills Tire, says young technicians often need more monitoring and guidance to ensure they are meeting their goals.

Photo: Black Hills Tire

want anyone to tell me how to run my business. So I’m sure people don’t want me telling them how to run theirs.

“With that in mind, I think the trick for managing younger employees is to do everything you possibly can to satisfy (them) while (meeting) the demands of your customer base.”

This can be done in a number of ways, according to Ward.

He says managers should be intentional when developing younger technicians by giving them “regular meetings and having scheduled re-occurring meetings to discuss their progress and growth.”

It’s also important, notes Chapman, to celebrate young technicians and introduce them to the “more exciting parts of the industry.

“We have many technicians who work for us right now who are in vocational schools on a scholarship we provided for them.

“Once these younger technicians graduate from their auto tech program, we take them to the SEMA Show. That’s a pretty cool reward for a 21- or 22-year-old kid.”

Chapman took two recent auto tech graduates who recently turned 21 to the 2023 SEMA Show.

“It absolutely blew their mind,” he says. “We were worried taking recently turned 21-year-olds to Las Vegas for the first time, but by the time we got done walking through SEMA every day, they were so tired they went back to the hotel and went to bed!”

Konde notes it’s also important to be realistic while understanding this “information era that we live in.

“It may not be reasonable to ban the use of cell phones during a shift, but you can make a rule not to use the phone while dealing with customers to avoid error and distraction,” she says.

According to Konde, the most important thing to keep in mind when managing young technicians is to “treat them with the same level of respect as you would anyone else, regardless of their age.

“These younger technicians have ideas and valuable input to offer, as well,” she adds.

“This is an amazing industry,” says Chapman, “and we are proud to be a part of it and excited to get young people into it.” ■

Chapman says that once his younger technicians finish tech school, he takes them to the SEMA Show.

Photo: Black Hills Tire

Winter tires

“Our compounding technologies continue to evolve to meet the needs of our customers in severe winter weather conditions,” says Philipp Schrader, product manager for touring and U.S. winter tires, PLT, Continental Tire the Americas LLC.

Big trends in winter tires

WILL ALL-WEATHER TIRES BITE INTO WINTER TIRE SALES?

By

Madison Gehring

For many consumers, the world of winter tires can be a complicated one to understand and with the rise of all-weather tires, it may get even more complicated.

MTD recently asked tire manufacturers to discuss the latest winter tire trends and technologies and if they see all-weather tires impacting winter tire sales. (Most respondents said they believe winter tires make up less than 2% of the U.S. replacement passenger tire market.)

MTD: What new trends or technology are you seeing in the winter tire segment?

Brandon Stotsenburg, vice president of automotive division, American Kenda Rubber Co. Ltd.: e North American winter tire industry has been changing based on the recent di erences in the climate, with temperature and snow totals deviating from established norms from the last 50 years. It has also been in uenced by updates in

technologies which now allow all-season tires to match many of the characteristics necessary for most winter performance needs.

Kenda has a different approach for the United States and Canadian markets. In the U.S., Kenda believes most consumers will have their winter driving needs met by utilizing four-season (4S) tires o ering 3-Peak Mountain Snowflake (3PMS) certi cation. In most parts of the U.S., winter has lower temperatures with slush, enhanced rain and intermittent ice and snow. Kenda o ers its Vezda Touring 4S for small SUV and performance touring cars.

“Based on our estimates, winter tires make up around four million units of the U.S. retail replacement tire market annually,” says Karl Jin, divisional head, product and pricing, PCLT, Apollo Tyres Ltd.

In addition to the four-season products o ered in the U.S., Kenda will be o ering dedicated winter tires for the Canadian market that has more severe winter conditions and more need for those tires.

Karl Jin, divisional head, product and pricing, PCLT, Apollo Tyres Ltd. (Vredestein): Tire companies are continually working to improve winter tires by focusing on safety, tread wear, sustainability and driving experience. Some of the advancements in material research include advanced silane, bio-based oils, hydrocarbon resins, special types of silica and sustainable materials. Design-based technologies like 3D sipes and innovation in tread patterns are also being employed to enhance winter tire performance.

Photo: Continental Tire the Americas LLC

Photo: Apollo Tyres Ltd.

Winter tires

We do see smart technology/sensors in the commercial space today, but as an industry we’re still working to develop a compelling value proposition for this type of technology among consumer tires, including the winter segment.

Philipp Schrader, product manager for touring and U.S. winter tires, PLT, Continental Tire the Americas LLC: Sensor technology is certainly something we monitor closely. In the passenger and light truck segments, this will most likely be driven by OEM requirements moving forward.

Studdable tires continue to represent a significant, important portion of the snow tire market. Driven by consumer needs and regulations, the need for a premium studdable winter tire continues to be an important driver of new technology and tire design.

Ian McKenney, senior product manager, Bridgestone Americas Inc.: Since the 1980s when studded tires were outlawed in Japan and parts of the U.S., the winter tire industry has continued to focus on innovation in order to not compromise on performance when developing non-studded versions. Bridge stone has solidified itself at the forefront of winter tire innovation and our Blizzak tire line remains an industry leader today because of our specialized design technology.

Blizzaks feature Bridgestone’s patented Multicell Technology, which removes the thin layer of water from ice, allowing the rubber to grip the ice. This technology is comprised of next-generation compounds that feature silica enhancements, improving grip on snow and ice.

Lou Monico, vice president of sales, Giti Tire Canada: The winter tire industry is being influenced by smart technology, consumer preferences and the need to adapt to extreme weather events and changing climate patterns. The integration of sensors and smart technology in tires is a significant trend, along with a focus on improving fuel efficiency and traction to meet consumer demands and address environmental concerns.

“The new Goodyear Ultra Grip Performance 3 tire, available in fall 2024, features a directional tread pattern to disperse water and slush out the side of the tire to increase grip in wet and slushy conditions,” says Michiel Kramer, director of product marketing, Goodyear

Additional key features of the Blizzak line are its 3D zigzag sipes with block stiffness control. The interlocking sipes on the tire tread provide the biting edges needed for winter performance while maintaining the pattern’s stiffness. Its block stiffness control allows lateral stability and performance in snow, ice, wet and dry conditions.

We are currently investigating smart technology/sensors and their value across all tire segments. Developing this technology could assist in tracking things like tire pressure, temperature, tire revolutions, etc. However, at present, there isn’t a high level of demand for this type of technology among general consumers.

Michiel Kramer, director of product marketing, Goodyear Tire & Rubber Co.: The definition of what it means to be a winter tire has changed. Consumers are asking for more out of their winter tires and Goodyear is bringing new technology and innovation to the market in response. Consumer needs are less about the back woods, off-roading applications with deep, deep snow and more about handling and control during a wide variety of snowy, icy, slushy and even wet conditions that consumers meet between the mountains and their homes. The new Goodyear Ultra Grip Performance 3 tire, available in fall 2024, features a directional tread pattern to disperse water and slush out the side of the tire to increase grip in wet and slushy conditions.

Moonki Cho, product manager, Hankook Tire America Corp.: Studded tires have become more and more popular, especially in northern Europe, with over-run regulations. For optimal performance, studded tires with specific winter technology are expected to be on the horizon and introduced in the North American market. Smart technology has shown its strength for tire products across various segments, not only winter tires. Integrating sensors along with other tire systems allows further tire technological analysis and development, enabling continued opportunities to refine the segment and improve performance for drivers.

Jay Lee, product marketing manager, Nexen Tire America Inc.: In regards to eco-friendly materials, there’s a growing interest to develop winter tires using more environmentally friendly materials. Manufacturers are exploring ways to make sustainable alternatives when it comes to traditional tire components. On the subject of improved tread designs, ongoing research and development has enabled more efficient and effective tread patterns for winter tires. Those designs aim to improve traction on snow and ice, as well as enhance overall performance in cold conditions.

“Winter tires are designed specifically to handle the challenges of driving in the most dangerous months of the year and offer specific benefits for snow, slush and ice,” says Ian McKenney, senior product manager, Bridgestone Americas Inc.

Photo: Bridgestone Americas Inc.

“While the rise of all-weather tires may influence consumer choices, it’s unlikely that exclusive winter tires will disappear entirely in the foreseeable future,” says Jay Lee, product marketing manager, Nexen Tire Americas Inc.

Photo: Nexen Tire America Inc.

Tire & Rubber Co.

Photo: Goodyear Tire & Rubber Co.

Winter tires

Some manufacturers are even exploring the use of nanotechnology to enhance the properties of rubber compounds in winter tires. is can lead to improved grip, durability and overall performance in challenging winter conditions.

However, due to environmental concerns and regulations in some regions, there is a shi toward developing nonstudded winter tires. is is so tires can provide excellent traction on icy surfaces without the use of metal studs.

As for smart-tire technology, integration of smart technologies into winter tires — such as sensors that provide real-time information on tire pressure, temperature and road conditions — has been a trend. is helps to enhance safety and performance.

ere’s also a shi toward utilizing digital platforms and connectivity. Integrating features such as tire monitoring apps that provide real-time information about road conditions are becoming more common.

“In the U.S., Kenda believes most consumers will have their winter driving needs met by utilizing fourseason tires offering 3-Peak Mountain Snowfl ake certifi cation,” says Brandon Stotsenburg, vice president of automotive division, American Kenda Rubber

Steve Bourassa, director of products and pricing, Nokian Tyres Inc.: e industry’s advance from snow tires to winter tires was relevant then and even more important today as we match tires to the extreme weather variability we see today. Luckily, advances in material technology, modeling simulation and more have allowed us to build winter tires that can get better in ice grip, rolling resistance and wet grip in each generation. ese technologies create a more well-rounded winter tire to tackle today’s weather extremes and variable conditions.

Kyle Sanders, director of product marketing and category management for TBC Corp.: Winter tires are being embedded with radio-frequency identi cation (RFID) chips and sensors, which has numerous implications for vehicles. RFID tags can store helpful information like the tire make and size, making it easily identi able, further accelerating the trend toward automation.

MTD: What consumer preferences are in uencing the design and performance characteristics of winter tires?

Ian Coke, chief technical o cer, Pirelli Tire North America Inc.: e winter segment is in part following the same trend as the rest of the market in terms of electric vehicle (EV) rim size. EV vehicles — with all their particular requirements — also require winter tires in certain climates and this therefore leads to the use of low rolling resistance compounds, as well as noise cancellation foam able to operate and perform in low temperatures.

Jared Lynch, director of sales, PLT, Sailun Tire Americas: Sailun continuously focuses on innovating and improving (its) winter tire tread designs and compounds, so current generations of Sailun winter tires last longer while still delivering superior traction and handling on snow, ice and dry roads.

Smart technologies like tire pressure monitoring systems and forward-collision warning systems should increase safety for consumers, too. Paired with modern winter tire tread compounds and tread designs, these smart technologies will provide consumers with extremely reliable winter traction, handling and overall safety during winter driving.

Chris Tolbert, director of sales, Trimax Tire: Changes in air pressure, compounds, etc.

Stotsenburg (American Kenda): From a performance perspective, Kenda has done extensive research that determined consumers strongly prefer four-season tires that will allow them to have the same performance in the summer as they expect in the winter. When they learn they can have enhanced wet performance while maintaining strong dry braking and wear, many consumers across the U.S. were interested in those attributes.

For aesthetics, Kenda’s research determined that consumers strongly prefer a symmetric or asymmetric tread design over a directional design. Kenda has relied on our Technical Center’s proprietary capabilities to design tires which look like all-season grand touring tires with the enhanced performance.

e tires need to match the speed ratings required for year-round driving, while providing the wear and look that will satisfy the majority of consumers.

Jin (Apollo/Vredestein): Consumer preferences are driving the increasing demand for winter light truck tires and those featuring the ice rating symbol, which indicates superior performance in severe winter and icy conditions. is trend re ects the necessity for vehicles to be operational in heavy snow and challenging weather conditions,

“Given the ever-changing climate patterns, it is imperative for winter applications to ensure superior grip and signifi cant shorter stopping distances in all winter driving conditions,” says Kyle Sanders, director of product marketing and category management for TBC Corp. (Pictured, the Sailun Iceblazer WSTX, distributed by TBC.)

Co. Ltd.

Photo: American Kenda Rubber Co. Ltd.

Sailun says it continuously focuses on innovating and improving (its) winter tire tread designs and compounds, so current generations of Sailun winter tires last longer while still delivering enhanced traction and handling on snow, ice and dry roads.

Photo: Sailun Tire Americas

Photo: TBC Corp.

Winter tires

making it crucial to equip them with genuine winter tires to ensure optimal safety and performance.

To help consumers choose the right tire for their driving conditions, winter tires are marked with snow grip and ice grip markings.

Performance winter tires are marked with 3PMS, indicating they are designed and certi ed to perform in severe snow conditions.

Performance winter tires are preferred for temperature ranges from 10 degrees Celsius to minus-20 degrees Celsius.

Ice/snow winter tires are marked with 3PMS and ICE markings, indicating they are designed and certi ed for snow grip and ice grip.

ey are the right choice for drivers who may face extremely low temperatures (up to minus 40) and icy conditions.

“Consumer demand for enhanced tread life in their tires has infl uenced the development of new products, including our recently launched Winter i*cept iZ3 tire, now available for preorder,” says Moonki Cho, product manager, Hankook Tire America Corp.

e ective tread patterns that o er increased traction in ice, snow and wet road conditions.

Kramer (Goodyear): At Goodyear, we think through the various winter driving conditions and work to create tires to address those unique challenges to meet the needs of consumers. e deciding (of) which winter tire is right for (the customer) should include matching the tire’s capabilities with the type of winter weather (they) typically encounter.

Cho (Hankook): Today’s winter tires are typically designed with a V-shape tread pattern to meet the performance needs in snow and icy conditions. By also implementing wider lateral grooves, this enables better water displacement, as temperatures can fluctuate and increase standing water potentials throughout the season. is, along with consumer demand for enhanced tread life in their tires, has influenced the development of new products, including our recently launched Winter i*cept iZ3 tire, now available for preorder.

McKenney (Bridgestone): With the increasing prevalence of electric vehicles today, we expect to see winter tire design evolve to adhere to EVs’ speci c operating conditions in snowy and icy conditions. For example, since EVs are considerably heavier than ICE vehicles, that impacts driving characteristics like braking and turning. We can anticipate ongoing innovations aimed at reducing rolling resistance, preserving range, extending wear life and mitigating noise performance speci c to EVs and winter tires in the future.

Schrader (Continental): Snow and ice traction, along with braking capabilities in inclement weather, are certainly the top performance requirements for winter tires. Our compounding technologies continue to evolve to meet the needs of our customers in severe winter weather conditions. Along with compounding, we develop innovative and

Lee (Nexen): Consumer preferences play a crucial role in shaping the design and performance characteristics of winter tires. For example, consumers prioritize safety in winter-driving conditions. ey o en look for winter tires that perform well in a variety of winter conditions, including snow, ice, slush and wet roads. On the manufacturing side, manufacturers focus on developing tread patterns and compounds that enhance safety in winter weather. Versatility is a key consideration and tire designs aim to provide consistent performance across di erent surfaces.

Consumers also look for durability and longevity as they want value out of their winter tires. Key features like longer lifespan and improved wear resistance all contribute to better longevity and provide value over the life of the tire. Lastly, consumers demand a quiet and comfortable ride experience.

Bourassa (Nokian): Consumers are less likely to choose a product that works well in only one condition. Consumers want the ultimate safety and traction in the worst weather conditions, but are not willing to sacri ce the other days. ey want comfortable and quiet, with good dry grip, OE style and handling and good wet grip for safety on warmer/wet days.

“If I am buying a winter tire it is because I don’t want to compromise safety or performance,” says Ian Coke, chief technical offi cer, Pirelli Tire North America. “This means winter tires have been specifi cally designed to combat the challenges of cold, wet, snow and ice conditions.”

Coke (Pirelli): Speci cally for winter tires, it would be the performance attributes. If I am buying a winter tire, it is because I don’t want to compromise safety or performance. is means winter tires have been specifically designed to combat the challenges of cold, wet, snow and ice conditions (with) compounds designed to operate and maintain grip in cold and snow, (plus) tread design using 3D sipes, which maximize the gripping edge, as well lock in snow for extra grip.

Lynch (Sailun): New vehicles use larger rim diameters (18-inch) and lower-pro le tires when compared to previous models. While aesthetically pleasing, these larger wheels and lower pro le tires create a sti er, less comfortable and noisier ride. As a result, consumers want quieter and more comfortable winter tires, along with improved winter traction. When designing modern winter tires, comfort, noise levels, longevity and traction must all be prioritized.

Tolbert (Trimax): e growth of all-wheel drive vehicles, CUV, SUV and light duty trucks (and) continued evolution of compound changes, especially with the changes of weather patterns.

Sanders (TBC): Consumers expect improved acceleration, handling and braking of their vehicles in winter conditions.

Photo: Hankook Tire America Corp.

Photo: Pirelli Tire North America Inc.

Winter tires

Kevin Nguyen, manager of product planning, Yokohama Tire Corp.: Consumer preferences for winter tires have remained consistent. They are looking for tires that are designed specifically to confidently handle all types of winter conditions.

According to Chris Tolbert, director of sales at Trimax Tire, “winter tires won’t go away” and are “important for driving situations in Canada and parts of the northern United States.”

MTD: Do you think the rise of all-weather tires will impact the winter tire segment in the long term?

generally displacing the traditional touring/highway all-season tire more than any other tire category.

Dedicated winter tires will continue to have their place in the market, though, as they provide an even more robust solution for ice and snow in areas that get heavy winter weather. But for consumers in areas that see occasional light to moderate snow, 3-Peak Mountain Snowflake-rated all-season tires (or all-weather) products

Stotsenburg (American Kenda): Kenda considers four-season tires to be appropriate winter tires in most North American climates and geographies. We absolutely see these tires as a more appropriate solution for the reasons previously described. However, dedicated winter tires have a specific purpose and should be available across the markets for applications that require their enhanced performance. Kenda does not see them going away.

Jin (Apollo/Vredestein): In the last five years, there has been a shift in the tire market where all-weather tires have grown in demand, while winter tires have seen a decline. Although this trend might suggest that all-weather tires have replaced winter tires, it is not that simple. A closer look at the data shows that a significant volume of all-weather tires are also being sold in areas with little or no snowfall, such as California and Texas. So while it is true that all-weather tires have taken some of the market share from winter tires, this is not the complete story. Other factors, such as the amount of snowfall and when it occurs, can significantly impact the sales of winter tires.

McKenney (Bridgestone): Looking at data from 2019 to today, the percentage of winter tires sold has remained steady each year. However, 3-Peak Mountain Snowflake rated all-season tires are a growing trend. As technology has improved, there’s been a rapid adoption of these types of products by consumers. These tires are

Schrader (Continental): Some winter tire sales will surely transition to all-weather products, especially in areas of the country that receive less snowfall and increased wet weather days. The 45-degree rule should still be followed — meaning that winter tires remain more pliable below 45 degrees due to the rubber compound that we utilize. This leads to shorter stopping distances in cold weather, even on non-snow-covered road surfaces. We do not believe that winter tires will be replaced by all-weather products completely, since there is still a strong need for severe winter weather performance.

Monico (Giti): The rise of all-weather tires may impact the winter tire segment in the long term, as consumer preferences and technological advancements continue to shape the industry as demand has increased in this segment, especially in urban markets.

Kramer (Goodyear): The growing size of the all-weather tire market will never completely eclipse the need for winter tires. All-weather tire performance is improving, including some all-weather tires now carrying the 3PMS designation. An all-weather tire will never offer the full performance capabilities of a winter tire (on) deep, packed snow or extreme icy roads. The same can be said for an all-weather tire in summer and high-performance situations. Unless you have the right tire for the conditions you face, there will be trade-offs. In addition, regional needs and government regulations mean that there will always be a need for winter tires. Some all-weather tires carry the 3PMS designation, but are still marketed as yearround tires. All-weather tires with a 3PMS designation offer more snow traction than a traditional all-season tire and they are a great alternative for customers who are not

willing to own two sets of tires. However, for someone who regularly drives in harsh and unpredictable winter conditions, such as during a winter travel advisory, Goodyear would still highly encourage motorists to consider a dedicated set of winter tires.

Cho (Hankook): All-weather tires introduce added flexibility for consumers to find a product that best suits their driving environments. In some areas, such as the Northeast, consumers may find that an all-weather tire that has an all-season capability with more bias toward winter performance may better suit their needs over a dedicated winter product. That undoubtedly has an impact on winter tire segment demand and perhaps even more prominently on the all-season segment in some respects.

Therefore, the extent of all-weather tires’ influence on winter tire demand can vary, contingent upon factors such as consumer preference, local climate patterns and tire innovations. Winter tires will remain an important seasonal product, especially for regions that experience extreme levels of snowfall and ice. That said, there has been a trend of milder winter seasons in the U.S., like we’ve seen in the Northeast, that may have an adverse effect on winter tire sales.

David Carpenter, winter product category manager, Michelin North America Inc.: So far, we’ve seen stable winter tire sales with the introduction of the all-weather tires. We’ve seen the shift in volumes come from all-season tires, not winter tires. It is possible to see a slight decline (in winter tire sales), but we anticipate that customers seeking maximum winter traction will continue to

Photo: Trimax Tire

The Michelin X-Ice Snow tire features V-shaped tread design that provides 100% of its contact patch for optimal grip; Michelin’s Flex-Ice 2.0 tread compound for use in a wide range of winter temperatures; Michelin’s EverGrip technology; and more, say Michelin North America Inc. officials.

Photo: Michelin Tire North America Inc.

Winter tires

choose dedicated winter tires. All-weather tires are a great solution for those in mild winter climates, but severe winter conditions demand a dedicated winter tire that performs in sub-zero temperatures, deep snow and ice.

Lee (Nexen): The rise of all-weather tires does have the potential to impact the winter tire segment in the long term. All-weather tires are designed to provide a balance between the performance of summer and winter tires, making them suitable for a wide range of conditions throughout the year. As all-weather tires improve in technology and performance, some consumers may opt for these tires instead of dedicated winter tires, especially in regions with milder winter conditions. is could impact the demand for traditional winter tires.

However, in regions where winter tire usage is mandatory during speci c months, regulatory changes or exemptions for allweather tires could in uence consumer choices. If all-weather tires meet or exceed winter tire requirements, they may become a popular choice for compliance. It’s important to note that while all-weather tires o er convenience and versatility, there are still factors to consider, such as the severity of winter conditions in a particular region and the speci c needs of drivers. Dedicated winter tires o en provide superior performance

in extreme winter conditions and consumers who prioritize safety in harsh climates may continue to prefer them.

While the rise of all-weather tires may in uence consumer choices, it’s unlikely that exclusive winter tires will disappear entirely in the foreseeable future. There are several factors that contribute to this expectation:

Harsh winter conditions: In regions with harsh and prolonged winter conditions, there is a continued need for specialized winter tires that provide optimal traction, grip and performance in extreme cold, icy and snowy conditions.

Dedicated winter tires are speci cally designed to excel in these challenging environments and consumers in such regions are likely to continue prioritizing their use for safety reasons.

Performance: Exclusive winter tires are designed with a focus on winter-speci c performance. ey o en outperform all-weather tires in extremely cold temperatures and icy conditions. Consumers who prioritize superior winter performance are likely to continue choosing dedicated winter tires.

Consumer preferences: While all-weather tires offer convenience and versatility, consumer preferences vary. Some drivers

Winter tires for EV applications?

Tiremakers discuss what will be needed

“Electric vehicle (EV) drivers, like any driver, should use tires optimized for their driving conditions,” says Moonki Cho, product manager, Hankook Tire America Corp. “Winter tires are primarly focused on performance for driving on snow and ice.

“Therefore, the initial torque and heavy load of EVs greatly affect the grip of winter tires. So the use of EV-specific winter tires will help drive safety.”

“EVs can thrive in winter conditions,” says Hans Dyhrman, North American director of marketing, Nokian Tyres Inc. “Demanding winter conditions don’t change what EV drivers need, but make their needs even more important.

“Range is something many EV drivers obsess over, making low rolling resistance tires even more important for driving in the winter. Likewise, internal cabin noise is very important to the EV driver and the historically noisy winter tire .... needs to address this concern head-on.”

A spokesperson for Pirelli Tire North America says that EVs “will require the same level of performance attributes for winter tires as their all-season and summer counterparts, since EVs have similar characteristics, such as higher weight, battery range and instant torque.”

“As the technology behind all-weather tires has improved, it’s becoming a viable option for some consumers to make this choice instead of a winter tire,” says Steve Bourassa, director of products and pricing, Nokian Tyres Inc.

“However, consumers and tire dealers need to make sure they have an in-depth discussion about the limitations of all-weather tires and more limited winter performance.”

may prefer the optimized performance of winter tires in winter conditions and may be willing to make the seasonal switch to ensure maximum safety and performance.

Specialized features: Winter tires o en incorporate specialized features — such as advanced tread designs, siping patterns and rubber compounds — to provide the best possible performance in winter conditions. ese features may be challenging to replicate in an all-weather tire designed to cover a broader range of conditions. at said, market dynamics could evolve over time based on technological advancements, regulatory changes and shi s in consumer preferences. If all-weather tires continue to improve and provide comparable performance to dedicated winter tires, there might be a gradual shi in consumer choices.

Bourassa (Nokian): As the technology behind all-weather tires has improved, it’s becoming a viable option for some consumers to make this choice instead of a winter tire. However, consumers and tire dealers need to make sure they have an in-depth discussion about the limitations of all-weather tires and more limited winter performance, especially if they’ve driven winter tires.

All-weather tires are a viable option for consumers in many climates, but for true winter weather, a winter tire will continue to be the safest choice.

Coke, Pirelli: All-weather tires provide a truly balanced four-season tire for everyday use in most climates.

However, for those living in areas with prolonged cold/winter climates, winter tires are speci cally designed to deliver optimal performance in these more extreme conditions.

Photo: Nokian Tyres Inc.

Lynch (Sailun): When a product fits a specific market niche, it will often impact related categories. All-weather tires can appeal to consumers in regions with moderate, inconsistent winter conditions. However, dedicated winter tires remain the optimal choice for areas with persistent snow, ice, slush and cold (under 44 degrees Fahrenheit/7 degrees Celsius). Tire rubber compounds behave differently as temperatures drop.

While all-weather tires offer benefits like year-round use without seasonal changeovers, their performance is generally best suited for mild winter conditions. In harsh winter conditions, specialized winter tires are still ideal.

Winter tire sales may decrease slightly, but the majority of consumers that need the premium winter tire traction due to harsher winter climates will stay with true winter tires.

However, it is foreseeable in the areas that receive mild winters, many retailers may encourage their customers to venture into the ever increasingly popular all-weather tire category. This is where

there is a larger potential for all-weather tires to steal some winter tire market share.

Tolbert (Trimax): The recent winter weather has changed and is different and so are vehicle dynamics — more all-wheel drive vehicles, CUVs, SUVs and light duty trucks.

Hopefully for safety, it will get more

consumers to ride on a 3PMS-designated tire during winter driving conditions.

Not sure if they (winter tire sales) will decrease, but we do not see a huge growth or spike, (with) estimated single digit growth, most of it in larger diameter sizes (of) 18-inches to 21-inches. Winter tires won’t go away.

Nguyen (Yokohama): The current rise of all-weather tires will not impact the winter tire segment. All-weather tires (offer) a specific, versatile, single-tire solution, regardless of the season, for consumers who experience an occasional light snowfall. But if a consumer drives through snow throughout the winter season, then an exclusive winter tire is still the best option. The severe snow service rating identified by the 3PMS (designation) represents a test to meet a minimum level of traction in a specific scenario.

An exclusive winter tire typically far exceeds the winter performance of an allweather tire, still making them the ideal option for heavy winter drivers. ■

Kevin Nguyen, manager of product planning at Yokohama Tire Corp., says that consumer preferences for winter tires have remained consistent and Yokohama’s IceGuard line meets those preferences.

Photo: Yokohama Tire Corp.

Alternative financing

Why you should offer alternative financing

CONSUMERS ARE LOOKING FOR FLEXIBLE OPTIONS

Joy Kopcha By

Whether shopping for furniture, kitchen appliances or even shoes, consumers are given payment options. So when those same consumers enter your tire dealership and you present them an invoice, many are going to expect you to offer them more than just the option of “cash, check or credit card.”

Companies who offer consumer financing say those expectations are especially heightened in these days of higher prices and interest rates.

Three of those providers answered our questions and shared tips for how you should be marketing and talking to customers about these financing options: Kornerstone Living LLC, Snap Finance LLC and Synchrony LLC.

MTD: How have higher interest rates affected sales in the secondary financing market?

Jacob Knowles, sales and marketing manager, Kornerstone Living LLC:

We see a definite increase in customers looking for more financing options. For secondary financing companies, rising interest rates and higher defaults are leading them to increase charges and costs to dealers. We may have higher consumer demand, but many retailers are not willing to offer typical secondary financing due to the heavy discounts ranging from 8% or more.

In response to this, Kornerstone has introduced Prime10, a groundbreaking program that is free to dealers, requires no credit check and has no impact on their customers’ credit scores. Customers who qualify can enjoy the benefits of a nominal $50 monthly fee alongside their installment for every $1,000 financed with 10 months to pay.

Curtis Howse, executive vice president and CEO, home and auto, Synchrony LLC: There is no question that affordability for all purchases is front and center for all consumers. The trends that started in

early 2023 stemming from rising costs and interest rates have resulted in an increase in the number of consumers who are turning to financing options for services and auto parts, such as tires. Synchrony’s flexible financing solutions offered by our Synchrony Car Care merchant partners across the U.S. present consumers with multiple choices for monthly payment amounts depending on the size of their purchase.

Synchrony’s recent Major Purchase Study shows a 5% increase in individuals opting for financing for big-ticket purchases compared to two years ago. Our research also shows that flexible financing options remain highly favored among consumers across all age groups. The breadth of Synchrony’s products to help with these purchases extends from traditional private label revolving credit cards to dynamic installment loans.

MTD: What kind of messaging should tire dealers use to show consumers they have alternative funding options?

Rob Brown, head of research and insights at Snap Finance, says tire dealers should alert customers to their financing options “as soon as possible in the buying process.”

Photo: Snap Finance

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Alternative financing

Knowles (Kornerstone): No one likes to admit they don’t have enough to buy what they really want. It should always be ‘if you don’t want to pay the whole amount today, we have several financing options available.’ The message needs to be simple and transparent, with examples of payments and total cost for financing options. The customer experience includes not only great products and services, but also the completion of financing terms. If you want your customers to come back, they must have a great ‘whole’ experience.

The Prime10 message is simple: Get what you need now, pay later for a $50 monthly fee alongside your installment for every $1,000 financed. Take up to 10 months or pay in full anytime.

An example: A $1,000 set of tires paid in one month would be $1,050 or paid over 10 months would be $1,500.

Prime10 is the ideal option for customers who want to pay over 10 months at a reasonable rate without needing credit or having an impact on their credit.

Rob Brown, head of research and insights, Snap Finance LLC: Let shoppers know that financing is available as soon as possible in the buying process. Tire dealers can use attention-grabbing point-of-purchase materials typically provided by financing providers. Inform customers about available financing at various touchpoints, from driving by a store to browsing or waiting in line.

Sales teams should be well-versed in available financing options and able to easily walk customers through the application process. Let consumers know there may be financing options for them, even if they’ve been denied financing in the past. Ensure all communication is transparent and clearly explains how the financing works, what flexibility they have in paying it off and fully discloses all terms and conditions.

Howse (Synchrony): Messaging is critical for informing consumers of affordability options as early as possible in the purchase cycle. Tire dealers should emphasize and advertise convenience, flexibility, choice and accessibility in promoting financing options to consumers with phrases like ‘flexible payment plans’ and ‘affordable financing options,’ reassuring customers of choices. Synchrony’s enrolled merchant partners have access to the Synchrony Ad Wizard to take advantage of pre-designed

credit messaging for their store and website, while also having the ability to customize certain messaging with their logos or business names.

Beyond messaging, it is critical that dealers spend time training their employees on effective ways to introduce and discuss credit with consumers. Credit is not only a pivotal tool in helping consumers plan for meaningful purchases, but it is also an effective tool in closing complex and expensive sales. Synchrony’s Small Business Learning Center consolidates training and education for our small business partners and offers a wide array of resources on financing programs, digital tools, advertising support and more to help them to learn how to market our products to attract and retain new customers to grow their businesses.

Brown (Snap Finance): It can take years to recover from late or missed payments, bankruptcy or other items on a credit report. In the meantime, people with credit issues still need tires and wheels — and are often turned down for traditional financing. Secondary or tertiary financing can be a lifeline to those with lower credit scores, especially when their safety and ability to commute to work are at risk. Our research shows that 31% of consumers with credit scores below 670 could not have paid for their tires or wheels without financing.

Howse (Synchrony): The rising age of the average car in the U.S. means consumers will continue to pursue maintenance and repair options for longer. These costs continue to climb for a number of reasons and there is no consensus on when they

In response to higher interest rates and defaults, Kornerstone has unveiled a new financing program called Prime10, which tacks on a $50 monthly fee for every $1,000 financed over a 10-month payment period.

MTD: In the tire and automotive service space, why is it important that tire dealers offer secondary financing?

Knowles (Kornerstone): We have seen the highest increase in tire prices in recent years and auto repair costs have increased even higher. With Americans driving their cars longer, these increased costs are unexpected and unmanageable for many consumers with low or no credit.

will stabilize. Consumers are expecting merchants to provide them with options across the entirety of the purchase cycle. Financing is at the top of that list. Offering flexible financing solutions is crucial for tire dealers to expand their customer reach to those who may need affordable payment plans or promotional financing to pay for the products and services they want and need. By making services more accessible through a variety of financing options,

Photo: Kornerstone Living

auto repair (shops) and tire dealers can boost sales and stand out in a competitive market. Additionally, offering financing helps foster customer loyalty by providing convenience and flexibility, which can lead to repeat business and positive wordof-mouth referrals. Synchrony believes in building long-term relationships with our cardholders, dealers and partners. We’ve demonstrated this in our over 85 years of providing consumer financing in the U.S. Ensuring dealers have access to well-understood and accessible financing and payment solutions while providing customers with the means to afford necessary automotive services is a vital piece of strengthening that relationship.

MTD: How many secondary financing customers become repeat/return customers?

Knowles (Kornerstone): Well over half of the customers who set up payment programs return to do so.

Brown (Snap Finance): Relationships matter when you’re building loyalty with customers, especially those who are often turned away because of their credit history. Our research shows that 77% of consumers with credit scores below 670 said a positive previous experience was important to them as they decide where to buy new tires or wheels. Customers remember when a business can help them get what they need.

MTD: What does the data show for average ticket price in the automotive/tire market?

Knowles (Kornerstone): For auto repairs, we see an average of $2,000 invoices with many at $4,000 or more. For tire retailers, we see an average of $1,200.

Brown (Snap Finance): We know that when financing is available, customers can upgrade their purchase or get more of what they need. Our research shows that on a recent purchase, 58% of those with credit scores below 670 spent more because financing was available.

MTD: Do consumers usually purchase four tires rather than two or do they tack on automotive services to a tire purchase when using secondary financing?

Knowles (Kornerstone): With a reliable alternative finance option, we have observed that customers are inclined towards purchasing higher quality sets of four tires. This is especially true for all-wheel-drive vehicles, as they often necessitate the replacement of all four tires simultaneously. As a result, customers are actively seeking assistance in spreading out the costs associated with this essential purchase.

Brown (Snap Finance): With financing, more shoppers can get more of what they want or need and retailers can increase their average order volume. Our research shows that on a recent purchase, 58% of those with credit scores below 670 spent more because financing was available. And among those who spent more, 79% increased their purchase by $100 or more. ■

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Maintaining brakes, rather than fixing them

TIRE DEALERS ADAPT TO MEET DEMANDS

By

FJoy Kopcha

orty-two years ago, when Kevin Walsh reported for his first day of work at Weymouth, Mass.-based Mass Tire and Auto Service, tires and brake jobs were on the menu. In the four-plus decades that have passed, tires and brakes have remained an essential element of the business’ service offerings.

But when it comes to brakes and the automotive service category overall, Walsh says one thing has changed.

“Cars used to break and that’s what was the driving factor to (customers bringing) vehicles into this building for so many years. But cars don’t break down anymore. Cars need to be maintained — and there’s a difference.”

As part of every service ticket, Walsh says Mass Tire and Auto Service’s courtesy inspection includes the measurement and notation of a vehicle’s brake wear. And the dealership translates the results so customers can understand: if there’s 30,000 miles on the vehicle and the brakes are 75% worn, the customer can expect to need new brakes within the next 10,000 miles.

Walsh says that information helps customers plan for the future. But it also sometimes results in a sale that’s ahead of schedule. “Some will say, ‘I know it’s a little early, but I want to get that taken care of and have it done.’”

That predictive and preventive mindset is completely different than what he recalls from his early days on the job.

“We never identified that,” says Walsh. “We waited for the brakes to fail and vehicles were towed in left and right. That’s the evolution in this business.”

Mass Tire and Auto Service is a singlestore tire dealership with 12 service bays and is open six days a week.

Walsh says the company’s sales break down evenly across three categories: onethird is tires, another third is labor and the final piece is parts. His goal is to continue to increase the store’s tire business as a

larger portion of overall sales — without sacrificing anything in labor or parts.

Over the years, Walsh moved up from working in the dealership’s service bays to becoming its owner. He says customers count on his business to take care of what their vehicles need today and what service may be needed down the road.

“We’re not trying to sell them anything additional.” He compares his line of work to that of a server at a restaurant who asks if you want dessert after the main meal. “Yeah, she’s trying to sell you a little something, but it’s not a derogatory statement. Our customers expect us to portray for them what their needs are today (and) next month and what the horizon looks like.”

Taking care of customers also means providing them with quality parts. That’s why Walsh says even though the good-betterbest model may work for tires, it’s not a tactic his team uses in brake service.

Mass Tire and Auto Service doesn’t advertise, but utilizes this changeable sign to share messages and a bit of personality with customers who drive by. Others see the witty messages when they’re shared on the store’s social media channels. One of those posts went viral and was viewed 1.9 million times over a five-week span.

With two locations along the coast of Maine, Eastern Tire & Auto Service’s business breaks down to a 60-40 split of automotive service and tires. Of that 60% service, President Alvin Chase says brake jobs represented almost 19% of the business in 2023.

For a small price increase, “you can put on a product that’s going to last a lot longer. We rarely will sell an economy brake part. It’s just not worth it.”

Farther north in New England, Alvin Chase and the team at Eastern Tire & Auto Service Inc. in Maine are suddenly doing a lot more brake work than they were a year ago, but that’s because the 78-year-old business opened its second location in Rockport, Maine last year.

Chase, president of the employeeowned dealership, says the expansion was needed to meet growing demand.

Over the span of about two years, Chase says six or seven independent repair facilities in Knox County closed, and that “put a crunch” on the remaining service providers. For a while, he says, there was “a three- or four-week wait to get any kind of automotive service,” whether at independent shops or at local car dealerships.

“Our sweet spot for years has been to service (the customer’s) needs, and if it’s a day or two (wait), that’s acceptable. But to wait a week, 10 days or heaven forbid, three weeks is just not where we want to be.”

So when another independent shop owner in nearby Rockport was looking to retire and couldn’t find any buyers, Eastern Tire & Auto Service made an offer to purchase the business last year.

The dealership purchased the store in mid-August and reopened the seven-bay store in September.

“This gave us the ability to double our capacity,” says Chase. And the dealership was able to return to its norm of offering same-day and next-day service. ■

Photo: Eastern Tire & Auto Service

Photo: Mass Tire and Auto Service

By

IDennis McCarron

The daunting role of service managers

BALANCING SPEED, ACCURACY AND PERSONNEL IS ESSENTIAL

’ve long stated that service managers have the hardest job in an independent tire dealership. Store managers have moments when their job is hard. Service managers are always juggling.

One of the hardest things a service manager has to be good at is balancing speed and accuracy. Yes you want to get a job done quickly, but not to the detriment of doing it right. Customers seem to prioritize speed, but if you ask them, they also want the job done correctly.

A service manager is like a conductor. He or she must keep all the instruments in time, otherwise the music is disorganized. The service manager has to juggle the due time of every ticket and who gets the ticket.

This should be based primarily on who is capable of doing the job correctly and on time. There is a time to stretch a technician’s experience and have them learn.

But in order for an adult to learn, there cannot be pressure to do it. The person will have a hard time learning if there are distractions.

Service managers need to have a feel for the shop, as well. Who is on fire today? Who is a little slow? What are the upcoming appointments?

Getting the shop into the right rhythm and keeping it there is an everyday battle.

Learning to give who what — and when — is a skill that can only be developed through practice and repetition.

Owners or store managers should have regular conversations about the decision-making methods the service manager goes through in assigning work.

There should be parallels in both people’s minds about how work flows through the shop.

In addition, service managers must communicate continuously and effectively with not only technicians, but service advisors.

One bad service advisor is all it’s going to take to throw a grenade in your shop.

If a service advisor is agreeing with a customer that an oil change will only take 15 minutes and the shop is full and three deep on every tech, the service manager needs to hand the ticket back to the advisor and tell them they must renegotiate the time due.

A good service manager also has a timer in his or her head keeping track of the work in progress.

How long are parts going to take to get here, when does the tech actually start the work and how long will it take at that point? If the service manager simply hands out tickets and orders parts, then your shop is going to be a mess real quick.

This timer can be going on 15 different tickets at a time, so

it’s not an easy thing to do. And let’s not forget keeping up on returns and any parts inventory that needs reordering.

Lack of communication is the single most common mistake I see in tire dealerships across the country.

The ticket is handed to the service manager, who reads the ticket with very little communication from the advisor and then puts the ticket on a technician’s hook or bin.

The technician then comes over and reads the ticket, but very little communication happens then, as well, unless there’s a problem.

Both of those situations should include brief conversations, whether simply stating a due time or offering an explanation of any specific requests by the customer. There must be verbal communication at every point whenever a ticket changes hands.

'Service managers also need to be diplomats. They have to bridge the gap between Counter Country and the Nation of Technicians.'

I can promise you this: if a shop is quiet on the communication front, it’s going to have problems, which will be a surprise, and that will take up more time correcting than a 15-second conversation a couple of times over the life of the ticket.

Finally, service managers also need to be diplomats.

They have to bridge the gap between Counter Country and the Nation of Technicians. There’s a built-in tension between the two.

One is trying to make customers happy and agree to their demands and the other is trying to do the job the right way. Sometimes this can create friction and it’s up to the service manager to find middle ground and smooth out the rough patches.

The job of a service manager is simple, but it’s far from easy.

If you’ve ever done the job, you know you walk 20 miles a day inside the shop and your brain hurts at the end of it.

It’s physically and mentally demanding and that should be the motivation of the service leader: to provide a challenging yet rewarding experience. ■

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

By

Randy O’Connor

You’re responsible for training, culture at your dealership

NEITHER ARE SIMPLE, EASY NOR CHEAP TO DEVELOP

Though long overdue, there’s been a solid push throughout our industry to step up to the plate as it pertains to compensating the team members who deliver our customers’ service.

Whether by intentional design or market necessity, the industry has finally recognized the fact that some staffing struggles are self-imposed.

While fairly compensating our team members has always been — and likely will always be — a significant determinant of each dealership’s success or lack thereof, there are two significant topics that technicians find to be just as, if not more, important than compensation: training and culture.

But let’s address compensation first. It wasn’t so long ago that a $100,000 job was a really big thing. That was when college graduates were entering the market at $35,000 to $40,000 a year.

Today, meeting basic human needs exceeds the four-year degree, entry-level salary of just a decade or so ago. Take that big step to a six figure income and add another couple flights of stairs to get there. That benchmark is now more like $125,000, if not more.

To be brief, the bare minimum take-home pay necessary to survive, in most areas, is $3,000 per month. That puts bare minimum, annual gross pay at just over $40,000. Hopefully your entry level, full-time compensation at least meets that threshold, with the ability to earn 10% more on a production basis.

So back to the two heavy-hitting topics previously mentioned. When we think about both training and culture, we tend to think of programs.

What’s your technician training program like? Is your sales program effective? What programs do you have in place to improve workplace satisfaction? Which employee benefit programs do your employees like the most?

What I find interesting and notable here is that dealers with mature training programs and healthy/supportive culture almost always do both well.

It’s rare that we find a business that has great culture, but lousy training, and vice versa. Why is that? It’s because both are dependent on the other.

That said, just because you have a solid training program does not mean you have healthy culture. So what’s the difference?

Training doesn’t necessarily satisfy the need for learning. In other words, just because you have training programs available to your vehicle service and customer service team members doesn’t mean you have a learning culture.

A learning culture encourages, celebrates and rewards consistent learning. A learning culture facilitates learning both within and outside the workplace and the entire organization is engaged.

In these cultures, team members feel valued, engaged and will stay with you longer because they know leadership is genuinely interested in their growth and development.

Culture, said simply, is complex. It’s the way of life that is shared within and among your organization and teams. This comes from your business’ stated mission, leadership, goals, core values and collaboration, as well as the inclusivity that exists both within and as an extension of your workplace, among other things.

‘The responsibility for developing training and culture is squarely on your shoulders.’

A positive work culture doesn’t happen by chance.

It takes thoughtful and careful planning over a significant period of time. If you aren’t regularly thinking about your company’s culture as an owner, chances are your culture isn’t where it needs to be. There’s a large price to pay for falling culturally short.

On the flip side, a healthy culture leads to a growth mentality with increased productivity and financial success for both your organization and team members.

Let’s be honest with each other. The tire and auto service industry, as a whole, could do a much better job of investing in training and culture.

If you were to ask 100 shop owners what their training budget is and what specific steps they have planned to improve workplace culture in 2024, I’d bet less than 10% can give you a solid response.

And those who can give a response are likely not budgeting nearly enough to have cultures that are adolescent, let alone mature. It’s time we get real and really serious about both.

The responsibility for developing training and culture is squarely on your shoulders. Neither are simple, easy nor cheap to develop.

Though training and culture are extremely complex, they’re the basic building blocks foundational to every organization. They have been — and will always be — one of the leading indicators of your current and future success. ■

Tire and auto industry veteran Randy O’Connor is the Owner/Principal of D2D Development Group (Dealer to Dealer Development Group.) He can be reached at randy@d2ddevelopmentgroup.com. For more information, please visit www.d2ddevelopmentgroup.com.

By

IReasons why M&A deals died in 2023

HALF WERE FINANCIAL AND HALF WEREN’T

Michael McGregor

’ve always wanted to write a column about all of the reasons that deals die. It’s helpful for tire dealers to know what some of the pitfalls might be before they start their business exit planning. But since I’m only involved in so many transactions, it would only be one guy’s opinion.

So I was pleased when Axial recently published their “Dead Deal Report: Unpacking 2023’s Broken LOI’s” report.

Axial is a private deal network that covers the lower middle market in the United States and Canada. (Full disclosure, my firm, Focus Investment Banking, was just ranked No. 1 in Axial’s Top 25 Investment Banks for 2023 list.)

Axial’s definition of lower middle market is private companies with revenues between $2.5 million and $250 million. Most tire dealers and automotive businesses that that I run across fall within this range.

Axial investigated 47 transactions across a variety of industries — transportation company deals were 11% of them — in which a letter of intent to purchase was signed by a buyer and seller, but for some reason, the deal did not close.

Since we find that private companies in the lower middle market have more similarities than differences, regardless of industry, there are things here that tire dealers can learn from.

It’s first interesting to see who the buyers in the lower middle market are. Thirty percent of the buyers were independent sponsors — think private equity that finds capital on a deal-by-deal basis — without a committed pool of money; 19% were strategic acquirers of various sorts; 19% were search funds — vehicles for aspiring entrepreneurs to find and buy a company; 17% were private equity funds with committed capital; 6% were family offices backed by a wealthy family; and 9% were individual investors bidding on the smallest deals.

The math is that 49% of the deals died for financial reasons and 51% died for non-financial reasons.

Nineteen percent of the deals died because the deal couldn’t get financed. With higher interest rates, the same cash flow of years past now supports a lower amount of balance sheet debt. That may kill a high-priced deal. Also buyers like to use mezzanine and senior bank debt. Sometimes these lenders choose to not invest in a certain industry — like oil and gas, for example — when oil prices are past peak. The equity check writer will walk away in these cases because they can’t make the return on equity that they seek without the debt.

Seventeen percent of deals died because the quality of earnings (QoE) report typically funded by the buyer came back with substantially lower EBITDA. There is a simple way to avoid this. Where it makes sense, we recommend that our clients get their own independent, sell-side QoE before going to market. This avoids surprises, helps firm up the valuation from a buyer, assists with

working capital negotiations and leads to a smoother financial due diligence process.

Next, 12.8% of deals died because there was a valuation misalignment between a buyer and a seller. There are two numbers in most valuations: the multiple the buyer is willing to pay and the EBITDA. We try to pin down the multiple so that there is only the EBITDA variable left. But that variable is often a moving target and it’s only good when it has been heading upwards both in the last twelve months (LTM) and the next twelve months (NTM). I always recommend new sales incentives and profit bonuses to keep the numbers headed in the right direction.

At 17.1%, the largest non-financial reason for deals dying was that the “seller backed out.” Transactions can be emotionally draining and stressful. And in family-run businesses, multiple generations are often at odds on the best option. Due diligence also can frustrate sellers who don’t understand that buyers have fiduciary duties to their investors to carefully review investments. Sellers can take repeated requests and multiple ways the same questions are asked in the wrong way. We do a lot of handholding and talking sellers off of cliffs in our business.

'It’s helpful for tire dealers to know what some of the pitfalls might be before they start their business exit planning.'

Another 17% of deals died for non-financial reasons discovered in due diligence. Private companies are risky investments and buyers walk away if the perceived risk is too high. The best way to avoid this is to not lie. Be transparent about the challenges your business faces. It makes a buyer more comfortable with you and they’ll look for solutions to your issues instead of walking away.

The last category is the catch-all “other” at 17%. In the Axial report, this was anything from the buyer having too many deals going on at once and killing the least attractive one; the deal committee killing the deal when it was brought to them for final approval; or one of the acquisition partners backing out of the deal. All three have happened to me before. The only solution is to ask a lot of questions before picking the right buyer and doing some diligence on them. ■

Michael McGregor is a partner at Focus Investment Banking LLC (focusbankers.com/automotive/tire-and-service). He advises and assists multi-location tire dealers on mergers and acquisitions. For more information, contact him at michael.mcgregor@focusbankers.com.

By

IFree coffee, free EV charging

ARE THEY WORTH IT?

Craig Van Batenburg

ran a shop for more than 25 years. We served good coffee.

But as coffee prices would rise, I sometimes wondered if it was worth it. Maybe we should have provided cheaper, less strong coffee? I never did any of that.

Some years we had an abundance of cash and other years the Christmas bonus was not what I would have liked. The question was, “How much do I give away?”

When modern, plug-in electric vehicles (EVs) went on sale nationwide in December 2010 — other than Tesla and the California experiment of the 1990s — you could buy a Chevy Volt or a Nissan Leaf.

One was an EV with a gas engine as a backup and the other was a pure electric car. My company, Automotive Career Development Center (ACDC), bought both.

Slowly, technicians from all over the world would come to Worcester, Mass., where ACDC is located, to learn about these two models. Early on, most shops where these techs worked installed level II destination chargers, with 240 volts supplying about 16 amps, adding 10 miles of range per hour.

At 20 cents per kilowatt delivered to their shops, the average EV charge that took an hour or two would cost about a buck. A cup of good coffee with cream and sugar costs about the same. So does a cheap pen, two for a dollar, with your name on it. You get the point here.

I have been writing for MTD for well over a year and the interest in this column has been very good. Why? To make good decisions, you need information.

Facts are the basis for all future planning.

When I did a class on management last year, I refreshed the definition of “What is the business owner’s function?”

I decided that in any business, the final decision-maker’s job is to “make stuff up and be right most of the time.”

It got a laugh, but I think it also fits these times, when EVs are disrupting the usual slow-moving pace of technology used in motor vehicles.

The original equipment car manufacturers have invested billions of dollars in EVs and they want that investment to pay off. You are no different, but your investment is a lot lower.

If you already have a Level II or DC fast charger at your shop, you are ahead of the curve.

If you can spare five minutes, email me using the contact information at the bottom of this column with what you have learned about this subject. I am always learning.

If you want to consider offering EV charging at your dealership, here are a few things to know.

The product you are buying — both level I (120 volts AC) and level II (240 volts AC) — are technically called electric vehicle supply equipment (EVSE).

These chargers supply alternating current electricity and the battery in the car produces direct current (DC) electricity. In between the EVSE and the vehicle is a charger, located in the vehicle, to change AC to DC.

EVSE is commonly called a “charging station.” EVSE systems at the level II size come in different current outputs, shown as “amps” on the product description.

Simply put, provide more amps and the customer’s vehicle will charge faster.

EVSE equipment can also be classified as a DC Fast Charger (400 to 800 volts DC). That type is expensive and requires more power to operate than most shops have onsite.

As you consider offering EV charging at your dealership, here are some questions to ponder:

• Is there convenient charging close to your shop? If so, you may not need to do anything.

• Do you want to offer charging for free, as a courtesy? Some shops do.

• If charging is free, will you shut it off when you are closed? Some shops do that, but it may backfire and annoy people.

• Will this just be for your customers or will it be for the general public?

• Do you think this will attract new customers?

• How fast do you need to charge a vehicle?

• Do you have extra power in your fuse box to handle it?

• Can you afford to tie up a parking spot or two?

In addition, is there some money available from your city, state, federal government, utility provider or another entity to help fund it? This web site will help answer that question. Click on your state. https://afdc.energy.gov/fuels/electricity.html

Also remember that there are indoor and outdoor charging units and they can come with credit card readers.

If you work on plug-in vehicles, your techs will need the EVSE inside the shop to test vehicles that are not charging properly. (Level I is always portable. Level II can be portable.)

Contrary to what you may have recently read, EV sales are still very good. Taking the long view has helped my companies always stay ahead of the competition. Will your investments in EVs pay off? Only you can answer that question. I am here to help you arrive at an answer. It’s your answer — not mine. ■

Craig Van Batenburg is the CEO of Van Batenburg’s Garage Inc., dba Automotive Career Development Center (ACDC), which is based in Worcester, Mass. A 50-year automotive service industry veteran, Van Batenburg provides training for facilities that service — or want to service — electric and hybrid vehicles. For more information, see www.fixhybrid.com or email him at craig@fixhybrid.com.

YO U R B E S T M OV E

T h e r i g h t m ov e c a n m a k e a l l t h e d i f f e r e n c e a n d w i t h t h e a l l - n ew

A M E R I CUS R E CO N T OU R , y o u c a n c h e c k m a t e t h e c o m p e t i t i o n w i t h a t i r e t h a t d e l i v e r s e x c e p t i o n a l v a l u e a n d p e r f o r m a n c e a c r o s s t h e b o a r d

“We want to make sure we’re focused on our customers and trying to be the leading and most trusted provider of tires to them,” Cheryl Gossard, president of K&M Tire Inc., told MTD.

Photo: MTD

“K&M puts on a great show,” said Kent Schuler, who owns Dewey’s Tire Repair in Platteville, Wis. “It gives us a chance to talk to other dealers.” (Kent, right, is pictured with his father and Dewey’s Tire Repair Co-owner Duane Schuler.)

More than 800 guests attended K&M Tire’s 2024 Dealer Conference and Trade Show, the first K&M dealer event held on the East Coast. The two-day conference took place in Atlantic City, N.J.

K&M Tire ‘levels up’ distribution, customer service

OTHER ENHANCEMENTS ARE ON THE WAY, SAYS GOSSARD

By

Mike Manges

K&M Tire Inc. is leveling up its distribution footprint and customer service capabilities as the company expands into new markets.

“Every year, we try to get a little bit better, (while) making sure we’re taking care of our customers,” Cheryl Gossard, president of the Delphos, Ohio-based distributor, told MTD during the company’s recent Dealer Conference and Trade Show in Atlantic City, N.J.

The event, K&M Tire’s first on the East Coast, drew more than 800 attendees from all over the United States.

Gossard told MTD that K&M Tire expects to sign more customers in the western part of the country thanks to its recent acquisition of Point S USA’s

41,000-square-foot distribution center in Denver, Colo., a market that “we were growing toward out of our Kansas and Nebraska locations.”

As part of the deal, which was announced in November 2023, Point S also will use K&M Tire as its primary tire supplier in Colorado.

“We think we can begin signing new customers in the Denver area” and beyond, Gossard told MTD. “That’s what we’re looking to do.”

Meanwhile, K&M Tire continues to beef up its distribution capabilities in other markets.

The company opened a distribution center in Carlsbad, N.M., in January 2023.

In Minneapolis, Minn., it moved from

an 80,000-square-foot warehouse to a 180,000-square-foot distribution center.

“We just moved our warehouse in the Cleveland, Ohio, area,” said Gossard.

“That was a 30,000-square-foot (facility) and we moved to a 120,000-square-foot building.”

And K&M Tire moved to a larger distribution center in Wichita, Kan., “a few weeks ago. We went from 70,000 square feet to 120,000 square feet.”

Commenting on its inventory levels, K&M Tire is currently “in a good place” and is in “a much better spot” than it was 12 months ago, Gossard noted. “We know what to focus on.”

K&M Tire continues to invest in customer-facing personnel.

Photo: MTD

Photo: MTD

“We’ve added regional program managers, or RPMs, who are on the outside, calling on dealers.”

In the past, this duty fell on “regional sales managers or outside salespeople and we expected them to be the experts on all (vendor) programs,” as well as K&M Tire’s in-house Mr. Tire associate dealer program.

“Now we have three RPMs in different regions who can help.”

There’s no substitute for face-to-face interactions with existing and potential customers, according to Gossard.

“There’s a lot of competition out there and we want to make sure our dealers know we’re here to support them and want them to be successful.

“If we can’t be there face-to-face, we can’t really see what’s going on, so it’s hard for us to make suggestions.”

To help ensure that its customers continue to receive the right products at the right time, K&M Tire is researching supply chain software that when implemented, will make the inventory management “less

manual and more automated, so we can react more quickly.”

Once K&M Tire decides on a system, deployment will likely take “several months and hopefully by the summer, (customers) will see it’s made a difference,” said Gossard.

K&M Tire also has rolled out “a huge enhancement” to its Weblink system that customers use to order tires and view inventory levels.

“We’ve been working on that for quite a while. Now they can look up staggered fitments and if a tire’s coming from another location,” customers can see the date and time of delivery.

“If they’re on a program with us — whether it’s a vendor program or our Mr. Tire program — there’s a page that shows where they’re tracking for the quarter and year. All of our vendors have websites where (customers) can go and see that, but this is the one place where they can see everything.”

Another big push for K&M Tire in 2024 will be “leveling up all of our internal

departments,” Gossard told MTD. “We want to make sure we’re taking care of our employees.

“Around the first of the year, we announced some additional PTO levels. We increased our tuition reimbursement.

“We’re also doing what we call ‘K&M On the Road,’ where we have a truck and a trailer” that’s equipped with various amenities.

“There’s a core group of us who will visit K&M locations. We’re grilling hamburgers and hot dogs, we’re handing out some door prizes and other gifts — just spending time with (employees) to make sure they understand that we appreciate what they do.”

The K&M On the Road truck and trailer visited four locations in Texas in January.

Gossard told MTD that K&M Tire “had a really good year” in 2023 and expects more of the same in 2024.

“We want to make sure we’re focused on our customers and trying to be the leading and most trusted provider of tires to them,” she said.

Black’s Tire stays true to core values

‘WE WANT TO SET THE PACE’

By

Mike Manges

As it starts its 95th year in business, Black’s Tire Service Inc. is sticking with what has made it successful: treating employees and customers like family.

That was a key theme of the Whiteville, N.C.-based dealership’s annual Sales and Leadership Conference, which took place in Myrtle Beach, S.C.

More than 600 people — including 300-plus Black’s Tire’s Service employees — attended the multi-day event, which, according to Rick Benton, who directs BTS Tire & Wheel Distributors, the dealership’s wholesale business, was “really about driving our culture — focusing on what got us here and what’s going to keep us going. It’s kind of like a family reunion.”

“We didn’t talk a whole lot of numbers” at the event, Rick told MTD. “We focused on our core values of family, team, trust and service,” which he said Black’s Tire Service employees will take back to their respective stores and functions.

“When a customer walks into a store, we want them to feel like family,” he said. “Our wholesale customers — we want them to feel like family.”

“We talk about how much stronger we are together,” said Ryan Benton, who manages Black’s Tire Service’s retail business. “We try to live by the golden rule and you feel that way when you walk into one of our stores. It’s not a stale atmosphere.

“Our managers — the face of our company — care about the customer,” which is a theme that Rick and Ryan — along with their brother, Jeremy Benton, who runs Black’s Tire Service’s commercial tire business — emphasize when working with all of their dealership’s associates.

“We talk about doing the right thing and empowering our managers and their people to make decisions, while doing it with the right values,” said Ryan.

ALWAYS GROWING

Black’s Tire Service, which was founded by W. Crowell Black, continues to add locations, including three in January 2024.

Jeremy, Ryan and Rick’s father, Ricky Benton Sr., joined Black’s Tire Service in 1981 after running his own service station. He later bought Black’s Tire Service from its founder. Since then, under his direction, the dealership has expanded to nearly 60 locations, making it the 19th largest independent tire dealership in the United States, according to the 2023 MTD 100.

Much of that growth has been driven via strategic acquisitions, though the Benton family hates to use what Ryan half-jokingly calls “the ‘A word.’ We’ve never done an acquisition. We’ve merged other families into our business,” with many former owners continuing to work with the Bentons.

“Some of the companies we’ve merged with were better at certain things than we were,” he told MTD. “We’ve learned as much from them as they’ve learned from us.”

“We’re big relationship people and opportunities come up through these relationships,” including the connections Black’s Tire Service cultivates with its wholesale customers, many of whom are small independent tire dealers, said Rick.

“They’re no different from us, except that they might not have as much family in the business. But they care about their customers. They care about their team members. They care about their name. And they want to see it carry on.

“It goes back to what you build your foundation on,” he continued. “It can’t just be on the almighty dollar. That’s where relationships and being close to people come in.”

Jeremy noted that Black’s Tire Service was founded at the beginning of The Great Depression and has survived countless up-and-down cycles by staying true to its core values.

“I’d say we’ve done as good of a job as any” when it comes to weathering economic storms.

There are a number of market dynamics — including the high average age of customers’ vehicles — that benefit the dealership, according to the Benton brothers.

“Auto service has been very successful for us,” said Rick, and the company’s Carolina Retread business, which Jeremy directs, remains a consistent bright spot for the company.

The dealership also has managed to maintain its margins, despite everincreasing pressure.

“We’re going to keep finding ways to provide better service to the public and ways to make Black’s Tire a better place to work,” added Ryan.

And that will be pushed through by “getting people even more excited and more engaged with our vision,” said Rick.

“We’re swimming with some big competitors,” said Jeremy. “We want to not only survive — we want to set the pace.”

“We don’t answer to stockholders,” said Rick Benton (pictured far right, with Jeremy Benton, center, and Ryan Benton, far left.) “We don’t answer to a panel. We care about people and can put customers first.”

Photo: MTD

WTD plans for ‘substantial growth’

EXPANDING

DISTRIBUTION, PRODUCT RANGE ARE BIG PRIORITIES

Investments made by Wholesale Tire Distributors (WTD) are “all geared toward enhancing our service and making our brands easily accessible to our valued customers,” says Vahe Tchaghlassian, WTD’s vice president of operations and marketing, pictured here at the 2023 SEMA Show.

Los Angeles, Calif.-based Wholesale Tire Distributors (WTD) has ambitious plans to expand beyond its current distribution footprint.

The company’s consolidation of three warehouses in southern California into one distribution center last year was a significant step.

WTD’s 300,000-square-foot distribution center in Pomona, Calif., which opened in June 2023, is now fully operational, says Vahe Tchaghlassian, WTD’s vice president of operations and marketing and co-owner of the company with his father and WTD founder, Ara Tchaghlassian.

The facility “has scaled our ability to supply our current customer demands significantly,” says Vahe, adding that “it’s much easier to be under one roof.”

The Pomona warehouse is WTD’s third distribution center.

The company also has warehouses in Calloway County, Ky., and Latrobe, Pa., both of which carry a substantial number of units.

“The benefit of having the Pennsylvania and Kentucky warehouses comes in when customers can’t wait for containers to come from the factory.

“They can place fill-in orders,” which are delivered by truck. “It’s all geared toward enhancing our service and making our brands easily accessible.”

MORE TIRES, MORE OPTIONS

In addition to investing in distribution, WTD has been consistently adding new products, sizes and applications to its proprietary Arroyo and American Roadstar lines.

Last summer, WTD officials told MTD that the Arroyo line will expand to eventually encompass more than 300 SKUs.

New products include an Arroyo run-flat tire and an electric vehicle (EV) product, also under the Arroyo brand, that will be available in mid-2024.

Arroyo’s coming EV tire offering will deliver “outstanding performance and durability,” said WTD officials.

Vahe says WTD sees a lot of potential in the EV tire segment. “With an increasing percentage of consumers purchasing EVs, this opens an opportunity to provide a high-quality, high-value, EV-focused tire.”

WTD also has added 19-, 20-, 21- and 22-inch sizes to its Arroyo passenger tire line.

And the company reports it has made “impactful strides, catering to the heavyduty commercial vehicle segment.”

WTD’s ongoing expansion of its Arroyo TBR lineup “ensures that WTD customers have access to a wide range of sizes, catering to various vehicle types and preferences.”

“A lot of people are asking for TBR tires,” says Vahe.

“That market is not as saturated as passenger tires.”

WTD plans to roll out a new brand, American Hawk, in 2024, which will include TBR products, as well as passenger and light truck tires, for a full line.

According to Vahe, WTD has invested more than $15 million in tire design and mold development.

“Our tread patterns are our own designs. Everything is our own design.”

Combined sales of American Roadstar and Arroyo tires were projected to reach $200 million by the end of 2023.

CONTINUED INVESTMENT

“WTD envisions substantial growth in the upcoming years,” says Vahe.

“We are committed to introducing more high-quality private label brands, which will be distributed not only across our existing warehouses, but also (through) future locations.”

The company, he explains, also will continue to expand its distribution.

“We’re thinking of opening another warehouse” to maintain WTD’s inventory, which currently totals around 500,000 units.

“Our multiple, U.S.-based warehouses allow the customer to have additional inventory at their fingertips. Ensuring the success of our customers is our top priority.”

Mike Manges

Photo: WTD

Mazda - CX-5 – 2023

DESCRIPTION & OPERATION

I f the tire pressure monitoring system (TPMS) detects a tire with remarkably low pressure, it alerts the driver using the TPMS warning light and alarm.

Adjust the tire pressure before driving and while the tires are cold. Tire pressure changes due to changes in the ambient temperature and the internal tire temperature.

In regions and seasons with changing temperatures, the tire pressure changes due to ambient temperature changes. If the

TORQUE SPECIFICATIONS

tire pressure is lower than the lower-limit pressure due to low ambient temperature, the TPMS warning light may turn on. When the TPMS warning light turns on, adjust the tire pressure.

Tire pressure is high after driving because the internal temperature of the tires is high. If the tire pressure is adjusted to the standard when the internal temperature of the tire is high, the tire pressure lowers when the internal temperature decreases to the same level as the ambient temperature. If the tire pressure decreases below the lower-limit pressure, the TPMS warning light might turn on.

Generally, if the temperature changes by 10 degrees, the tire’s air pressure changes by about 1 psi.

The instrument cluster performs the following functions:

• Identification code recognition function:

Identifies whether the signals from the wheel units are those of the vehicle.

• Tire pressure determination/warning function: Determines whether the tire pressure information transmitted from the wheel units is within the specified range. If the tire pressure is lower than the specification, it alerts the driver using the TPMS warning light and TPMS warning alarm.

TPMS ID REGISTRATION

After the wheel unit replacement, registration of the wheel unit identification codes must be performed.

1. Switch the ignition ON (engine off or on).

2. Switch the ignition off.

3. Leave the vehicle with the ignition switched off for 15 minutes or more.

4. Switch the ignition ON (engine on).

TPMS

5. Drive the vehicle at a speed of 16 mph or more for 10 minutes or more.

6. A er driving for 10 minutes, verify that the TPMS warning light does not ash and is not illuminated.

TIRE PRESSURE SENSOR REMOVAL AND INSTALLATION

Removal

1. Remove the valve core and bleed the air from the tire.

2. Break the upper/lower tire bead.

NOTE: ere are two types of procedures for breaking the tire bead:

• Method for rotating wheel against bead breaker,

• Method for securing wheel.

(See Bead Breaking Note for tips on both methods.)

3. Remove the upper/lower bead using the following procedure.

a) Install the wheel and tire to the turntable of the tire changer.

b) Set the bead removal head to the position shown in Fig. 1. Set the air pressure sensor to the position shown so it does not get damaged.

c) Rotate the turntable and remove the upper bead.

d) Grasp the tire and slide it in the upward direction.

e) Insert the tire lever as shown in Fig. 2.

f) Remove the lower bead.

To prevent damaging the air pressure sensor, do not allow the tire lever to contact the air pressure sensor.

4. Remove the air pressure sensor from the wheel using the following procedure. To prevent damaging the air pressure sensor, remove the sensor housing before pulling out the valve.

Remove the air pressure sensor a er the tire is completely removed from the wheel. Wipe o any dirt on the air pressure sensor.

a) Remove the screw.

b) Remove the sensor housing.

c) Remove the tip of the valve.

d) Using the valve removal tool, pull the valve straight out of the wheel hole.

Installation

1. Apply soapy water to the area. To prevent damaging the air pressure sensor, do not soak it in water or spray water on it.

2. Remove the cap.

3. Insert the air pressure sensor valve into the wheel valve hole.

4. Install the valve removal tool to the air pressure sensor valve.

5. Pull the air pressure sensor valve straight out of the valve hole and secure the air pressure sensor to the wheel.

Pull the air pressure sensor valve straight out of the valve hole. If the air pressure sensor valve is pulled out in the wrong direction, excessive force could be applied to the valve resulting in damage.

To prevent air leakage, install the valve so that there is no gap between the tip of the valve and wheel.

To prevent damaging the air pressure sensor, do not apply impact to the wheel or pressure sensor.

Install the air pressure sensor so that it does not contact the inner side of the wheel.

After applying soapy water, install within ve minutes.

Install the air pressure sensor to a clean and dry wheel with no burrs/ le scratches on the valve hole.

Do not use an air pressure sensor that has been damaged by being dropped from a 1 meter or more height.

Always install the valve cap except when pumping air, bleeding air, and checking air pressure.

6. Verify that the air pressure sensor is installed parallel to the wheel.

7. Apply bead wax to the tire bead area.

8. Install the tire to the wheel using the following procedure:

a) Install the wheel to the turntable of the tire changer.

b) Place the tire on the wheel. (Verify the rotation direction of the tire.)

c) Set the installation head to the location shown in Fig. 3.

Set the air pressure sensor to the position shown so that it does not get damaged.

d) Rotate the turntable and install the lower bead.

NOTE: If the upper bead slips on the wheel while installing the lower bead, stop rotating and install it again from the correct position.

e) Install the upper bead using the same installation procedure for the lower bead.

9. Pump air into the tire.

Bead Breaking Note (Method for Rotating Wheel Against Bead Breaker)

1. Install the wheel and tire to the turntable of the tire changer.

2. Set the bead breaker against the air pressure sensor.

CAUTION: Do not set the bead breaker outside of the area shown below to prevent damaging the air pressure sensor.

Fig. 1

Fig. 2

TPMS

3. Rotate the wheel and break the upper/ lower bead.

CAUTION: Do not move the air pressure sensor outside of the area shown below to prevent damaging the air pressure sensor.

Bead Breaking Note (Method for Securing Wheel)

1. Install the wheel and tire to the bead breaker.

2. Set the bead breaker against the air pressure sensor as shown in Fig. 4.

CAUTION: Do not set the bead breaker outside of the area shown below to prevent damaging the air pressure sensor.

3. Break the upper bead.

4. Break the lower bead.

5. When replacing a wheel unit(s), register the new wheel unit ID(s). (See TPMS ID REGISTRATION.) ■

Information for this column comes from the tire pressure monitoring systems data in ProDemand, Mitchell 1’s auto repair information software for domestic and import vehicles. Headquartered in San Diego, Mitchell 1 has provided quality repair information solutions to the automotive industry since 1918. For more information, visit www.mitchell1.com.

Fig. 3

Fig. 4

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