A decade after the TREAD Act and almost four years into mandatory TPMS on all passenger vehicles in the U.S., one can fairly ask: Is TPMS still a headache for the industry, or has it become a profit opportunity for smart tire dealers?
There are varying opinions, and ultimately the reader will have to decide.
The TREAD Act (Transportation Recall Enhancement, Accountability and Documentation) was passed in the fall of 2000 following the Ford/Firestone fiasco. Reacting to an angry, misinformed and confused public, Congress wanted to make sure that tires were “safer” for the motoring public.
Of the TREAD Act’s 12 different components, nine – including mandatory TPMS – most affected the tire industry. NHTSA was made responsible for establishing and monitoring the TPMS regulations, while tire dealers – who had little to no input on the TPMS regulations – ended up in charge of dealing with them and the public.
After a few years of ramping up, since September 2007 every new passenger vehicle and light truck manufactured for sale in the U.S. must be equipped with TPMS, which leads to the underlying reason for this article: Where are we today?
On one hand, there is a wealth of information available, quality products from numerous sources, training from a host of experts and suppliers, the tools needed to work on the systems have been refined, and there seems to be continuous discussion amongst dealers.
But what I found in researching this article was that there is still a lot of confusion, an overall lack of knowledge and dealers who resist accepting TPMS. The intent of the TREAD Act was to make sure that tires were safer for the motoring public, but over the last 10 years it appears that the consumer has been left in the dark about TPMS, creating both a headache and an opportunity for savvy tire dealers.
Information for this article was compiled from interviews with Wayne Drumheller of Duncan Brothers in Winchester, Va.; Bobby Cutchins of Bobby’s Tire Pros in Franklin, Va.; Neil Schlossberg of American Tire Distributors; Jay and Todd Huff, Matt Sheeler and Doug Meekins of Brooks-Huff in Baltimore, Md.; Dan Zielinski of the Rubber Manufacturers Association; Kevin Rohlwing of the Tire Industry Association; Matt McCoy of M&M Tire in Blacksburg, Va.; Howard Laster, Steve Landis and AnnaMaria Blose of Continental Commercial Vehicles & Aftermarket; as well as some off-the-cuff discussions with a range of tire consumers.
I began by asking each of the individuals the following questions:
Does the whole TPMS mandate require a rethink in terms of the inflation threshold?
Zielinski: The main issue where I think RMA has some views is the TPMS threshold, which is currently set at 25% below the vehicle manufacturer’s recommended inflation pressure. RMA strongly advocated for a lower threshold when this regulation was being crafted by NHTSA several years ago. We argued that the threshold should be set at the point where the inflation pressure was insufficient to carry a vehicle at maximum load. This would differ from vehicle to vehicle. At the point where inflation pressure is insufficient to carry a vehicle’s maximum load, tire damage could occur that may lead to failure over time.
As technology has continued to improve and attention to vehicle fuel economy has increased, it may be worthwhile to discuss the TPMS threshold issue again. Since low tire pressure affects vehicle fuel economy, an earlier TPMS warning could be considered that would demonstrate that low tire pressure is negatively affecting fuel economy. For instance, a yellow light could be considered to warn motorists that fuel economy is affected and a red warning light for low tire pressure could be one that demands immediate attention since safety may be affected. Vehicle manufacturers might want to consider this on a voluntary basis as a means to encourage motorists to pay more attention to checking tire pressure regularly to avoid wasting gas.
Laster: When NHTSA first started with crafting the regulation, I can only presume it was difficult to come up with a standard that would adequately cover all vehicle types, climate, driving conditions, weight, balance, etc. We’ve struggled with an uninformed buyer since the inception of TPMS, which has made this even more challenging. I believe that motorist education is a key component in this discussion.
Sheeler: Consumers for the most part are very confused by TPMS. There is no consistency between car manufacturers and no one has really taken the time to educate drivers on the benefits of the system.
How have tire dealers adjusted and how have their businesses changed?
Cutchins: It has been a huge change to make sure all of the employees are up to date on everything and trying to educate the consumer on what he or she needs to know about TPMS. The biggest impact is on our people at the sales counter and dealing with the consumers…they don’t understand and often come in thinking they have an emergency when the light is on.
Drumheller: I feel like most tire dealers have stuck their head in the sand, hoping TPMS will go away. We’ve embraced TPMS at Duncan Brothers and took this seriously from the beginning. It’s no different than fixing a flat. We’re the professionals and the more we work on this, the easier it gets.
McCoy: I’m surprised how many dealers are not working on TPMS. We look at this as an opportunity with our two stores to improve profitability. It’s not going away and we’ve positioned ourselves as the experts in the market, which will pay off down the road.
Huff: That varies greatly by dealer. Those who are prepared have a difficult time charging appropriate amounts for parts and service because of consumer “unawareness.” Combine that with the big-box store mentality of giving everything away and it makes it tough on smaller independents to come up with a standard procedure and price.
Schlossberg: Independents have been slower to embrace the TPMS rebuild kits and charge the customer as opposed to the big-box retailers. They seem to be more sensitive to the economy and somewhat reluctant to add another charge to the invoice. The average dealer sees this as just another government mandate, and until recently they have not seen a steady stream of vehicles with TPMS.
How have the TPMS sensors and technology changed?
Laster: Originally, there were eight primary manufacturers of OE sensors; today there are five. We engineer the entire system for OE, which includes the sensors and the receiver, giving Continental a higher level of knowledge for developing aftermarket replacement sensors. Aftermarket TPMS competitors only supply sensors or do not supply OE at all. There is still a lot of specialization at the OE level and it will probably continue. On the replacement side, we and other companies have developed universal/multi-application-type sensors that have significantly reduced the number of SKUs necessary for a dealer to carry. For example, our VDO Redi-Sensor offers more than 90% coverage of GM, Ford and Chrysler vehicles with only two SKUs. The sensors are pre-programmed and ready to install right out of the box, allowing the technicians to seamlessly transition from OE sensors. There is still a wide variety on the OE side and over 100 models, which translates into a lot of SKUs in the aftermarket. But, the aftermarket focus is on more standardization going forward.
Rohlwing: The SKUs are narrowing somewhat, but there will always be a variety because of different vehicle manufacturers and OEM specifications. The universal sensors will certainly make it easier in the aftermarket as they gain in popularity and become easier to program. OE is working to establish global mandates and every vehicle manufactured worldwide will soon have some type of TPMS system. It’s here to stay and hopefully will work toward one standard over time.
Drumheller: There are problems with some of the sensor assemblies, especially in the Pennsylvania markets. The aluminum in the body is wearing out from salt and the core freezes inside in some cases. We find this happens mostly when the valve caps are left off. We can sometimes free this with a lubricant spray; if not, the customer has to replace the sensor.
Schlossberg: The TPMS rebuild kits present an opportunity that many dealers have overlooked in the past few years. As more and more cars come into the shop with TPMS, they will need to have the components of the sensor replaced. This is no different from a valve stem, really. For as long as I can remember, tire dealers have replaced a stem when new tires are purchased. They wear out, and so does the grommet and valve core in a TPMS sensor. If we’re not replacing the components when we’re working on the tires, the consumer can potentially encounter problems down the road.
How have the TPMS tools changed?
Schlossberg: The tools continue to progress. The earlier models were basic “hunting” tools, where they would send out a signal and “look” for sensors. They couldn’t tell what kind of vehicle or the specifics, they would only identify that there was a signal. They’ve progressed to a tool that will identify the make, model and year of the sensor. They can now do diagnostics, tell air pressure, identify OE part numbers and sensor ID numbers – and are all upgradeable. The original tools were not as capable, so to a degree this scared many of the technicians. The tools used to be harder to use and took anywhere from 10-20 minutes to read and reset the sensor. Today, new technology can do the same job in under a minute. You still need information and steps to put the vehicle into the “relearn” mode, which are widely available from numerous providers.
Landis: TPMS scan tools are continuing to develop and there are several manufacturers that produce great products. You need to have the right tools for your shop, and the price can be justified based on your type of business. Dealers need to understand what features they really need, and how much time is saved by purchasing a better tool. What features are worth it for your specific business model? What is the time needed or saved by purchasing a better tool? And with new technologies that are able to detect low battery life of the sensor and display tire pressure, there are opportunities to sell sensors and promote service.
Have drivers adjusted to TPMS?
Drumheller: No. I feel that about 75% of the drivers tend to ignore the TPMS light and just keep driving the vehicle.
Cutchins: I think it’s information overload for consumers, which in turn makes it difficult for tire dealers to take the time to educate consumers on exactly what they need to know about their vehicles. I would have to say they haven’t adjusted. Some understand, but a majority just think it’s an immediate issue when that light comes on or their information center lets them know something is happening.
Sheeler: Consumers are mixed in their concerns with the light. Half seem to ignore it and the other half panic when it comes on. Cold weather always triggers lights when the air pressure is marginal, and we have to take the time to educate them on air pressure when they come into the stores. Customers don’t know the difference between a “flashing” light or “steady” light when they come in, which adds to the confusion.
Meekins: Vehicle owners with TPMS need to be better informed. They tend to be unaware why TPMS is on the vehicle, what it does and what it takes to service the sensors. They have no idea about the components of the sensor – special caps, valve-cores, grommets, etc. Sensors also have batteries, and they will go bad over time. We don’t see a lot of these in our shops yet, but when they start failing we’ll have to take the time to educate consumers and be able to explain why they have to pay for a whole new sensor and the costs associated with it.
Landis: My opinion is the vast majority of drivers don’t know they have TPMS or what it is, and when the warning light appears it can confuse them. Education has not made it to the consumer yet. The tire dealers are aware of TPMS, but many new vehicle salespeople are uneducated on TPMS and, therefore, aren’t always explaining TPMS to a new vehicle buyer. Consumers understand why they need an oil change as preventive maintenance or need a set of wiper blades – those segments have done a fantastic job of consumer education – but they don’t understand TPMS, which burdens the industry on educating consumers about the benefits of the system/properly maintaining tires and tire pressure: safety, better handling, improved gas mileage and tire life, less chance of hydroplaning, etc. We need to sell the benefits of maintaining the system. If consumers are informed, it’s easier for them to have a willingness to pay for the important TPMS service and see the value in the work performed.
Rohlwing: Customers don’t understand and dealers need to explain. We should position the light being on as a good thing. It’s a signal that tells the driver that something is wrong and it needs to get serviced. Take the positive role and tell them how it works and how it can save them money.
What have the associations done in helping the industry and tire dealers deal with TPMS?
Rohlwing: We’ve been on the cutting edge with training. Our original ATS Certification Program has been updated to include TPMS. Available in the second quarter, the workshop picks up where the old program left off. It’s hands-on training that allows the dealer to take the extra step to get certified by an independent association. Additionally, TIA has produced a laminated TPMS Relearn Chart, which gives technicians everything they need to know about working on TPMS. By make and model, it provides relearn steps, sensor part numbers, rebuild kit part numbers and torque specs. It’s laminated and faster than printing out the data from a computer.
Cutchins: For the most part, it’s been good. They’ve provided the education to the dealer and the training necessary to educate the consumers. The Virginia Automotive Association also has provided training.
Huff: They have done a fairly good job on the dealer side, but there needs to be much more consumer awareness. We’ve sent a person from each of our six stores to TIA’s ATS/TPMS-certified trainer program; that person, in turn, works with the employees at the individual stores. It’s a costly investment and one that we need to stay abreast of industry changes. We love the new TIA Relearn Chart; it’s worth its weight in gold. It saves us time and makes it easier. It’s to the point and works on all vehicles.
What are you doing at your individual dealerships with TPMS?
Drumheller: We have developed a standard procedure for our six stores. We tell the customers up front when they have TPMS on their vehicle, and when selling tires we add an extra charge for rebuild kits. They appreciate the education and the “why” they need to have the service done. We have a wall chart to refer to that helps with the explanation, and have a mindset with our people to sell TPMS:
First and foremost, you must believe that rebuilding the sensors is as important as replacing rubber valve stems. You’ll encounter problems, but it’s important to stay committed because there is a learning curve. You must stock the TPMS kits and have a local source for sensors and additional kits. Make sure you have all the tools to do the job right, including the “inch-pound” torque wrench. And if you haven’t gotten a reset tool, do so.
Cutchins: We offer a full service for TPMS but unfortunately, we are not being compensated for it. We have not been charging for the relearn and may be missing the boat. We offer and stock the rebuild kits, but it’s not something that we push on a consistent basis. The issue is going to uneducated TPMS consumers and explaining an up-charge of $6 to $8 per tire. When adding the tire protection plan and nitrogen to the ticket, they think you’re piling on. In a smaller market with a down economy, that can be a tough sell.
McCoy: It all starts at the front counter. We’ve educated our salespeople and work to educate our customers. We charge for the rebuild kits and the system relearn. When compared to what the car dealerships charge, we can do it for a lot less. We stock the rebuild kits and have a procedure in place to check the vehicle up-front for TPMS to help avoid problems.
Huff: We take the time up-front to try and educate the consumer at the counter. We have a Schrader display on the counter to help, and most people don’t have a problem. All vehicles are checked prior to driving into the shop to see if the TPMS light is on, and we don’t let it leave if the light is still on. We are not charging for rebuild kits yet. We’re working on evaluating the inventory needs, which can be substantial when stocking six stores.
Schlossberg: I feel dealers need to embrace this sooner than later. TPMS is here to stay and I think there is a revenue opportunity. Here are our three steps: Believe that TPMS is here to stay and you’re providing the customer with a valuable service; get training – both the technicians and salespeople; and get the right tools. It’s an investment, but one that we have to make if we’re going to be in the tire and service business.
Additionally, test the sensors before and after the vehicle is worked on. Dealers get blamed if the light is on, whether it was our fault or a faulty sensor when it came in.
Is TPMS a headache or a profit opportunity?
Drumheller: Headache, but the more you do it the easier it gets and the problems become fewer and farther between. As you learn, it gets better and moves to the profit side of the scale.
Cutchins: Headache.
Huff: Headache, but we have to make it a profit opportunity. It’s not going away.
McCoy: No headache, just a solid profit opportunity.
Ten years after the Ford/Firestone fiasco, there continues to be confusion. The overriding issue is still low air pressure. We would like to think that consumers learned something after the recall and all the press associated with it, but the reality is that nothing has really changed: most drivers don’t check the air pressure in their tires. This was confirmed when RMA conducted a survey of more than 6,300 vehicles in conjunction with National Tire Safety Week in 2010, and found that only 17% of vehicles had four properly inflated tires
From my perspective, I think the answer can be found in education. We need to make sure that our staffs have all been through one of the numerous training courses available – and that when new information is made available, they remain current.
The industry has changed. As Jay Huff stated, “The general service tech is usually the lowest paid in the shop; with each car that comes in, that person is responsible for $1,500-plus in tires and wheels and another $400 worth of sensors. The caliber of the person needs to be better than what it used to be. They have to be better trained.”
We can’t afford to send a problem to the car dealers. “What does that tell the customer if the tire experts can’t solve a problem with a TPMS light and we have to refer it to a car dealer? It says that we’re not professional and it will be tough to keep them as customers in the future,” said Drumheller.
Education…I know it’s a lot harder than just a single word, but as tire dealers, we need to make the effort to ensure our sales staff, our technicians and our customers are more informed. The resources are available, and if we take the initiative as dealers, the profit opportunities will present themselves – directly through TPMS service, and through positioning ourselves as true professionals.
TPMS is here to stay. Many dealers I have spoken with still see it as a headache, but with greater focus we can make TPMS a profit opportunity.
I’ve maintained for years that, “We didn’t build the vehicle and we didn’t break it, but we are in the position of having to service or repair it.” We also did not write the regulation that mandated TPMS, but if we’re going to thrive in this business, we need to embrace it.