Trimming the Fat?
June 30, 2009
Thought occurred to me the other day: If GM and Chrysler are cutting costs by rationalizing distribution, might not tire companies benefit from the same?
As you know, thousands of GM and Chrysler auto dealers were pink slipped recently as the bankrupt former auto giants struggled to shed debt and rebuild. Newspapers and local TV stations have been filled with hard-luck stories of long-time Chevy, Dodge, Pontiac, Chrysler, Cadillac, etc. dealers that were abruptly curbed.
One of the reasons for the dramatic reduction in retail of points of sale was oversaturation; it’s very hard to make profits if your product is available on nearly every street corner, and if your retailers are competing against one another with your product.
And the cost factor for shipping products to so many locations, managing your business within those dealerships, and supporting those locations with advertising, promotion dollars and otherwise has to be huge.
It’s little wonder any automaker can make a buck these days. Hhmmm…that sounds vaguely familiar.
With major brand names available at mass merchants, price clubs, car dealers, online, company-owned stores, chain stores an, of course, independent tires dealers, how can those brands (and their owners) make a decent profit?
One of the keys to marketing a premium product is to make it appear to be “exclusive.” You can do that with support materials, with fancy ad and PR words, and by limiting distribution – make it harder to get.
As tiremakers consider their balance sheets and financials, one has to wonder if the next wave of belt-tightening might now come from the distribution side instead of from the tire company side.
Just a thought.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
It’s Just a Matter of Time
June 30, 2009
Hey, we told you so!
In our 2007 rundown of Market Influencers (September 2007 issue), we said that “iMedia” would indeed become a major force in the tire industry.
Admittedly we were a bit premature. 2008 wasn’t the Year of the iMedia we envisioned. We weren’t wrong, just a little early.
But now comes word that the iPhone – more appropriately, iPhone apps – has found its marketer legs. And it’s time to take note, tire folks.
Dunkin’ Donuts has joined insurance giant Nationwide in developing their own iPhone apps. Nationwide’s app will allow customers to use their iPhones to make claims instantly – right at the accident scene! Click a couple of photos and send them along with the basic accident info.
And thanks to the new DD app, you can wake up and iPhone the coffee by instantly placing a to-go order at your nearest Dunkin’ Donuts. On the road? No worries – the app will find the closest DD.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Will It Go Round in Circles?
June 26, 2009
Now that NHTSA has set out its 177-page proposal on testing and grading tires for fuel efficiency – not to mention a consumer tire care education program – one can’t help but look back fondly at the early days of Uniform Tire Quality Grading, NHTSA’s first attempt at testing and grading.
Thirty years in the rearview mirror, we hardly notice UTQG. Same with consumers. But back in the day, consumers demanded to know how best to determine the relative “quality” of competing tires.
In May 1979, Tire Review published one of the first compiled lists of tire brand and line UTQG ratings. Along with that three-page rundown, then editor Bill Whitney offered some insight into the complications surrounding UTQG back then. One can see that tiremakers – and even the magazine – were confused about UTQG, but some of Bill’s comments still ring true today.
What Bill failed to mention is that UTQG came about primarily because tiremakers and marketers created an absolute mess of things, clouding consumer minds with so-called 100 Level and 200 Level tires, even though there was no legitimate way to determine the difference.
It’s interesting, too, to see what early UTQG results looked like…and what passed for a premium tires.
Here is a condensed version of Bill’s editorial on the subject:
The UTQG requirement for bias-ply tires has been in effect for a month. Tire Review conducted a comparative study of the grading system and discovered why so many tire dealers, private brand owners and manufacturers have been upset over the regulation.
To say the least, the Department of Transportation opened a Pandora’s Box. NHTSA says that “while the new standards do not tell a tire buyer what to expect in terms of tire wear, the standards should help a customer make an educated purchase.”
One of the first things a customer wants to know when purchasing a tire is how many miles can he expect to average. The grading system does not enable the customer to make an ‘educated purchase” with regard to tire wear.
Both the Rubber Manufacturers Association (RMA) and the National Tire Dealers & Retreaders Association (NTDRA) are concerned about the unreliability of the grading system and the consumer confusion this regulation has created.
They have, however, agreed to urge members to comply with the regulation and make the best of a seemingly hopeless (impossible) situation.
Confusion has not been confined to the consumer level. It has infiltrated dealers and manufacturers. The following pages contain a list of each bias-ply tire brand, line and size and what the brand owner reports is the tire’s treadwear, traction and temperature grading.
The reader can readily see several trends in the grading system.
First, several private brands have tires rating considerably higher than the major manufacturers.
A brief review of the charts seems to indicate a rating of 80BC as the norm. Cooper, Dunlop and Co-op, for example, have rated their brands in the 90-100 BC range.
Also of note are those brands, which have ratings of 120 and 140. Tire Review was told by the manufacturers of these brands that the tires in question are “high performance” tires and consequently are designed to wear 20% to 40% better than the DOT’s “control” rating of 100.
All treadwear ratings are qualified. The last sentence on the grading label tells the consumer that: “The relative performance of tires depends upon the actual conditions of their use, however, and amy depart significantly from the norm due to variations in driving habits, service practices, and differences in road characteristics and climate.”
So much for the idea that a consumer can make an “educated purchase.”
What the tire grading really tells the consumer is nothing.
Tire Review spoke with representatives of Goodyear, General, Firestone, Armstrong and Dunlop. Their opinions and observations are interesting. Most of the spokesmen asked not to be identified.
All agreed that while most tire dealers are ignoring the tire grading system by simply the grading hand out and not addressing the issue, some dealers are capitalizing on it.
For example, a dealer has a major brand name that rates 70 BC and a private brand that rates 100 AB. Some dealers are using the grading system to sell a private brand and realize a better profit margin over what they could have realized with the major brand.
The consumer is then led to believe that he is getting a better tire for less because he does not have to pay more simply to buy a “name.”
So why didn’t the big tire manufacturers think of this and rate their brands higher?
They, too, have the program figured out.
A conservative rating serves two purposes. First, a lower rating can help stave off the possibility of a lawsuit because a tire will almost certainly perform better than its rating.
Secondly, as several tire manufacturers put it, where can you go if you start at the top?
Bias-ply tires are not dead. New lines will continue to surface. As a new line is developed, the tire should logically be better than its predecessor. Thus it must have a higher rating. Consequently, while a current bias-ply tire may actually rate 90 AB, it has been labeled, by the manufacturer, as being 70 BC to allow room for growth.
The importance of this logic is not confined to bias-ply tires. It will carry over to radial tires when labeling takes effect on April 1, 1980.
So, once again, NHTSA’s theory that the “standards should help a customer make an educated purchase” simply does not hold water.
DOT deceived itself and the American public with the Uniform Tire Quality grading requirement.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Then He Celebrated With ‘Special Friends’
June 26, 2009
Max Mosely got his way. You’ve got to give that randy bugger his due, he figured out how to wrestle eight uber-rich race teams back into line.
All it cost him was his job.
The Formula 1 world breather a sigh of relief Thursday when it was announced that FOTA – the wildcat Formula One Teams Association – was a dead issue and that there would be a singular FIA-crowned world champion in 2010. And, supposedly, beyond.
Mosely will end his 16-year stranglehold on FIA, the series’ sanctioning body, in October when his fifth term ends.
Good damn riddance. Most observers have felt that between Max’s ironclad, often divisive rule and that of F1 chief Bernie “Big Pockets” Eccelstone, the series has become cost bloated, overly technology driven, exclusionary and, well, darn boring.
And then there was the embarrassing incident last year when the 69-year-old FIA president, the son of former British fascist leader Oswald Mosley, was caught partaking in a sadomasochistic orgy with five prostitutes in London. A video of the incident was widely circulated on the Internet.
Max did get the FOTA members – Ferrari, McLaren, BMW Sauber, Renault, Toyota, Red Bull, Toro Rosso and Brawn GP – to buy into a modified cost-cutting plan, and to swear their technical help to future incoming teams.
Hopefully Max’s parting gift to the racing community will end up being a stable, more global and more competitive “world championship” racing series.
And hopefully Bernie will be the next to leave.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Trespassers Are Warned!
June 24, 2009
As mentioned the other day, American Tir…I mean Colorado Tire Corp. has changed its name and taken down its previous Web site, promising to launch a new one soon.
When the ATC site was first taken down, it carried only a single post that basically sort of explained the company name change and the promise of a new Web location. It was short, sweet and sort of to the point.
And then things changed…Below is the statement – verbatim – that now appears on the site:
Announcement
In order to consolidate our corporate identity behind our company's most recognizable and valuable asset, i.e., the Colorado brand OTR tires, which have been extensively approved and recognized by various users in different countries, the Board of Directors of American Tire Corporation has determined to change our corporate name to Colorado Tire Corporation.
Any existing and ongoing contracts/agreements/authorizations between any company and American Tire Corporation shall be reentered with Colorado Tire Corporation by the end of June 30, 2009, or otherwise will be deemed invalid.
Our old web address www.americantire.us will be no longer in service. Our new web site will be announced separately.
It has come to our attention that several companies and individuals respectively in Akron, Ohio and Spring Hope, North Carolina, who are working for our competitors, are writing and spreading libels related to us. Further, we have received quite a few reports that a number of Chinese and western companies are selling FAKE "Colorado" tires. Without question, such acts are, in many countries, not only illegal, but also criminal. Our legal counsels have been instructed to take proper actions against such illegal and/or criminal acts.
Our Board of Directors believes that such a name change will enhance us in protecting our brand from any illegal/criminal act.
Any questions or inquiries, please feel free to email to info@CoTire.com.
So whomever it is in Akron or Spring Hope that is causing the company concern, considered yourselves warned.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Dear China
June 24, 2009
It has come to our attention that we apparently just don’t want you around. The glow of the Olympics has passed, and we’re tired of all of the Travel Channel reruns. I mean, just how many times can we see Andrew Zimmern eat his way through your country? And how you let Samantha Brown in we’ll never know.
It’s not that we don’t like you. Heck, you’ve got more cool history in a grain of rice than we do from sea to shining sea. And who doesn’t love those pandas? But we just decided that we don’t want what it is you have to sell. You see, despite our inbred desire to buy everything on sale (even if it isn’t), we’ve apparently decided it’s best if we just fend for ourselves. From now on, we’ll be taking back production of a whole host of goods our corporations effectively outsourced to you many years ago.
So, for the foreseeable future, please keep those cell phones, DVD and Blu-Ray players and digital cameras (except maybe a few iPhones cause they are just too cool). Computers and monitors and servers and modems can stay there, as well. And we won’t be needing any of those inexpensive office desks and chairs.
Kick those football tees and toss away the baseballs. Gloves, too. And don’t forget the batting helmets and catcher’s gear, hats and uniforms and socks. Baseball is America’s Game (don’t tell the NFL) and we’ll make our own gear, thank you very much! Who cares if batting helmets cost $300 each!
Nobody really likes yard work, so hang on to those rakes and shovels and planters and hoses…all of that stuff.
Coffee cups, cookware, glasses, plates and place settings? No thanks. Same with tablecloths and napkins (not that we use those).
Tchotchkes, bric-brac, niff-naws, thingamabobs, doo-dads…we just don’t have room anymore.
And box up those jeans, shirts and pink tank tops. OMG…can you believe just how cute those are?
You know, this list will just get out of control and I just don’t have the time right now. I’ll send you an e-mail later. Better yet, just stop shipping anything over here. That way the unions will be happy, and we’ll be able to return to normal around here.
One thing…ship a few more containers of those “We’re No. 1” foam fingers our way. We have a big “Welcome Back Manufacturing” rally planned and, well, we’re on a bit of a budget.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
They Ready and Waiting
June 24, 2009
If you think the rest of the market is taking a big nap while GM and Chrysler dealers – and all of those service bays – are getting whacked, thing again.
This from Meineke Car Care Centers:
Meineke Car Care Centers Supports Right to Repair Act
Chrysler and GM bankruptcies highlight need for additional repair options
June 16, 2009 - As of early June, Chrysler LLC wants to eliminate 789 dealerships – roughly one-quarter of its total U.S. dealerships – saying that their sales are too low. General Motors seeks to make a similar move. While the final decision rests with the bankruptcy courts, the possible closing of these dealerships has customers concerned: Who will handle the warranty work on their Chrysler and General Motors’ vehicles?
In the meantime, according to CNN.com, car owners’ warranties will remain valid through their term regardless of where the vehicles were purchased, and the required warranty maintenance work can be done at any certified shop. This may be a much better option for consumers than driving to the nearest existing Chrysler or General Motors dealer. Many of the dealerships targeted for closure are in small to mid-size towns, meaning that the next closest dealer may be up to 60 miles away.
“Manufacturers like Chrysler and General Motors require that new vehicles be maintained in accordance with the specifications outlined in the vehicle’s owner manual in order to protect the new car warranty,” says Don Rauch, director of dealer communications for Meineke Car Care Centers. “What owners may not realize is that most Meineke Care Care Centers have ASE-trained technicians who are qualified to perform the maintenance work needed to preserve the new car warranty. We can’t perform repair work that is covered by this type of warranty, but we can provide the required maintenance.”
Rauch notes that restrictions on warranty repair work have accelerated the push for the Right to Repair Act, which would allow independent repair shops to compete for the business now guaranteed only to dealer-contracted establishments. Until recently, car manufacturers have severely limited the number of repair shops that are allowed to have the technology, diagnostic codes and updated repair information required to make some warranty repairs, given today’s computer-reliant cars. With the Right to Repair Act, the door would open for more independent shops to make critical repairs.
However, Rauch explains that certain warranty repair work can be done at local Meineke Car Care Centers. “If a customer purchased a vehicle service contract, also called an extended warranty, from a now-closed Chrysler or General Motors dealership, then local Meineke Car Care Centers can perform warranty work under these types of contracts," Rauch says. "We will be paid by the warranty company for those repairs. We advise customers to check and see what kinds of warranties they hold, and if they have any questions, please call us.”
For car owners looking to purchase a vehicle service contract, Meineke now offers contracts for most automobile makes and models with mileage up to 150,000 miles. This new program, called “Meineke Vehicle Protection” or “MVP” is available in 26 states across the United States. Car owners can log onto www.meinekemvp.com, or call 1-877-670-6877 to see if the program is offered in their state, and to get a quote for a contract.
“If you own a Chrysler or General Motors vehicle, don’t panic,” says Rauch. “We have the ASE-certified technicians to maintain and repair your cars and keep you on the road for years to come.”
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Ah, It Just Keeps Getting Better
June 22, 2009
Alleged U.S. giant OTR tire manufacturer and purported U.S. government-supported American Tire Corp. is no more.
The chameleon-like company – which has alternately traded as American Seashores International, Washington Tire Corp., American Tianbao Corp. and, of course, the infamous ATC – is now called Colorado Tire Corp.
Of course, it didn’t have a choice – in March, a U.S. appellate court so ordered that American Tire Corp.’s name and logo were easily confused with that of mega-distributor American Tire Distributors. The order was apparently affirmed last week by the original court.
So, now ATC is CTC.
For those who like consistency, though, there is good news. Apparently CTC “president” Abraham Hengyucius is still around, and the importer of China-produced OTR tires remains a mystery surrounded by a conundrum wrapped in a riddle.
And we wouldn’t have it any other way.
Still waiting, as I’m sure you all are, for news of a pending groundbreaking for CTC’s $1 billion OTR tire plant in Washington state. I’m hoping my invitation is in the mail!
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
More Tire Works News
June 22, 2009
I am putting this June 19 news report by Las Vegas’ KTNV.com here because despite its obvious tilt, there are a few valuable lessons here for tire dealers.
Tire Works, to catch you up quickly, is the Las Vegas tire dealer that was investigated by the state for alleged deceptive practices. The dealer is counter suing the state, but this type of publicity isn’t going to help its case.
Customer Sues Tire Works in Small Claims Court
Tire Works owner Roshie Weightman showed up in person to battle customer Jennifer Cairy in Small Claims Court.
"I paid, I waited 15 minutes and then the mechanic and the salesman came out and told me there was some additional problems and they weren't able to complete the work to their satisfaction," Cairy told Judge David Stoebling.
Jennifer went to the Tire Works on Silverado Ranch in February for an alignment and new brakes.
"They told you there were problems still with the alignment?" Judge Stoebling asked.
"After I paid," Cairy answered.
She tried to get her money back but Tire Works refused.
Then, as Contact 13 first reported in April, Jennifer got an e-mail sent by Tire Works District Manager Dalin Crowsey... An e-mail that wasn't intended for Jennifer's eyes.
In it, the manager calls her a nitpicking b---h and writes about "up-selling" her.
The judge wanted to know more.
"She came in requesting brakes and an alignment. Nothing was upsold to her." explained Roshie Weightman.
As for the name-calling...
Roshie said, "Unfortunately it was in poor judgment by Dalin to write such a thing and we did apologize to her and she did not want to accept our apology."
Jennifer told the judge how that "apology" came out.
"She said what do you want me to do to fix this? She said do you want me to take him out to the side of the store and shoot him? Do you want me to murder him? And I said, is this actually happening? You're actually a professional woman having this conversation with me? All I'm asking you for is my $60 back."
And all because they charged her for the alignment even though the tech told her they couldn't get it right because of something called a bushing.
Roshie told the judge, "The axle of the car holds the two tires. The bushings sit on top of that."
They told her they could fix the bushings for $1,800 but did the alignment anyway, which turned out to be no good despite what Roshie's contentions.
"The car was not pulling anymore. It was just slightly pulling."
"Do you have something that tells the customer that the alignment you're going to perform for them is not going, under certain circumstances, may not be worth anything at all? Do you have something like that?" Judge Stoebling asked her.
"No but we also don't have anything that says if the customer leaves and hits a curb five minutes after he leaves that the alignment will go right back out again." she answered.
"I think you should get your money back on the alignment. I think it was done, it shouldn't have been done," Judge Stoebling said, deciding the case in Jennifer Cairy's favor.
Outside the courtroom, Cairy told Contact 13, "It's nice to know that the smaller people, just the regular average housewives can get some justice."
And justice may be coming for many more if the Attorney General succeeds in her lawsuit against Tire Works.
The state is seeking to shut Tire Works down after an undercover investigation with Contact 13 revealed a pattern of deceptive trade.
"I hope that she's no longer in business. I hope next year there are no Tire Works and we can go to much better companies," Cairy said.
Tire Works owes Jennifer Cairy $176 but the judge suggested her legal battle with them shouldn't end there.
He asked why she hasn't pursued a defamation suit against them for the content of that e-mail.
Tire Works is already in the midst of a defamation lawsuit related to the state's investigation.
They filed it against the state's expert mechanic after he called their business practices fraudulent.
That case is scheduled for its first court hearing on June 30.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Sideshow Freaks and Max Mosley
June 22, 2009
Now that the 2009 F1 season has settled well into week after week of boring run-aways, you can always count on the carnival that is the Euro-race series to provide some comic relief.
FIA head Max Mosely, purportedly a bit of a sideshow freak himself, is scrambling to keep the current Formula One series together even as nearly every F1 team has announced plans to bolt and form its own world championship series – the Formula One Teams Association or FOTA for short.
And why are eight of F1’s 10 teams – including Ferrari, McLaren-Mercedes and new powerhouse Brawn F1 – looking to break away? Because Max wants to slap a spending cap on the notoriously free-spending race teams. A paltry $65 million annual limit.
And why does Max want to cut budgets? Well, unlike team principals, Mosely can see the forest for the trees and knows full well that 17-race nearly global series (no U.S. or Canada events again!) cannot continue its arms race, even in a good economy.
Some say Ferrari, for example, pours $400 million annually into its two-car effort. Through the first seven races of 2009, that pile of money has produced no race wins. McLaren, another mega-spender, hasn’t even earned a podium after fielding the 2008 champ Lewis Hamilton and nearly winning the 2007 slate.
So the uber-rich free-spenders want to go off on their own. Well, Max ought to just let them and then build an all-new, budget-conscious F1 series. While the FIA (which claims jurisdiction over FOTA, by the way) doesn’t need a split ala CART and Indy Car, it seems inevitable.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
King Harvest Has Surely Come
June 18, 2009
No doubt that within days I will get news releases from Bridgestone and Goodyear and Michelin and Cooper – everybody – announcing plans to build new plants in the U.S. to produce low-value broadline tires.
Why? Cause that is exactly what Leo thinks he’s gonna get now that the International Trade Commission has sided with the USW’s incredibly weak argument that radial passenger tires imported from China has directly led to the loss of thousands of tire plant jobs in this country.
And what Leo wants, Leo gets.
“Our domestic industries cannot survive unless our government enforces the trade laws designed to curb and dissuade anti-competitive practices that cause market disruptions,” said USW International President Leo Gerard. “We anticipate the remedies that will be delivered to President Obama will allow the time necessary to rebuild the U.S. tire industry.”
“Remedies”? “Rebuild the U.S. tire industry”?
Those “remedies” may well end up being what Leo wants – a three-year limit on the importation of China-produced passenger tires (an immediate cut to 2005 levels, plus up to 5% incremental increases for each of two years). Too bad, because those cutbacks will surely put more people out of work than will deliver new jobs to the USW. Like the private branders that depend on Chinese producers to make their products (since no one but Cooper still makes private brand tires), and private brand distributors and private brand dealers. Oh, and the legit importers of Chinese branded tires.
And there won’t be any rebuilding of the U.S. tire industry. Number One: It ain’t broke. In fact, our local industry should be commended for how it has managed itself in these trying times, working hard to minimize the negative impact on employees and distribution while trying to remain financially healthy. Very, very hard job, to be sure.
Number Two: No one will be adding capacity here to produce low-margin tires. Nobody, Leo, will be building new plants or adding production. Ain’t happening. The days of American- or Canadian-made Tier 3-4-5 tires is passed. There will be demand for those tires, because of consumer demand for size or price (mostly price, especially in these days). Whatever shortfall is left by the proposed import limits will be made up by tires from other low-cost countries, not by tires produced by your members.
I hear Indian tiremakers are real anxious to make a mark here. So, Leo, are you going to go after them, too? Are you going to chase every country? Hell, I got an e-mail today from some outfit selling Indonesian-made passenger radials.
It is, and has been, a totally disingenuous argument to claim that the sharp increase in the number of tires imported from China directly resulted in closed tire plants and lost jobs here. Equally absurd is the USW’s convenient loss of memory when it fails to recognize that its tire company employers have contributed to that import increase.
Those plants and those jobs went away because of cost. Because it cost a lot less to make low-margin, no-profit tires overseas than it did to make those same tires here. A number of years ago, raw materials costs, as we all know, went through the roof. Despite “concessions” made by the USW, it still cost too much to make those tires here. And some of those plants were closed because the USW itself proved to be a difficult dance partner; the union even negotiated the closure of one plant into its last master contract with Goodyear.
That is reality.
This is not: “We anticipate that the final decisions on remedies will improve domestic job security, increase production and sales, and allow for investment in capital equipment to better compete in the global market for the long term.” - USW vice president Tom Conway.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Hey, CBS Still Hasn’t Weighed In Yet
June 18, 2009
I gave you a few days to digest viewer comments made after last May’s “investigative report” by ABC on the “dangers” of older tires (see below).
Interesting to me is how many people figured it out for themselves, using words like “sham” to describe the report and reminding others of their responsibility to maintain their tires. Good for them.
Still, one year after the industry took that public lashing (NBC had a similar but little seen report on the Today Show in April 2008), nothing has happened. Nada. Of course, the lawsuits against tire companies and tire dealers over injuries and deaths purportedly caused by aged tires continue. And three states want to enact legislation to curb sales of old tires – all of which penalize tire retailers but not tiremakers. But those are apparently minor inconveniences, compared to, say, a firm position on the subject.
Apparently the RMA and TIA are still waiting for “scientific evidence” to surface.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
A Different View
June 15, 2009
We all remember the lashing the tire industry took last spring when both NBC and ABC televised “investigative” reports on the so-called dangers of older tires.
NBC’s report appeared on the Today Show, while ABC used its 20/20 newsmagazine to carry the water for Sean Kane and his plaintiff-attorney assisting Strategic Safety.
When ABC posted its report online, it offered viewers the chance to add their comments on the report. Here are all of the comments posted verbatim:
Hidden Tire Dangers
ABC News Hidden Camera Investigation: Aged Tires Sold as 'New' by Big Retailers
Viewer Comments:
Yeah know, I just cannot figure out why when things like this tire situation are anywhere near surprising to anyone..the basic rule in the great country of ours is to do the very best one can do to screw anyone who comes in contact with you, especially if its in politics or business, but really it applies to all phases of interaction in this hollowed land..what runs this country now is greed, the bottom line, the bigger the better and screw who gets caught on the hook....even religion in any form is not immune...lets here for Gene Autry good times are past...I am very blessed in the things that I have, but even those things are faulty because the builders and manufactures were crooked in thier processes, selling, installation anyway to increase the bottom line regardless of who gets under the wheels..so people if the moon explodes don't be surprised someone probably made a buck from it..
Posted by: oralcitrate Mar-25
This seems to be quite an old article, but it's still not difficult to find relatively old tires at many retailers, including dealerships. It's not an issue for most consumers in my experience, though, because there are certain tire sizes that are used by a multitude of vehicles and are therefore sold very quickly. However, there are some sizes that are used by far fewer vehicles that can easily stay in stock for two years or more. However, these tires neither bear any weight nor receive exposure to sunlight, extreme temperatures, and/or ozone. I've read that those factors contribute the most to the deterioration of a tire. I've also read that, perhaps ironically, tires which bear a heavy load and are not used often may deteriorate faster than tires on a vehicle that is driven regularly. One of the biggest obstacles to offering consumers services that will ensure their safety is the amount they are willing to spend. Consumers sometimes knowingly place themselves in very hazardous situations by seeking the cheapest route possible. I'd also like to mention that there are many situations that present a Catch-22 for a tire service technician. If a tire technician refuses to perform a service such as selling and/or mounting an aged or damaged tire because he/she believes it is unsafe, he/she could be in trouble with his/her management for not acquiescing and offering customer satisfaction, particularly if he/she refused the service in error because of improper training. On the other hand, if he/she performs the service and the tire contributes to an accident or inconvenience, the technician could be in trouble with his/her management for putting a customer in a hazardous situation.If this issue is ever pursued again in the future, I think more focus should be placed on obtaining answers from management of such retailers and the manufacturers themselves.
Posted by: unmotivator Feb-27
Dissecting a 10 or 12 year old tire sitting on a shelf showing separation or conditions leading to separation may have substantiated your report. You have done an injustice to your industry as well as the tire industry.
Posted by: bjlr501 12/7/08
Interesting stuff but I'm curious about the "research and tests" that show "as tires age, they begin to dry out and become potentially dangerous". Who conducted these tests, and is the validity of the testing recognized by the automotive and tire manufacturing industry? And how does the accident rate attributable to aged tires compare to accident rates that are due to tread separation and other inherent tire flaws?
Posted by: hankgordon2 8/12/08
It's a load of bull.... You MUST perform routine maintenance on your vehicle. This includes things like changing the oil, topping off the fluids, Changing brake fluid ever 1-3 years, checking engine belts for wear and cracking, changing your fuel filter, and yes - checking your tires for wear. The reality is if you put on the standard 12,000 mile a year, your tires will only last about 3-4 years anyway. If you want information on how to check your tires and what you should look for, Tirerack.com has tire test results and general tire info that can be very helpful. I took a nail in a tire once and I had to keep inflating it every month or so because I couldn't find the hole. The nail was still in the tire when I finally replaced it. Unfortunately, not only did my mileage go down, but my brakes became more worn as a result and I ended up paying for a new brake job. While you are checking things on your car, have a friend or family member help you check your lights. Turn signals, brake lights, head lights and other marker lights can go out at any time for any reason and most of the time, you would never notice.
Posted by: windsurfing_guru 7/31/08
Thanks 20/20 for the invaluable info. I have broadcasted to everyone I know. Who knows you may save some lives without even knowing! Keep up the good work of keeping America safe and informed.
Posted by: beckstr2000 7/8/08
I just took off two tires date code 1990-1991 off my vette 18 year old tire driven the car in excess of 100 mph for long periods no problem These are the speed rated high quality tires that were OEM. The gov not going to scare me into footing the bill for there wining and dining because they need more tax from everyone. Test some real tires in real age conditions not article aging and SHOW ME!!!!!!!!!!!!!!! the real results for all tire brand proceses type speed rating and so on. They cant test a cheap poorly maintained tire and say ALL tires of age are defective. Is Bush getting a kickback on tires also?
Posted by: mikevette1990 6/3/08
You people are ridiculous, If you came into an autocenter before this and were told to replace tires based on age you would say "you're just trying to sell me tires" It's safe to say that the majority of those tires were on CLEARANCE RACKS. I don't know how many customers i have come in and say, i want the cheapest tire blah blah blah....you get what you pay for. In this time and age of MCDONALDS all you people want it and want it now. It's pysically impossible to have every tire in stock in every size and only have it be 6 months old.
Posted by: mopar53150 5/25/08
I hope all of us take this information seriously, as a member of my family was just in an accident yesterday for this very reason. Do yourself a favor, do your family the favor of giving this the benefit of the doubt and go check your tires. The car rolled several times and we are so grateful he was okay, but the officer on site was surprised that was the case. How much does it really take to make sure you're really safe. Thanks for the information ABC. This little life-saving tip should not have been kept a secret. Thanks for telling us all.
Posted by: ktrenae 5/17/08
I don't know a lot about tires but I have a 1983 Mazda RX-7 with only 34,000 miles, that I bought from my mother who hardly drove it while she owned it for 12 years. I continued to drive it for 12 more years occasionally and I never had to replace the tires until one year ago when they started to crack. I kept checking with my local trusty tire store to assess the tires and they kept saying they were fine until last year. So, I don’t think age is the main factor. I recommend building a relationship with a tire store you trust and keep checking with them about the condition of your tires.
Posted by: uoft1985 5/12/08
I agree with many of the people here that the age of a tire does not constitute if a tire is bad. If you do proper air pressure checks, rotations and alignments on your vehicle then your tires will function the same whether it be 6 months old or 10 years old. The weather has a major effect on tires and not age. So do you want to talk about the belts on your car? They are made of rubber? Do you think they all have a shelf life of 6 months? NO! It is all maintenance of your vehicle. Don't you think that every single tire manufacturer would put "expiration dates" on their tires if the proof was there? They don't because there is not enough evidence to prove this myth. Leave these tire dealers alone and talk to the manufacturers of these tires.
Posted by: firstbrunettedaughter 5/12/08
You are SO busted. I will not, repeat NOT, buy a tire from you if you can not certify that it is less than a year old. Period, fini, end of story. So you might as well bite the bullet and write off all those 2 - 12 years old tires right now!
Posted by: alice888 5/12/08
The tire investigation was fine work. Missed the first part and hope to see this segment again. As for the general content of 20-20, I much prefer the hard news investigations that save lives over the celeb news and soft pieces I see so much of on your program in recent years.
Posted by: TradeWind2 5/11/08
I take issue with the comments that the date code is "intentionally cryptic" and placed on the inside wall of the tire. First of all, there IS NO inside wall to an unmounted tire! The code is placed on the presumed inside wall because we consumers want the prettier side to show. It's an aesthetic choice, not one that is designed to obscure. We put tags on the inside of our clothing for much the same reason. More, did it occur to anyone that it would be in the US tire industries' interests to support a 6-year age limit if it were necessary? They'd sell more tires! Going along with an arbitrary expiration date is exactly what a company who valued money over safety WOULD do.
Posted by: liz 5/11/08
Interesting piece
Posted by: Stormins 5/10/08
The biggest cause of tire seperation is under inflation. The story does not mention what happens to a tire that has been sitting in a rack for up to ten years to make it unsafe. Most tire deterioation is due to direct ozone or sun exposure, and sitting for long periods of time on bare ground. Why would a tire in a enclosed building on a rack just go bad?
Posted by: uscjoe1941 5/10/08
What about the tires on new vehicles purchased at dealerships? Now I am going to have to look at Mom's 1 year old KIA Sorento..it has Michelin tires that are already bad after not even 2 years. I think everyone with a newer vehicle should check the date codes on their tires too. Too bad the story didn't cover tires on new vehicles as well.
Posted by: cherylholmes 5/10/08
After watching the show I decided to check my "new" tires I had purchased last fall. Turns out I had nothing to worry about. I bought those tires from a dealer. I purchased the tires in the 42nd week of 2007. According to the DOT number all 4 of the tires were manufactured in the 17th week of 2007. So my "new" tires really are new. They were made just 25 weeks before I purchased them. Needless to say I am pretty happy with this knowing that my local Dealer was not stocking old tires.
Posted by: Skyb1rd 5/10/08
Unfortunately there seems to be a misconception that old out of date DOT# tires are sent back to the manufactures to be broken down and reused to make new tires. These tires cannot be put in new tires but ground up and used in rubberised asphalt and in outdoor play areas. The steel is stripped from the tires and recycled. As a retailer of new tires I reject older DOT # tires. It is most likely stock that has been in a Wholesaler's Warehouse and not rotated properly out of stock.In the southwest and southern states where heat and underinflation is the key to most tire failures we find that poor maintence is the major cause of most tire failure not age. It should always be up to the consumer to educate themself's in any purchase. Most Independent Retail Tire Dealer would gladly inspect and help consumers decide if a new tire is needed. In the year 2000 Firestone was subjected to recall on tires installed on Ford's Explorer and during this recall we we pulling tires off the Explorer that were 10 years old and still had half the tread left. We are now as consumers being told that we are not responsible enough to check our air pressure in the tires on our own cars and suv's and light trucks that our federal government has mandated that all of these must have Tire Pressure Monitoring Systems. This adds to the cost of any new vehicle and the service that needs to be done thereafter. Simple maintenance and checking your tires air pressure at least once a month will add to the life of you tires and to the safety of your families. In a nutshell the age of the tire is important but proper maintenance is crucial to tire life and safety.
Posted by: giddens 5/10/08
The number 1 cause of tire failure is underinflation, not age. The number 1 cause of underinflation is owner neglect. if people would just check their air pressure once a month, tire age would not be a story on 20/20. People would get improved fuel economy and their tires would last beyond the tread wear warranty. This is a proven statement of fact. Remember, you are the key to your vehicle's safety. Open your glove, pull out the owners manual and read it. Most people have no idea what kind of info is in there.
Posted by: navstargps 5/10/08
After watching I went out to check the tires on my 2007 Ford Exp. Sport Trak and found the number they describe on the show to be MISSING the area is there the circle so to speak BUT NO NUMBERS WITHIN IT! That scares me. Am I to buy 4 new tires?
Posted by: kpsnip 5/10/08
Where are the statistics on number of accidents directly related to failures of 6 year and older tires? Where is the analysis and research that went into the British study quoted? Is a personal injury lawyer the technical expert? Interestingly you focused the camera twice on separated treads on the side of the highway implying they were from six year old tires. They were not. They were clearly separated truck retreads which are all over the highways. This is clearly unsubstantiated, misleading reporting.
Posted by: Ted.R 5/9/08
I have 1961 MGA with Michelin X tires on it. The tires were installed in 1970 and currently have about 50,000 miles on them. That's 38 years folks! None of the tires have ever had a flat nor have they gone flat in storage. I just had the car out on the backroads of Oregon at 55 mph. Tire too old at 6 years? Make no sense whatsoever to me. Where the data that shows tires fail? Is it consistent across brands?
Posted by: Barkdust45 5/9/08
hamdave, It has been found that under-inflation has caused a lot of tire failures in the past. Everyone, go out and inspect your tires, make sure they are properly inflated, and check the tread. and if they are heavily weather-checked, then take care of it. This is a maintenance issue. I still want to see lab test results of unused tires stored correctly as compared to recently manufactured new tires. The technology exists to do that. Then and only then will I be convinced that ABC 20/20 is doing a public service with this story.
Posted by: northwoodsbug 5/9/08
I have a vintage sports car with Michelin tires which are now 37 years old. Yes, 37 years and about 45,000 miles. I just had the car out and the tires are just fine. It seems to me that someone is trying to increase sales. There must be something more serious/real to investigate!
Posted by: Barkdust45 5/9/08
Note that the date code (which will start DOT)will be branded into only one side of the tire, the other side will have all the letters and stuff that tell where and so forth the tire was made, but a blank space where the number would be.... The big issue here is that while tires do not age as fast in a cool dry warehouse, they do age and once on the vehicle no way to tell how much of that age was on the vehicle. Not as big an issue in northern areas, but here in southwest Florida tire age fast.I have been told by several tire outlets that Florida has a law making it illegal to repair a puncture in a tire over 5 years old. Unless a tire is a very odd size there is no excuse for it to be in stock for more than a few months, Just poor inventory management.
Posted by: kozynferg 5/9/08
Selling an 'old' date coded tire is 'criminal'. Those of you who don't believe may have never had a blown out tire at high speed, it can be quite devastating to your health, much less the equipment vehicle the tires are mounted on. The age issue is because tires will eventually dry out. On a passenger car where you will drive it about 12-15K miles a year, you will normally wear the tire out before the date issue is a problem IF you got relatively new ones to begin with !! There are statistics that show that older dated tires are MORE hazardous and have a greater tendency to have catastrophic failure.
Posted by: hamdave 5/9/08
The six year age limit recommended by automakers, according to the way I read this article, must have an assumption here....the tires are already mounted on a vehicle and need to be replaced after six years. Right? Anyone with a camper knows what happens to tires even if the camper is used once a year...the sun and its UV rays, plus the heat dry them out and they become checked. Now, please tell me why the condition of these above mentioned tires are the same as tires that have been warehoused, out of the sun and drying elements of outside air, and never used? In order to be convinced that this is a real problem, I would like to know where are the data that supports tire deterioration over time when the tires are warehoused, stored out of the sun's rays and out of the ambient temperatures of a parking lot? Tires are not bananas with a shelf life based only on age. I want to see real scientific tests on the physical properties of tires, newly manufactured, older tires within the "age limit" and tires properly warehoused older than that. One commenter brought up the issue of money...think about it folks. Who would make money if all unsold tires older than 6 years were to be taken off the market, shredded, recycled and mixed into new tires, and sold to you at the going price now that oil is over $120? Tire companies would make out like bandits...not having to pay for the raw materials, but the consumer pays the full price as if they were completely new!
Posted by: northwoodsbug 5/9/08
There should be a label that shows DOT xxxx. The first two digit is the week it was made and the last two are years.
Posted by: makattack4000 5/9/08
This is nothing more than just fear mongering - is there some validity to a dried-out tire and potential performance issues? - absolutely. But suggesting that ALL tires beyond their "expiration" should not be sold is just plain ridiculous. I think we have bigger fish to fry then to worry about something like this.
Posted by: cpurvis 5/9/08
Check the long string of numbers on the side of the tire. At the end of that string will be four numbers. The first two are the week the tire was manufactured and the last two are the year. For example, if the number is "2604". Tire was manufactured the 26th week of 2004. Good luck.
Posted by: Mystic_Redcat 5/9/08
I feel I need to comment here: First of all, the automotive industry has a six year limit, because I assume that the tires in question are mounted on the vehicles and are in use. Anyone with a camper stored outside in the sun knows that the sun and its UV rays do the most damage on tires, used or unused. Parking a car all day in the lot at work or at the mall...not only lots of sun, but heat from the asphalt. Now, how is a six year old tire in use the same as an unused tire stored in a warehouse...most of them are kept dark. I would like to see the scientific analyses of the physical properties of older unused tires compared with the same properties of newer unused tires and of course, tires that have been mounted on vehicles, even if they are not driven except to go to church on Sunday. I don't think safety is an issue as much as this article leads me to think. Just think of the money to be made of all tires older than the requisite six years have to be shredded, the rubber contents recycled, mixed back into to make more tires, and then, tah tah, sold as new at the inflated price now that oil is $120 plus.
Posted by: northwoodsbug 5/9/08
This is why it is best to buy direct!! Some people wont wait and will go to a store and buy what ever they have not thinking those tires have been there as long as the store sometimes. Especially if its and uncommon tire size. Low profiles are the worse when you buy them in a store. Just look before you buy as you should would everything you spend your money on....
Posted by: invisible099 5/9/08
I just ordered a set of Goodyear tires...how do I read the code on them to know their 'best before date' ? ABC, please tell me!!
Posted by: desmond222 5/9/08
Anything to make money. That is WalMarts stand and any other Stores stand that puts the safety of its customers below there bottom line.
Posted by: fastiger13 5/9/08
I'm just positive the store management lies awake at night, every night, worrying about the safety and well-being of the people who purchase their products.
Posted by: kgainer2334 5/9/08
Gosh, this is such a travesty. Come on, investigate some real issues for a change.
Posted by: AVGWarhawk 5/9/08
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Fix It Yet Again Tony
June 11, 2009
The world’s most often rescued automaker has officially been rescued again as Fiat, makers of semi-reliable autos, wrapped up its semi-purchase of ailing Chrysler.
Chrysler will surely benefit when Fiat rebadges its popular Euro gas-sippers and ships them here. That will be a refreshing change from Chrysler’s current line-up of cars and light trucks that share the same look…and gas-gobbling qualities.
Fiat, in return, will get….well, no one is quite sure. Probably not even a hemi. Oh, sorry, it gets a 20% share in Chrysler. Some 55%, though, will be owned by Chrysler’s UAW Retiree Medical Trust, 8% will be held by U.S. taxpayers, and the Canadian taxpayers get 2%.
And if it the marriage doesn’t work out, Fiat can pick up and leave anytime it wants. Sweet!
New Chrysler/Fiat CEO Sergio Marchionne, offered these words, which should make any taxpayer shiver: “We intend to build on Chrysler's culture of innovation and Fiat's complementary technology and expertise to expand Chrysler's product portfolio both in North America and overseas.”
The last time we heard such hopefulness, all we got was the K-car.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Guess Who’s in Your Wallet?
June 11, 2009
With summer near, gas and diesel prices are on a sharp upward path once again.
Though hardly has awful as last year – $4.25-$5 per gallon reported in mid-2008 – consumers and truckers are screaming as gas is hitting $2.80 and diesel pushes $2.60.
And who is pushing the price buttons? Same as last year….oil speculators. You know, rich people placing high dollar bets on the price of crude. Oil, which reached an absurd high of nearly $150 per barrel last summer and came back to the mid-$50/barrel range earlier this year, vaulted above $70 per barrel in early June. Some experts say $3 per gallon gas is coming our way, as traders play games.
Finally, there are some groups taking up the fight. Nearly 80 consumer and business groups – including the American Trucking Associations and consumer groups – are taking it to Capitol Hill, calling on Congress to rein in oil speculators – and all commodity traders.
Here is the funny thing…much like our banks and mortgage houses and insurance giants, the entire commodity speculation arena is barely regulated! Who’d have thought?
“Absent strong and sweeping reform, we will continue to witness extreme price volatility and excessive speculation,” said a letter to Congress from The Commodity Markets Oversight Coalition. “Trading will continue to grow in 'dark' or unregulated markets and investment speculators will continue to elude federal oversight, data reporting requirements and position limits.”
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Keep Eye on the Flu Bug
June 11, 2009
Planning to go somewhere this summer? May want to rethink that plan.
The World Health Organization (WHO) is on the verge of declaring the first influenza pandemic in more than 40 years.
You’ll remember that whole swine flu thing, which was front-page news for weeks back in April – until we got distracted by…what was that again? Anyway, after we stopped paying any attention, thousands upon thousands of new cases of H1N1 popped up all over the place.
WHO has a six-position scale of severity for outbreaks of diseases. Sort of like a Richter scale for germ- and bacteria-borne illness. Well, right now it’s sitting at 5, and the WHO is ready to go full red alert.
North America – particularly Mexico – has been hardest hit. Australia now has more than 1,000 cases. China is believed to have been hit hard, though there are no official reports. Japan is battling pockets of flu outbreaks. In all, the H1N1 virus has hit more than 26,500 people in 73 countries.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
You Can Call Him Doc
June 5, 2009
Big kudos to USW International President Leo Gerard, who is receiving an honorary doctor of laws degree from the University of Guelph next Thursday.
A native Canadian and son of a union miner, Gerard started working at nickel smelter in Sudbury, Ontario at age 18. He rose through the ranks to now lead one of North America’s largest labor unions.
Argue as you will about his tactics and incendiary pronouncements, but a honorary doctorate from one of Canada’s leading universities is nothing to sneeze at.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
And They’re Off…
June 9, 2009
Speaking of the USW, as of June 8 all of the Big 3 tiremakers will be in formal master contract negotiations with the union.
Goodyear and the USW started their meetings on June 1 in Cincinnati, and with Michelin talks began the same day in Lexington, Ky. Bridgestone and the union begin their talks Monday in Louisville.
While a bumpy ride is not expected, one never knows.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Boing, Boing
June 5, 2009
So when GM dropped the bankruptcy bomb on June 1, the Dow Jones Industrial Average dropped GM.
Once the second longest tenured of the 30 companies on the DJIA, GM was bounced – along with Citigroup – in favor of Travelers and Cisco Systems. GM had been on the board continuously since 1925, just behind GE, which had held its spot since 1907.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
New Author
June 5, 2009
Tire Review contributor Hank Inman finished his first book – Rubber Mirror – now available through the University of Akron Press.
The 287-pager is a well-researched history of the Rubber Division of the American Chemical Society, which is celebrating its 100th anniversary this year.
As a history, Rubber Mirror is a great read. Pick one up through www.uakron.edu/uapress.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Pot, Kettle…You Get the Picture
June 3, 2009
This is a long one, so saddle up.
On Monday, the well-read Huffington Post blogsite carried an opinion piece from Leo Gerard, president of the United Steelworkers, who waxed poetically about the importation of passenger tires from China.
As you know, the USW has filed a complaint with the U.S. government seeking sharp limitations on these imports, complaining…well, I’ll let Leo explain before I go on. Here is his blog offering from Huffington Post:
Chutzpah and Cheaters Partner to Keep American Tire Workers Unemployed
Leo W. Gerard
President of the United Steelworkers International
A group of tire importers that should be competitors banded together recently to ally themselves with China in a trade case.
Doesn't sound like they're working for the interests of the United States, does it? No, they're not. They're collaborating with China against American manufacturing in general and American tire workers, represented by the United Steelworkers, in particular.
They're opposing the union's petition seeking a limit on the flood of Chinese tires that has so overwhelmed the U.S. market in the past five years that six American tire plants closed and nearly 7,000 American workers lost their jobs.
China cheats in international trade. It does so by manipulating its currency and subsidizing its manufacturing, which results in lower prices for its exports. For the tire importers, calling themselves the American Coalition for Free Trade in Tires, China cheating means higher profits.
After taking up with China, these companies are not the American Coalition of anything. They're the Chutzpah Coalition. Here's the quote that explains why: "If you impose quotas, you harm American jobs because of the impact on all of the people that work for independent dealers." The Chutzpah Coalition lawyer, Jim Jochum of Jochum, Shore & Trossevim had the lack of insight to say that.
What we have here are tire import companies that grew and profited at the cost of American tire plants and American workers now asserting that if they are forbidden from importing limitless tires, then the result will be terribly wrong and unfair because some of their importing jobs might have to be cut.
If imports are limited, preserving thousands of American tire workers' jobs, here's what Del-Nat president Jim Mayfield asked at the Chutzpah Coalition press conference, "What's supposed to happen to my company and my workers?" A call to Del-Nat asking for the total number of employees got this response: 68.
That's chutzpah.
For those unfamiliar with Yiddish, chutzpah is not generally considered a positive attribute. The typical definition goes something like this: A boy kills his parents then seeks the court's mercy because he's an orphan.
In dealing with the Chinese and this coalition, there's reason to believe chutzpah can be deadly. Chinese manufacturers are notorious for cutting corners in ways that proved lethal to consumers. Babies, cats and dogs have all died from melamine-laced milk and pet food from China. In another case, the Chinese manufacturer of Aqua Dots substituted a chemical, which when ingested reacted like the "date rape" drug, forcing a recall of the toy after it sickened American children who put the dots in their mouths, and caused at least one youngster to end up in a coma.
And then there's the tire case. On Aug. 12, 2006, four Philadelphia carpenters were driving home after work when the treads on one of the Chinese-made tires on their van separated. The rollover crash that followed killed two of the men and permanently impaired a third. An investigation showed that the tires, imported by Foreign Tire Sales – one of the members of the Chutzpah Coalition – did not contain a gum strip between belts necessary to prevent tread separation.
Initially, when the National Highway Traffic Safety Administration ordered Foreign Tire Sales to recall the defective tires, the company said it couldn't afford to do that. Foreign Tire said it could pay only 10% to 15% of the approximately $80 million cost of recovering nearly half a million tires. Sure, it could profit from importing defective products. But it wasn't prepared to pay to clean up the mess.
Later, it decided that only 255,000 tires needed to be returned. Ultimately, Foreign Tire was spared when drivers turned in fewer than 20,000 of those tires – less than 8% of the total. Who knows what happened to the remainder of those questionable tires or the people driving the cars they were on.
Foreign Tire, the Chutzpah Coalition and China want to continue importing freely – free trade not fair trade. And Chinese officials have taken steps to ensure that happens. Early in May, according to a report in the People's Daily, China's Vice Minister of Commerce met with U.S. Embassy personnel in Beijing "to negotiate on two trade remedy investigations targeting Chinese-made products that U.S. industries recently filed with the U.S. government."
After that, the International Trade Commission released a memo revealing that Chinese officials attempted to discuss trade cases in a private meeting – a contact that was improper because other parties in these cases did not have an opportunity to argue their side. The ITC memo said China expressed particular concern about petitions filed under Section 421, the China-specific trade safeguard law that the USW used in the tire case.
Here's what is at risk for China and their Chutzpah Coalition allies: in 2004 China sent 14 million tires to the U.S. valued at $453 million. By last year, that had increased to 46 million tires valued at $1.7 billion.
The USW wants the U.S. International Trade Commission to limit the imports to the 2005 level, which was 21 million. That number then could rise by 5% the following year, and 5% more the year after that.
Congress added Section 421 to the U.S. Trade Act in 2000 to give U.S. industries and workers an opportunity to obtain product-specific relief from sharp increases in imports from China. Section 421 could provide resolution more quickly than a dumping or countervailing duty case.
Another good reason to call this group of tire importers the Chutzpah Coalition is that in its news release, announcing its formation, it suggested it represented "thousands of Americans working in the tire industry." Not likely. Two of the six members refused to say how many employees they have – Dunlap & Kyle Co., Inc. and Foreign Tire. But the total employed in the U.S. for the other four together: American Omni Trading Co.; Del-Nat Tire Corp.; Hercules Tire & Rubber Co. and Orteck Global Supply & Distribution Co., is 400.
That's hardly "thousands of Americans."
But they've cost 7,000 Americans their jobs. And they're fine with that. They're working hard every day to add more to that number.
OK, now that Leo has had his say, I want to make a few points – once again.
Before I get started, I do want to say that retaining American manufacturing jobs is important. Producing your own goods helps any economy. But times have changed, while expectations have not. Retaining manufacturing jobs “just because that’s how it’s always been” makes no sense, especially when those jobs result in uncompetitively priced products. Those are not sustainable jobs. Those are jobs just because, and that is equally bad for the economy.
Now, to the teeth of Leo’s argument: The importation of China-produced passenger tires has directly resulted in the closure of six U.S. tire plants and the loss of 7,000 jobs. This is important because certain members of Congress drank the USW Koolaid and repeated these same figures to both their constituents and to the ITC.
As I stated in an April 22 blog item (scroll down to “Another Vague Argument”), those plant closures he mentions had little to do with the influx of China-made tires. Rather, they were the product of tiremakers wanting to retain production of so-called “high-value tires” (which translates into “higher tech, higher priced”) on these shores while pushing the production of so-called “broadline” tires to low-cost countries…like Mexico, China, Eastern Europe, etc.
In two of the USW’s cited plant closures, the plants were shuttered because the union would not come to terms with the fact that bloated wages and benefits were a drag on profits – it cost too much to make the tires here. In another case, the USW negotiated and accepted the closure as part of its master contract agreement. In yet another, the plant in question wasn’t even union represented.
And then there is today’s economy, one in which new tire sales are dramatically down, high-value tires are not delivering high-value profits, and those consumers who are buying tires are (despite what some tiremakers want to claim) looking for the lowest cost, not the best “value.” Fewer tires are being sold, and those that are tend toward the lower ticket end of the sales spectrum.
Even more troubling is that Leo and his followers take aim against a group of importers – the American Coalition for Free Trade in Tires – but fail to even glance into the mirror.
Again, as tiremakers shifted production of low-value tires to low-cost countries – including China – those same companies were among the largest importers and sellers of China-produced tires. But Leo doesn’t even mention that fact..because it doesn’t make for good press. Cooper, Bridgestone, Goodyear – they all produce tires in China that end up here. Conti just got going on its first Chinese plant, so they are off the list. Michelin claims that the Warrior brand tires it produces never make it to these shores, but…
Regardless, the union cannot have it both ways It cannot rail against Chinese tire imports while turning a blind eye to its role and its seeming benign acceptance that its employers are among the “offenders.” Now that’s chutzpah.
So the USW wants its cake – and the way they want it decorated – and they want to eat it too. They want high paying union jobs with companies like Goodyear, Michelin, Conti, Bridgestone and Cooper – now conveniently lumped together as “American tiremakers” – but they apparently don’t want those same companies to be competitive.
The USW demands a three-year quota system, rolling allowed imports back to 2005 levels with 5% annual increases over the following two years. Why three years? Why not five or 10 or forever? What will be different in 2012? Will the USW come begging at the table in 36 months?
Leo and his crew are betting on a Democrat administration and Congress to take his side. Note that growing Chinese tire imports has been an issue for more than the last six months, but the USW wasn’t going to raise the matter when the GOP was in charge.
At the end of the day, a lot more China-produced tires reach our shore today than in 2004; that is the state of the market. Has the influx of China-produced tires resulted in the loss of some union jobs? Probably, but not 7,000 or 5,100 (depending on which number Leo is using today). Not even close.
All anyone should want is for the Congress and the ITC to start asking the hard questions, the potentially unpopular questions, of the union and its supporters. The fact is, China and Chinese tires are not the blame or the problem. The real problems run much deeper, and the union needs to take a good look in the mirror and consider the role that it played in this issue.
If those questions aren't asked, then who really is cheating?
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
The Trouble With Normal is it Always Gets Worse
June 1, 2009
“When things get back to normal….”
That’s a phrase I hear often lately – from dealers, analysts, tire companies and colleagues – usually connected with tire and new car sales.
The core assumption bothers me quite a bit. Just what is or was normal? And given the body of evidence before us, how can anyone assume that “things will get back to normal”?
Normal, I guess, means America will return to its voracious appetite for new cars, and that “pent up demand” for replacement tires will burst the dam and vault us back to the “good old days” of 230 million-plus replacement shipments.
Frankly, I doubt that will be the case with vehicle sales. Tire sales may reach pre-recession levels in a few years time, but I think you can throw away any of those growth charts you’ve been sitting on. There may be some pent up demand, but it isn’t as large as anyone wants to believe, I think.
I have read many articles from various sources, and they all tend to say the same thing: Much like our grandparents’ experiences coming out of the Great Depression, Americans are learning – and living with – a new financial mantra. I expect that when we regain some order – and there are signs that we could be edging that way – I don’t expect a spending frenzy or a return to the kind of conspicuous consumption that we all enjoyed through the 1990s and 2000s.
I suspect that Americans have learned to do without, and do with less. I see a world where credit cards become far less important, where consumers carefully weigh (and save for) purchases, where smaller, more fuel-efficient vehicles will rule the roads, and where America’s long-time love affair with the car comes to a close.
And this consumption reevaluation will spread to all manner of product categories…food, clothing, electronics, services, vacations, etc. In other words, the retail and service sector shakeout will continue for a few more years. Unabated consumption is old school; frugality will be the new normal.
I could be wrong, but that’s the writing I see on the wall today.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Welcome, Canada!
June 1, 2009
The Financial Post told me today that Canada is officially in a recession.
Now before you go all “Where have they been” on our friends to the north, it’s important to note that Canada was relatively unaffected by the core of our financial meltdown – the house of cards that was our housing and investment markets. Their banks and investment houses didn’t jump on the greed wagon, and Canadian home buyers weren’t leveraged to the teeth. Smart, eh?
But, try as it might, Canada cannot totally insulate itself from the sins of others, and that carry-over from the States and Europe has finally poured over the country.
Said FT today, “Statistics Canada will be reporting gross domestic product for this year's first quarter. It's expected to show the second consecutive annualized decline in GDP, meeting widely accepted criteria for a recession.
“Not only is another economic contraction thought to have happened during this year's first three months, it's believed to have been a doozy. Analysts polled by Reuters had a median estimate of a 6.6% decline in 2009's first quarter, which would be the biggest drop since record keeping began in 1961.
“That would follow a 3.4% economic contraction in 2008's final quarter.”
But Canadian analysts say they expect the Canadian economy to start growing again in 4Q 2009. So much like GM’s bankruptcy, Canada’s recession will only last a few months. Same as the Stanley Cup playoffs!
A key indicator, though, is Canada’s unemployment rate, which is expected to hit 8.3% with the upcoming May report, and that doesn’t help. U.S. job losses are expected to be announced this week, and most expect the jobless rate to jump from 8.9% to 9.3%. Ouchie!
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
“A Yellow Light Means….”
June 1, 2009
As drivers, 20% of you flat out stink!
At least that was the finding by GMAC Insurance’s annual survey. According to the study, 20% of American drivers would not pass even a basic driving test today.
I think most of them live near me.
No surprise here – older drivers (regardless of sex) tended to do worse.
Why? Well, with few exceptions, most American drivers haven’t taken a legit driving test since they got their licenses. A lot has changed since those bygone days – for me it has been 34 years – so what we thought knew then doesn’t hold today.
Still, spend 5 minutes on any Ohio freeway and you’ll discover that test knowledge is the least of our problems.
Meanwhile, you might want to have your staff take – and pass – updated driving exams. You might be able to save some insurance money!
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Another Side to Safety Inspections
May 29, 2009
Got a number of letters and comments about my May 2009 column concerning the value of safety inspections to independent dealers in these tough times. And while I stand by my basic premise, a few of you are quite right to suggest that such so-called “courtesy inspections” can also become the expressway to business hell.
Here are two notes I received, from people whose opinions I respect:
Jim...
While I respect you and you are on the top of any list, why such an editorial on safety inspections? We have been doing this since I became a tire man in 1969. Just like checking the air on all of the tires and including the spare. I don't get what's the big deal. I guess that's why we are busy.
Thanks and chat with you soon.
Alpio Barbara
President
Redwood General Tire Service
Redwood City, CA
When I was in the field, just before Bridgestone and Firestone merged, I got to see, first-hand, exactly what PMAs taken too zealously can do to a business. It does not work out like Bill Ihnken describes. That I know for certain. Saw it first-hand!
Maybe the ghosts of Pete Johnson and Lindsay Vaughn have returned in the likeness of Bill Ihnken. Instead of this company store operation, they work at that company store operation.
Pete, Lindsay and others preached the same mantra. It sounded so damn good. It was a miserable failure. Here's how and here's why...
1. Customer comes in for a simple oil change. Not another car in any bay right now. Tech drives it in to the bay and starts off taking off the lug nuts. Thirty minutes later the customer, looking out to see his tires off, brakes being inspected, asks how much longer and what are they doing to my car. The guy behind the counter says they are doing a courtesy safety inspection. It will be about another 20 minutes. So, here's how you run off the customer for good. About one hour into a 15-minute oil change, the tech brings a laundry list of stuff, in priority order just as Ihnken describes, to the counter for the sales guy to sell. In regular P.C. Johnson format, the tech calls the oil change customer over, who is expecting a $29.95 bill, and presents a list of suggested services. The shocks and struts are critical ($680) or you'll wear your tires and front-end parts out. The belts need replacing right away ($180). Those things need to be done now. The other, less critical things are: rear brakes are close to replacement ($600), radiator fluid needs to be flushed and filled ($120), battery guards need to be installed ($26).
If the customer buys this, it will be the last time they do it. Their expectation was to spend $29.95, not $900. If they don't buy it, you still lost them because you wasted their valuable time.
2. Put it on the card. Old Pete used to really appreciate when his guys opened up new credit cards and maxed out the limits all in the same day. The top guys always ate steak at the weekly meeting, and they ate first. Others ate beans. Bring 'em in, get the car for the day, inspect the heck out of it. If it was a woman, they'd scare the crap out of them with safety stuff. Pressure buying. Credit card maxing.
3. After a while of #1 and #2 being done, you start to see less of #1 and #2. Word gets around. Those guys are looking hard to sell you stuff you didn't even ask for. You get a reduction in car counts. And you push harder on the next guy. And so it goes. The snowball grows bigger.
Yes sir, the future looks mighty bright for TBC Retail.
The obvious problem is how to solve the resulting drop in car counts. And that is look for only obvious and related simple things. If a guy comes in for an oil change, he gets a free 21-point inspection or a mini-PMA under hood. Just like what you'd expect at a fast lube. No tires off, no brake inspection. You can add on $35-50 per car. Not so bad. But adding on $245 to an oil change is trouble. It's the Bill Ihnkens and Pete Johnsons that really give our industry a black eye.
Steve Hutchinson
Vice President of Marketing
Toyo Tire USA Corp.
Cypress, CA
I agree with Steve’s assertion that an out-of-control PMA program is doom. Strange as it seems, the day after I got Steve’s note, our friends at Canadian Technician magazine talked about the same issue, and repair shop owners provided a lot of similar feedback.
So I guess the issue is this: restraint and control. A simple 21-point program, a written report with timeframe recommendations, and far, far better customer education is the way to go.
The real problem, perhaps, is that most consumers don’t know boo about cars or tires, so when a $29.95 oil change suddenly becomes a recommendation for $900 in service work, the customer is left with a bad taste in their mouth. The list of recommended service may well be correct, but if its not presented properly the customer is thinking “rip-off” and not “safety.”
I just went through multiple repairs on a few of my vehicles. We go to a local tire dealer, and his guys do a great job with courtesy checks. While this was not a case of a $29.95 oil change gone wild, I did end up with a laundry list of issues that needed attention. We went through the list together, prioritized the work, and moved forward.
If you have a take on this question, we’d love to hear from you too. Drop me a note at jsmith@babcox.com.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Bottom of the Barrel
May 29, 2009
Earlier this year, I told a group of tire dealers that oil prices would stay down in the $50 per barrel range, keeping gas prices in that $2-$2.20 per gallon area.
And I was right…until Memorial Day weekend when oil went into orbit ($65 a barrel) and gas looped to $2.60 a gallon. Not good for already tight wallets!
Apparently OPEC thinks it needs $75-$80 a barrel to be comfortable, and any sign of improvement in our economy is seen as opportunity to push the prices higher.
As our friends at the Heavy Treadin’ blog put it, the rise in oil prices is killing the already fragile trucking industry. For April, truck tonnage was down 13% year-over-year…and that was against a crappy April 2008. Businesses everywhere (including the tire biz) are cutting production and rationalizing inventories, which means less trucks are moving less goods from the factory to the warehouse.
“So, the trucking industry is getting walloped, because physical inventories are way too high,” writes Heavy Treadin’. “Common sense will tell you that this will have a proportionally bad effect on the tire industry. Standard, class 8 semis need 18 tires to run. Less tonnage means less wear on existing tires, with a decreased chance for tire failure. In addition, it means that we will probably see an increase in deadheading, where the tractor makes the trip home without hauling any cargo. Again: No trailer = less wear.
“With crude prices nearing $65 a barrel, and diesel on the rise, some truckers may just opt to stay home. Demand is already at anemic levels. A modest increase in travel could send fuel prices soaring above that mark. The high cost of fuel may begin to eat into what little discretionary income people have left. When it does, you can expect the products on the shelf to stay there even longer, worsening an already bleak picture.”
Well said.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Twitter, Tweets and Twits
May 28, 2009
I am amazed at how ga-ga Americans are over Twitter. Of course, we do love our shiny objects.
Many media and advertising groups rave on and on about how so-called “social media” is the big game-changer now, where e-services like Twitter and Facebook and MySpace are the great new frontier for promoting business and brands.
Perhaps, but (and maybe I am old-fashioned) I have failed to be so convinced. Just how does one leverage such social media to benefit your business? We’re told it will, but details remain highly sketchy…and never deal with B2B. Sure, I can see soft drinks and music and apparel – common consumer brands – benefiting from social media buzz. But just how does that work when one business is trying to sell to another?
Don’t know. This is what I do know, though. In recent weeks a number of companies and individuals have gotten their you-know-what caught in the wringer over their Tweeting. Apparently they didn’t get the memo that Twitter and Facebook and MySpace posts are not private communication. You know, like phone calls and secret meetings in restaurants.
Worse yet, when ad agencies sell their clients on using Twitter vs. proven conventional means to promote products and services in the B2B arena. I have an armload of e-mails from agencies announcing that their clients would be Tweeting “live” from such and such event. As if potential customers have the time to monitor such things…140 characters at a time. Come on.
Confession time: Tire Review is participating in social media. We have a group on LinkedIn, a social media site for business pros. We’re are carefully watching participation to gauge whether there is a real benefit, or if such activities are just wishful thinking. If it proves to be the latter, we’ll be moving on.
Meanwhile, you may want to carefully watch the social media activities of your staffs lest they post anything that can harm your business. They may plead that you are invading their privacy, but public postings can hardly be considered private. It is, after all, your business.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Out of the Mouths of Dimwits
May 28, 2009
I have no idea if this is legit. Frankly, it doesn’t matter cause they are just too funny.
According to the e-mail, these lawyer-witness exchanges are from a book entitled “Disorder in the American Courts.” While it is easy to say that some court players are none too bright, it is often the well-educated lawyers who prove to be dim bulbs.
ATTORNEY: What was the first thing your husband said to you that morning?
WITNESS: He said, 'Where am I, Cathy?'
ATTORNEY: And why did that upset you?
WITNESS: My name is Susan!
****
ATTORNEY: This myasthenia gravis, does it affect your memory at all?
WITNESS: Yes.
ATTORNEY: And in what ways does it affect your memory?
WITNESS: I forget.
ATTORNEY: You forget? Can you give us an example of something you forgot?
****
ATTORNEY: Do you know if your daughter has ever been involved in voodoo?
WITNESS: We both do.
ATTORNEY: Voodoo?
WITNESS: We do.
ATTORNEY: You do?
WITNESS: Yes, voodoo.
****
ATTORNEY: Now doctor, isn't it true that when a person dies in his sleep, he doesn't know about it until the next morning?
WITNESS: Did you actually pass the bar exam?
****
ATTORNEY: The youngest son, the twenty-year-old, how old is he?
WITNESS: He's twenty, much like your IQ.
****
ATTORNEY: Were you present when your picture was taken?
WITNESS: Are you @$&%#ing me?
****
ATTORNEY: She had three children, right?
WITNESS: Yes.
ATTORNEY: How many were boys?
WITNESS: None.
ATTORNEY: Were there any girls?
WITNESS: Your Honor, I think I need a different attorney. Can I get a new attorney?
****
ATTORNEY: How was your first marriage terminated?
WITNESS: By death.
ATTORNEY: And by whose death was it terminated?
WITNESS: Take a guess.
****
ATTORNEY: Can you describe the individual?
WITNESS: He was about medium height and had a beard.
ATTORNEY: Was this a male or a female?
WITNESS: Unless the circus was in town, I'm going with male.
****
ATTORNEY: Doctor, how many of your autopsies have you performed on dead people?
WITNESS: All of them. The live ones put up too much of a fight.
****
ATTORNEY: Do you recall the time that you examined the body?
WITNESS : The autopsy started around 8:30 p.m.
ATTORNEY: And Mr. Denton was dead at the time?
WITNE SS: If not, he was by the time I finished.
****
ATTORNEY: Are you qualified to give a urine sample?
WITNESS: Are you qualified to ask that question?
****
ATTORNEY: Doctor, before you performed the autopsy, did you check for a pulse?
WITNESS: No.
ATTORNEY: Did you check for blood pressure?
WITNESS: No.
ATTORNEY: Did you check for breathing?
WITNESS: No.
ATTORNEY: So, then it is possible that the patient was alive when you began the autopsy?
WITNESS: No.
ATTORNEY: How can you be so sure, Doctor?
WITNESS: Because his brain was sitting on my desk in a jar.
ATTORNEY: I see, but could the patient have still been alive, nevertheless?
WITNESS: Yes, it is possible that he could have been alive and practicing law.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Lost on the Wreckage
May 15, 2009
I have never been sure what to make of the story of Tire Works Total Car Care, the Las Vegas-based dealer that is facing deceptive trade practice charges by the Nevada attorney general.
On the face of it, the charges and supposed proof seem rather thin. I saw the written transcript of the local TV station’s expose that inflamed the situation. There was very little substance there. Believe me, between the consumer media and some of our own industry press, Tire Works has been drug well through the muck and mire.
Do they deserve that kind of treatment? Well, I guess that is subject to debate. We have intentionally avoided the entire affair because all of the information I saw on the case, as mentioned above, appeared rather thin.
And now Tire Works owners are suing the state Department of Business and Industry and a former employee (who allegedly assisted the attorney general in an undercover investigation). So you can see this will not end well.
One of the problems with consumer complaints filed with the government is that often times resolution was reached…but not reported to the authorities. Another problem comes when the customer’s version of “customer service” does match that of the retailer. You all know that happens=, and you know the result. Some customers, no matter what you do, will never be happy…and some of them complain.
Did Tire Works do anything wrong? Don’t know. Did consumers and the state overreact? Maybe, don’t know. I do know this: If the state had such compelling evidence that wrong was being done, they should simply shut the business down. Leaving it to try to eke out an existence under these circumstance is unconscionable.
Unless there is hard (and I mean hard) evidence of misdoing, the state (and the press) should not literally destroy a business in the media. What happens to Tire Works if all of the charges are dismissed or disproven? Huh? At what point does this company get to be “innocent until proven guilty”?
I don’t want us to be part of that, which is why we avoid such stories. I know they are interesting and all – and certainly there are lessons to be learned – but unless there is compelling, no-brainer evidence, I much prefer waiting until the final act is played out instead of potentially destroying someone’s livelihood. If that’s bad journalism, so be it.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
It’s Just Right, Eh?
May 15, 2009
The other day, we posted Chris Vander Doelen column on Canada’s Right to Repair proposal from the Windsor Star.
As you would expect, his May 12 column attracted comment from many readers. Well worth reading if you are pro-R2R. Here is a sampling [Editor’s Note: It is best to read from the bottom up because that is the order these comments were posted. Also, all misspellings and damaged grammar are as they appeared]:
Jaded Car Owner
First of all, Roy, you do not work at a dealership. That was just a lame attempt at discrediting dealerships. Shame on you. As to the bill itself, I support it completely. We need guys like Masse looking out for the small guy. And the small guy includes the corner mechanic trying to earn a living.
Roy
I work at a dealership and we are told not to fix minor leaks or report them, as this is warrenty work. We are to report them after the customers warrenty runs out. This way we can get paid the full amount for the repair instead of the warrenty rate which is often much lower. So is a dealership really a good place to get your vechical serviced?
Alex
Rick W, your choice is simple, just don't buy a car from manufacturers who withld the codes. That's the capitalist way. If people really cared enough about it, market forces would drive the manufacturers to release this information. The truth is most "codes" are available, it's just that garages don't have the money to buy the equipment or training. I'd bet $1 that was the case on your trip to Florida. That won't change with this new law.
ROB ROY
You wil probably void your warranty--I guess you must like playing russian roullette with your car--smarten up..
ROB ROY
IT IS JUST NOT THAT EASY.Hit a law button and this happens. This is a killer deal--Masse and the NDP love to bust the rules of free enterprise.. Chris you are a good wordsmith but you all do not know what the hell you are doing here..
RICK W
Alex I see you don't have a clue. In this new age of electronics they can have engine lights go on for the most minor or major things and only the people holding the codes will know if it is serious or minor. And with many dealerships closing, this will leave some people even in Ontario many kilometers away from a dealer .The companies have put these in there to milk us of our cash, time and right of convenience to who we want to work on our car. The dealerships have always competed with the local garages because there are some things only they can fix. By making almost everything a deal item is going to raise the cost of fixing our car and giving them a big advantage. I own a new car and only bring it to the dealer because I know they are up to date on everything, but some people would like the convenience of a garage especially if they live far from a dealer. I went to Florida last year and my engine light went on ,I pulled into a garage off the interstate , they didn’t have the codes so I had to travel 50 miles to the nearest certified dealer hoping it wasn’t serious or closed. Luckily it just had to be reset. Good work Masse!
Butch
I got wacked earlier this week by having a clutch repair on my car, done by my local mechanic. The stability control light went on, and he could not get it off. He had to take it to Honda to reflash the system, cost about 60$. This is an outright scam and for once the NDP is bang on. End this ripoff of consumers. If the companies won't play ball, make them do it for free. Good article Chris.
Communism
Now we should be told where we can fix our vehicles? OH MY GO!! This is just too out of hand now. I paid for the dang thing, it's MINE and I should be able to choose where and who will work on my car.
Ugly Kid Joe
I am all for consumer freedom but for something as complicated as todays cars I believe the dealer should maintain them. The dealer should know their cars inside out while shop xyz will need to know ALL cars inside out. Specialized versus Jack of All Trades. I trust my dealer over shop xyz. I brought my car to a local mechanic for a valve adjustment. When they were done the car was noisier than when I brought it in. Had to go back to the dealer to quiet them back down. For basic maintenance any mechanic should be fine. For things that require computer diagnostics it's back to the dealer for me.
Alex
So take away service customers from the dealerships and how will they make their money? They will have to raise prices on new car sales to make up the lost revenue. So owners of used cars get a break (theoretically) on repair costs while new car owners will take the hit. Sounds like another NDP Robin-Hood scheme to me.
Andrew
Well written article. If the manufacturers are given the freedom to with hold this information, you can bet your last dollar ( and I wouldn't do that cause you'll need it for car repairs) that dealership labour rates will skyrocket!
Tom
Excellent article and the most compelling reason I have seen in recent months to buy a GM product. Shame on any manufacturer who uses these sort of tactics to force consumers to use certain shops for repairs and maintanence. Coercion will always bite you in the butt.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Even Better Than Bartering!
May 15, 2009
At least there is some good news coming out of Congress’ latest effort to re-regulate the credit card industry. You will probably be doing a lot more cash business!
According to a Wall Street Journal story, retailer may be able to set higher prices for credit card users, supposedly to offset the ridiculously high discount rates card issuers charge per transaction.
It has supposedly been illegal to offer lower “cash prices” to consumers, but now Congress is set to return that liberty, finally recognizing that cash customers have been subsidizing the credit card industry for years. Cash customers, as one merchant told the WSJ, has been paying a penalty that only helps credit card users and processors.
We’ll keep an eye on this bill as it moves forward. Meanwhile, better start practicing making change!
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Just in Case Your Were Wondering
May 12, 2009
It’s worth reviewing (yet again) just why it is so vitally reallyextremely important for the U.S. tire industry to step up and pick adate. Find an age – 6 years or 10 years or whatever – after which atire should not be sold and/or put into service. Picking up on thenational broadcast of one year ago, this ABCNews.com story appeared onApr. 14 of this year. And these types of stories will continue toappear at regular intervals, I am sure, until we do something about it.
States Cracking Down on Sales of Aged Tires
From Hawaii to New York, states across the country are moving toregulate the sale of aged tires, which experts say can prove deadly tounsuspecting motorists. Lawmakers have credited an ABC Newsinvestigation that revealed how outdated tires, even if they appear tobe brand new, can be more prone to sudden, catastrophic failure.
"The story's impact has been very widespread," said auto safety expertSean Kane of Safety Research and Strategies. "It's probably the singlemost important story that's been done on this issue."
Safety experts warn that after six years of age the risk increases fortires to become brittle and dried out, leading to a potential tiretread separation. "It is like a ticking time bomb," said Kane. "Youdon't know what's going on inside, that's what makes it so dangerous."
California Death Leads to Calls for Action
Safety experts have attributed 139 deaths nationwide to aged tires thatfailed. Among those killed was 12-year-old William Moreno of LosAngeles, CA, whose family's SUV rolled over after the tread on an agedtire separated.
In the wake of Moreno's death, California Assembly Member Mike Davishas introduced a bill that would require tire dealers to disclose theage of a tire in writing to consumers prior to the sale or installationof a tire. Dealers would also be required to retain sale documents forat least three years, and violators of the proposed law would besubject to a $250 fine. At a hearing today in Sacramento, witnessesincluding Sean Kane and the brother of William Moreno will testify onthe bill's behalf.
In the 2008 ABC investigation, our undercover tire shoppers found tireswell over six years of age being sold by major retailers. Daviscredited the report with highlighting how consumers are kept in thedark regarding the age of the tires they buy.
"My staff member working on the bill happened to have seen it and wasinspired by it, and felt that this was an issue that she wanted toresearch and bring to the attention of the legislature," said Davis.
In New Jersey, the division of Consumer Affairs is also considering arule that would require dealers to disclose the age of tires to buyers.
'Expiration Date' for Tires
Legislators are also calling for defined "expiration dates" on tiressold. In Hawaii, a group of state senators have introduced a bill thatwould prohibit
June 30, 2009
Thought occurred to me the other day: If GM and Chrysler are cutting costs by rationalizing distribution, might not tire companies benefit from the same?
As you know, thousands of GM and Chrysler auto dealers were pink slipped recently as the bankrupt former auto giants struggled to shed debt and rebuild. Newspapers and local TV stations have been filled with hard-luck stories of long-time Chevy, Dodge, Pontiac, Chrysler, Cadillac, etc. dealers that were abruptly curbed.
One of the reasons for the dramatic reduction in retail of points of sale was oversaturation; it’s very hard to make profits if your product is available on nearly every street corner, and if your retailers are competing against one another with your product.
And the cost factor for shipping products to so many locations, managing your business within those dealerships, and supporting those locations with advertising, promotion dollars and otherwise has to be huge.
It’s little wonder any automaker can make a buck these days. Hhmmm…that sounds vaguely familiar.
With major brand names available at mass merchants, price clubs, car dealers, online, company-owned stores, chain stores an, of course, independent tires dealers, how can those brands (and their owners) make a decent profit?
One of the keys to marketing a premium product is to make it appear to be “exclusive.” You can do that with support materials, with fancy ad and PR words, and by limiting distribution – make it harder to get.
As tiremakers consider their balance sheets and financials, one has to wonder if the next wave of belt-tightening might now come from the distribution side instead of from the tire company side.
Just a thought.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
It’s Just a Matter of Time
June 30, 2009
Hey, we told you so!
In our 2007 rundown of Market Influencers (September 2007 issue), we said that “iMedia” would indeed become a major force in the tire industry.
Admittedly we were a bit premature. 2008 wasn’t the Year of the iMedia we envisioned. We weren’t wrong, just a little early.
But now comes word that the iPhone – more appropriately, iPhone apps – has found its marketer legs. And it’s time to take note, tire folks.
Dunkin’ Donuts has joined insurance giant Nationwide in developing their own iPhone apps. Nationwide’s app will allow customers to use their iPhones to make claims instantly – right at the accident scene! Click a couple of photos and send them along with the basic accident info.
And thanks to the new DD app, you can wake up and iPhone the coffee by instantly placing a to-go order at your nearest Dunkin’ Donuts. On the road? No worries – the app will find the closest DD.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Will It Go Round in Circles?
June 26, 2009
Now that NHTSA has set out its 177-page proposal on testing and grading tires for fuel efficiency – not to mention a consumer tire care education program – one can’t help but look back fondly at the early days of Uniform Tire Quality Grading, NHTSA’s first attempt at testing and grading.
Thirty years in the rearview mirror, we hardly notice UTQG. Same with consumers. But back in the day, consumers demanded to know how best to determine the relative “quality” of competing tires.
In May 1979, Tire Review published one of the first compiled lists of tire brand and line UTQG ratings. Along with that three-page rundown, then editor Bill Whitney offered some insight into the complications surrounding UTQG back then. One can see that tiremakers – and even the magazine – were confused about UTQG, but some of Bill’s comments still ring true today.
What Bill failed to mention is that UTQG came about primarily because tiremakers and marketers created an absolute mess of things, clouding consumer minds with so-called 100 Level and 200 Level tires, even though there was no legitimate way to determine the difference.
It’s interesting, too, to see what early UTQG results looked like…and what passed for a premium tires.
Here is a condensed version of Bill’s editorial on the subject:
The UTQG requirement for bias-ply tires has been in effect for a month. Tire Review conducted a comparative study of the grading system and discovered why so many tire dealers, private brand owners and manufacturers have been upset over the regulation.
To say the least, the Department of Transportation opened a Pandora’s Box. NHTSA says that “while the new standards do not tell a tire buyer what to expect in terms of tire wear, the standards should help a customer make an educated purchase.”
One of the first things a customer wants to know when purchasing a tire is how many miles can he expect to average. The grading system does not enable the customer to make an ‘educated purchase” with regard to tire wear.
Both the Rubber Manufacturers Association (RMA) and the National Tire Dealers & Retreaders Association (NTDRA) are concerned about the unreliability of the grading system and the consumer confusion this regulation has created.
They have, however, agreed to urge members to comply with the regulation and make the best of a seemingly hopeless (impossible) situation.
Confusion has not been confined to the consumer level. It has infiltrated dealers and manufacturers. The following pages contain a list of each bias-ply tire brand, line and size and what the brand owner reports is the tire’s treadwear, traction and temperature grading.
The reader can readily see several trends in the grading system.
First, several private brands have tires rating considerably higher than the major manufacturers.
A brief review of the charts seems to indicate a rating of 80BC as the norm. Cooper, Dunlop and Co-op, for example, have rated their brands in the 90-100 BC range.
Also of note are those brands, which have ratings of 120 and 140. Tire Review was told by the manufacturers of these brands that the tires in question are “high performance” tires and consequently are designed to wear 20% to 40% better than the DOT’s “control” rating of 100.
All treadwear ratings are qualified. The last sentence on the grading label tells the consumer that: “The relative performance of tires depends upon the actual conditions of their use, however, and amy depart significantly from the norm due to variations in driving habits, service practices, and differences in road characteristics and climate.”
So much for the idea that a consumer can make an “educated purchase.”
What the tire grading really tells the consumer is nothing.
Tire Review spoke with representatives of Goodyear, General, Firestone, Armstrong and Dunlop. Their opinions and observations are interesting. Most of the spokesmen asked not to be identified.
All agreed that while most tire dealers are ignoring the tire grading system by simply the grading hand out and not addressing the issue, some dealers are capitalizing on it.
For example, a dealer has a major brand name that rates 70 BC and a private brand that rates 100 AB. Some dealers are using the grading system to sell a private brand and realize a better profit margin over what they could have realized with the major brand.
The consumer is then led to believe that he is getting a better tire for less because he does not have to pay more simply to buy a “name.”
So why didn’t the big tire manufacturers think of this and rate their brands higher?
They, too, have the program figured out.
A conservative rating serves two purposes. First, a lower rating can help stave off the possibility of a lawsuit because a tire will almost certainly perform better than its rating.
Secondly, as several tire manufacturers put it, where can you go if you start at the top?
Bias-ply tires are not dead. New lines will continue to surface. As a new line is developed, the tire should logically be better than its predecessor. Thus it must have a higher rating. Consequently, while a current bias-ply tire may actually rate 90 AB, it has been labeled, by the manufacturer, as being 70 BC to allow room for growth.
The importance of this logic is not confined to bias-ply tires. It will carry over to radial tires when labeling takes effect on April 1, 1980.
So, once again, NHTSA’s theory that the “standards should help a customer make an educated purchase” simply does not hold water.
DOT deceived itself and the American public with the Uniform Tire Quality grading requirement.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Then He Celebrated With ‘Special Friends’
June 26, 2009
Max Mosely got his way. You’ve got to give that randy bugger his due, he figured out how to wrestle eight uber-rich race teams back into line.
All it cost him was his job.
The Formula 1 world breather a sigh of relief Thursday when it was announced that FOTA – the wildcat Formula One Teams Association – was a dead issue and that there would be a singular FIA-crowned world champion in 2010. And, supposedly, beyond.
Mosely will end his 16-year stranglehold on FIA, the series’ sanctioning body, in October when his fifth term ends.
Good damn riddance. Most observers have felt that between Max’s ironclad, often divisive rule and that of F1 chief Bernie “Big Pockets” Eccelstone, the series has become cost bloated, overly technology driven, exclusionary and, well, darn boring.
And then there was the embarrassing incident last year when the 69-year-old FIA president, the son of former British fascist leader Oswald Mosley, was caught partaking in a sadomasochistic orgy with five prostitutes in London. A video of the incident was widely circulated on the Internet.
Max did get the FOTA members – Ferrari, McLaren, BMW Sauber, Renault, Toyota, Red Bull, Toro Rosso and Brawn GP – to buy into a modified cost-cutting plan, and to swear their technical help to future incoming teams.
Hopefully Max’s parting gift to the racing community will end up being a stable, more global and more competitive “world championship” racing series.
And hopefully Bernie will be the next to leave.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Trespassers Are Warned!
June 24, 2009
As mentioned the other day, American Tir…I mean Colorado Tire Corp. has changed its name and taken down its previous Web site, promising to launch a new one soon.
When the ATC site was first taken down, it carried only a single post that basically sort of explained the company name change and the promise of a new Web location. It was short, sweet and sort of to the point.
And then things changed…Below is the statement – verbatim – that now appears on the site:
Announcement
In order to consolidate our corporate identity behind our company's most recognizable and valuable asset, i.e., the Colorado brand OTR tires, which have been extensively approved and recognized by various users in different countries, the Board of Directors of American Tire Corporation has determined to change our corporate name to Colorado Tire Corporation.
Any existing and ongoing contracts/agreements/authorizations between any company and American Tire Corporation shall be reentered with Colorado Tire Corporation by the end of June 30, 2009, or otherwise will be deemed invalid.
Our old web address www.americantire.us will be no longer in service. Our new web site will be announced separately.
It has come to our attention that several companies and individuals respectively in Akron, Ohio and Spring Hope, North Carolina, who are working for our competitors, are writing and spreading libels related to us. Further, we have received quite a few reports that a number of Chinese and western companies are selling FAKE "Colorado" tires. Without question, such acts are, in many countries, not only illegal, but also criminal. Our legal counsels have been instructed to take proper actions against such illegal and/or criminal acts.
Our Board of Directors believes that such a name change will enhance us in protecting our brand from any illegal/criminal act.
Any questions or inquiries, please feel free to email to info@CoTire.com.
So whomever it is in Akron or Spring Hope that is causing the company concern, considered yourselves warned.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Dear China
June 24, 2009
It has come to our attention that we apparently just don’t want you around. The glow of the Olympics has passed, and we’re tired of all of the Travel Channel reruns. I mean, just how many times can we see Andrew Zimmern eat his way through your country? And how you let Samantha Brown in we’ll never know.
It’s not that we don’t like you. Heck, you’ve got more cool history in a grain of rice than we do from sea to shining sea. And who doesn’t love those pandas? But we just decided that we don’t want what it is you have to sell. You see, despite our inbred desire to buy everything on sale (even if it isn’t), we’ve apparently decided it’s best if we just fend for ourselves. From now on, we’ll be taking back production of a whole host of goods our corporations effectively outsourced to you many years ago.
So, for the foreseeable future, please keep those cell phones, DVD and Blu-Ray players and digital cameras (except maybe a few iPhones cause they are just too cool). Computers and monitors and servers and modems can stay there, as well. And we won’t be needing any of those inexpensive office desks and chairs.
Kick those football tees and toss away the baseballs. Gloves, too. And don’t forget the batting helmets and catcher’s gear, hats and uniforms and socks. Baseball is America’s Game (don’t tell the NFL) and we’ll make our own gear, thank you very much! Who cares if batting helmets cost $300 each!
Nobody really likes yard work, so hang on to those rakes and shovels and planters and hoses…all of that stuff.
Coffee cups, cookware, glasses, plates and place settings? No thanks. Same with tablecloths and napkins (not that we use those).
Tchotchkes, bric-brac, niff-naws, thingamabobs, doo-dads…we just don’t have room anymore.
And box up those jeans, shirts and pink tank tops. OMG…can you believe just how cute those are?
You know, this list will just get out of control and I just don’t have the time right now. I’ll send you an e-mail later. Better yet, just stop shipping anything over here. That way the unions will be happy, and we’ll be able to return to normal around here.
One thing…ship a few more containers of those “We’re No. 1” foam fingers our way. We have a big “Welcome Back Manufacturing” rally planned and, well, we’re on a bit of a budget.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
They Ready and Waiting
June 24, 2009
If you think the rest of the market is taking a big nap while GM and Chrysler dealers – and all of those service bays – are getting whacked, thing again.
This from Meineke Car Care Centers:
Meineke Car Care Centers Supports Right to Repair Act
Chrysler and GM bankruptcies highlight need for additional repair options
June 16, 2009 - As of early June, Chrysler LLC wants to eliminate 789 dealerships – roughly one-quarter of its total U.S. dealerships – saying that their sales are too low. General Motors seeks to make a similar move. While the final decision rests with the bankruptcy courts, the possible closing of these dealerships has customers concerned: Who will handle the warranty work on their Chrysler and General Motors’ vehicles?
In the meantime, according to CNN.com, car owners’ warranties will remain valid through their term regardless of where the vehicles were purchased, and the required warranty maintenance work can be done at any certified shop. This may be a much better option for consumers than driving to the nearest existing Chrysler or General Motors dealer. Many of the dealerships targeted for closure are in small to mid-size towns, meaning that the next closest dealer may be up to 60 miles away.
“Manufacturers like Chrysler and General Motors require that new vehicles be maintained in accordance with the specifications outlined in the vehicle’s owner manual in order to protect the new car warranty,” says Don Rauch, director of dealer communications for Meineke Car Care Centers. “What owners may not realize is that most Meineke Care Care Centers have ASE-trained technicians who are qualified to perform the maintenance work needed to preserve the new car warranty. We can’t perform repair work that is covered by this type of warranty, but we can provide the required maintenance.”
Rauch notes that restrictions on warranty repair work have accelerated the push for the Right to Repair Act, which would allow independent repair shops to compete for the business now guaranteed only to dealer-contracted establishments. Until recently, car manufacturers have severely limited the number of repair shops that are allowed to have the technology, diagnostic codes and updated repair information required to make some warranty repairs, given today’s computer-reliant cars. With the Right to Repair Act, the door would open for more independent shops to make critical repairs.
However, Rauch explains that certain warranty repair work can be done at local Meineke Car Care Centers. “If a customer purchased a vehicle service contract, also called an extended warranty, from a now-closed Chrysler or General Motors dealership, then local Meineke Car Care Centers can perform warranty work under these types of contracts," Rauch says. "We will be paid by the warranty company for those repairs. We advise customers to check and see what kinds of warranties they hold, and if they have any questions, please call us.”
For car owners looking to purchase a vehicle service contract, Meineke now offers contracts for most automobile makes and models with mileage up to 150,000 miles. This new program, called “Meineke Vehicle Protection” or “MVP” is available in 26 states across the United States. Car owners can log onto www.meinekemvp.com, or call 1-877-670-6877 to see if the program is offered in their state, and to get a quote for a contract.
“If you own a Chrysler or General Motors vehicle, don’t panic,” says Rauch. “We have the ASE-certified technicians to maintain and repair your cars and keep you on the road for years to come.”
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Ah, It Just Keeps Getting Better
June 22, 2009
Alleged U.S. giant OTR tire manufacturer and purported U.S. government-supported American Tire Corp. is no more.
The chameleon-like company – which has alternately traded as American Seashores International, Washington Tire Corp., American Tianbao Corp. and, of course, the infamous ATC – is now called Colorado Tire Corp.
Of course, it didn’t have a choice – in March, a U.S. appellate court so ordered that American Tire Corp.’s name and logo were easily confused with that of mega-distributor American Tire Distributors. The order was apparently affirmed last week by the original court.
So, now ATC is CTC.
For those who like consistency, though, there is good news. Apparently CTC “president” Abraham Hengyucius is still around, and the importer of China-produced OTR tires remains a mystery surrounded by a conundrum wrapped in a riddle.
And we wouldn’t have it any other way.
Still waiting, as I’m sure you all are, for news of a pending groundbreaking for CTC’s $1 billion OTR tire plant in Washington state. I’m hoping my invitation is in the mail!
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
More Tire Works News
June 22, 2009
I am putting this June 19 news report by Las Vegas’ KTNV.com here because despite its obvious tilt, there are a few valuable lessons here for tire dealers.
Tire Works, to catch you up quickly, is the Las Vegas tire dealer that was investigated by the state for alleged deceptive practices. The dealer is counter suing the state, but this type of publicity isn’t going to help its case.
Customer Sues Tire Works in Small Claims Court
Tire Works owner Roshie Weightman showed up in person to battle customer Jennifer Cairy in Small Claims Court.
"I paid, I waited 15 minutes and then the mechanic and the salesman came out and told me there was some additional problems and they weren't able to complete the work to their satisfaction," Cairy told Judge David Stoebling.
Jennifer went to the Tire Works on Silverado Ranch in February for an alignment and new brakes.
"They told you there were problems still with the alignment?" Judge Stoebling asked.
"After I paid," Cairy answered.
She tried to get her money back but Tire Works refused.
Then, as Contact 13 first reported in April, Jennifer got an e-mail sent by Tire Works District Manager Dalin Crowsey... An e-mail that wasn't intended for Jennifer's eyes.
In it, the manager calls her a nitpicking b---h and writes about "up-selling" her.
The judge wanted to know more.
"She came in requesting brakes and an alignment. Nothing was upsold to her." explained Roshie Weightman.
As for the name-calling...
Roshie said, "Unfortunately it was in poor judgment by Dalin to write such a thing and we did apologize to her and she did not want to accept our apology."
Jennifer told the judge how that "apology" came out.
"She said what do you want me to do to fix this? She said do you want me to take him out to the side of the store and shoot him? Do you want me to murder him? And I said, is this actually happening? You're actually a professional woman having this conversation with me? All I'm asking you for is my $60 back."
And all because they charged her for the alignment even though the tech told her they couldn't get it right because of something called a bushing.
Roshie told the judge, "The axle of the car holds the two tires. The bushings sit on top of that."
They told her they could fix the bushings for $1,800 but did the alignment anyway, which turned out to be no good despite what Roshie's contentions.
"The car was not pulling anymore. It was just slightly pulling."
"Do you have something that tells the customer that the alignment you're going to perform for them is not going, under certain circumstances, may not be worth anything at all? Do you have something like that?" Judge Stoebling asked her.
"No but we also don't have anything that says if the customer leaves and hits a curb five minutes after he leaves that the alignment will go right back out again." she answered.
"I think you should get your money back on the alignment. I think it was done, it shouldn't have been done," Judge Stoebling said, deciding the case in Jennifer Cairy's favor.
Outside the courtroom, Cairy told Contact 13, "It's nice to know that the smaller people, just the regular average housewives can get some justice."
And justice may be coming for many more if the Attorney General succeeds in her lawsuit against Tire Works.
The state is seeking to shut Tire Works down after an undercover investigation with Contact 13 revealed a pattern of deceptive trade.
"I hope that she's no longer in business. I hope next year there are no Tire Works and we can go to much better companies," Cairy said.
Tire Works owes Jennifer Cairy $176 but the judge suggested her legal battle with them shouldn't end there.
He asked why she hasn't pursued a defamation suit against them for the content of that e-mail.
Tire Works is already in the midst of a defamation lawsuit related to the state's investigation.
They filed it against the state's expert mechanic after he called their business practices fraudulent.
That case is scheduled for its first court hearing on June 30.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Sideshow Freaks and Max Mosley
June 22, 2009
Now that the 2009 F1 season has settled well into week after week of boring run-aways, you can always count on the carnival that is the Euro-race series to provide some comic relief.
FIA head Max Mosely, purportedly a bit of a sideshow freak himself, is scrambling to keep the current Formula One series together even as nearly every F1 team has announced plans to bolt and form its own world championship series – the Formula One Teams Association or FOTA for short.
And why are eight of F1’s 10 teams – including Ferrari, McLaren-Mercedes and new powerhouse Brawn F1 – looking to break away? Because Max wants to slap a spending cap on the notoriously free-spending race teams. A paltry $65 million annual limit.
And why does Max want to cut budgets? Well, unlike team principals, Mosely can see the forest for the trees and knows full well that 17-race nearly global series (no U.S. or Canada events again!) cannot continue its arms race, even in a good economy.
Some say Ferrari, for example, pours $400 million annually into its two-car effort. Through the first seven races of 2009, that pile of money has produced no race wins. McLaren, another mega-spender, hasn’t even earned a podium after fielding the 2008 champ Lewis Hamilton and nearly winning the 2007 slate.
So the uber-rich free-spenders want to go off on their own. Well, Max ought to just let them and then build an all-new, budget-conscious F1 series. While the FIA (which claims jurisdiction over FOTA, by the way) doesn’t need a split ala CART and Indy Car, it seems inevitable.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
King Harvest Has Surely Come
June 18, 2009
No doubt that within days I will get news releases from Bridgestone and Goodyear and Michelin and Cooper – everybody – announcing plans to build new plants in the U.S. to produce low-value broadline tires.
Why? Cause that is exactly what Leo thinks he’s gonna get now that the International Trade Commission has sided with the USW’s incredibly weak argument that radial passenger tires imported from China has directly led to the loss of thousands of tire plant jobs in this country.
And what Leo wants, Leo gets.
“Our domestic industries cannot survive unless our government enforces the trade laws designed to curb and dissuade anti-competitive practices that cause market disruptions,” said USW International President Leo Gerard. “We anticipate the remedies that will be delivered to President Obama will allow the time necessary to rebuild the U.S. tire industry.”
“Remedies”? “Rebuild the U.S. tire industry”?
Those “remedies” may well end up being what Leo wants – a three-year limit on the importation of China-produced passenger tires (an immediate cut to 2005 levels, plus up to 5% incremental increases for each of two years). Too bad, because those cutbacks will surely put more people out of work than will deliver new jobs to the USW. Like the private branders that depend on Chinese producers to make their products (since no one but Cooper still makes private brand tires), and private brand distributors and private brand dealers. Oh, and the legit importers of Chinese branded tires.
And there won’t be any rebuilding of the U.S. tire industry. Number One: It ain’t broke. In fact, our local industry should be commended for how it has managed itself in these trying times, working hard to minimize the negative impact on employees and distribution while trying to remain financially healthy. Very, very hard job, to be sure.
Number Two: No one will be adding capacity here to produce low-margin tires. Nobody, Leo, will be building new plants or adding production. Ain’t happening. The days of American- or Canadian-made Tier 3-4-5 tires is passed. There will be demand for those tires, because of consumer demand for size or price (mostly price, especially in these days). Whatever shortfall is left by the proposed import limits will be made up by tires from other low-cost countries, not by tires produced by your members.
I hear Indian tiremakers are real anxious to make a mark here. So, Leo, are you going to go after them, too? Are you going to chase every country? Hell, I got an e-mail today from some outfit selling Indonesian-made passenger radials.
It is, and has been, a totally disingenuous argument to claim that the sharp increase in the number of tires imported from China directly resulted in closed tire plants and lost jobs here. Equally absurd is the USW’s convenient loss of memory when it fails to recognize that its tire company employers have contributed to that import increase.
Those plants and those jobs went away because of cost. Because it cost a lot less to make low-margin, no-profit tires overseas than it did to make those same tires here. A number of years ago, raw materials costs, as we all know, went through the roof. Despite “concessions” made by the USW, it still cost too much to make those tires here. And some of those plants were closed because the USW itself proved to be a difficult dance partner; the union even negotiated the closure of one plant into its last master contract with Goodyear.
That is reality.
This is not: “We anticipate that the final decisions on remedies will improve domestic job security, increase production and sales, and allow for investment in capital equipment to better compete in the global market for the long term.” - USW vice president Tom Conway.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Hey, CBS Still Hasn’t Weighed In Yet
June 18, 2009
I gave you a few days to digest viewer comments made after last May’s “investigative report” by ABC on the “dangers” of older tires (see below).
Interesting to me is how many people figured it out for themselves, using words like “sham” to describe the report and reminding others of their responsibility to maintain their tires. Good for them.
Still, one year after the industry took that public lashing (NBC had a similar but little seen report on the Today Show in April 2008), nothing has happened. Nada. Of course, the lawsuits against tire companies and tire dealers over injuries and deaths purportedly caused by aged tires continue. And three states want to enact legislation to curb sales of old tires – all of which penalize tire retailers but not tiremakers. But those are apparently minor inconveniences, compared to, say, a firm position on the subject.
Apparently the RMA and TIA are still waiting for “scientific evidence” to surface.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
A Different View
June 15, 2009
We all remember the lashing the tire industry took last spring when both NBC and ABC televised “investigative” reports on the so-called dangers of older tires.
NBC’s report appeared on the Today Show, while ABC used its 20/20 newsmagazine to carry the water for Sean Kane and his plaintiff-attorney assisting Strategic Safety.
When ABC posted its report online, it offered viewers the chance to add their comments on the report. Here are all of the comments posted verbatim:
Hidden Tire Dangers
ABC News Hidden Camera Investigation: Aged Tires Sold as 'New' by Big Retailers
Viewer Comments:
Yeah know, I just cannot figure out why when things like this tire situation are anywhere near surprising to anyone..the basic rule in the great country of ours is to do the very best one can do to screw anyone who comes in contact with you, especially if its in politics or business, but really it applies to all phases of interaction in this hollowed land..what runs this country now is greed, the bottom line, the bigger the better and screw who gets caught on the hook....even religion in any form is not immune...lets here for Gene Autry good times are past...I am very blessed in the things that I have, but even those things are faulty because the builders and manufactures were crooked in thier processes, selling, installation anyway to increase the bottom line regardless of who gets under the wheels..so people if the moon explodes don't be surprised someone probably made a buck from it..
Posted by: oralcitrate Mar-25
This seems to be quite an old article, but it's still not difficult to find relatively old tires at many retailers, including dealerships. It's not an issue for most consumers in my experience, though, because there are certain tire sizes that are used by a multitude of vehicles and are therefore sold very quickly. However, there are some sizes that are used by far fewer vehicles that can easily stay in stock for two years or more. However, these tires neither bear any weight nor receive exposure to sunlight, extreme temperatures, and/or ozone. I've read that those factors contribute the most to the deterioration of a tire. I've also read that, perhaps ironically, tires which bear a heavy load and are not used often may deteriorate faster than tires on a vehicle that is driven regularly. One of the biggest obstacles to offering consumers services that will ensure their safety is the amount they are willing to spend. Consumers sometimes knowingly place themselves in very hazardous situations by seeking the cheapest route possible. I'd also like to mention that there are many situations that present a Catch-22 for a tire service technician. If a tire technician refuses to perform a service such as selling and/or mounting an aged or damaged tire because he/she believes it is unsafe, he/she could be in trouble with his/her management for not acquiescing and offering customer satisfaction, particularly if he/she refused the service in error because of improper training. On the other hand, if he/she performs the service and the tire contributes to an accident or inconvenience, the technician could be in trouble with his/her management for putting a customer in a hazardous situation.If this issue is ever pursued again in the future, I think more focus should be placed on obtaining answers from management of such retailers and the manufacturers themselves.
Posted by: unmotivator Feb-27
Dissecting a 10 or 12 year old tire sitting on a shelf showing separation or conditions leading to separation may have substantiated your report. You have done an injustice to your industry as well as the tire industry.
Posted by: bjlr501 12/7/08
Interesting stuff but I'm curious about the "research and tests" that show "as tires age, they begin to dry out and become potentially dangerous". Who conducted these tests, and is the validity of the testing recognized by the automotive and tire manufacturing industry? And how does the accident rate attributable to aged tires compare to accident rates that are due to tread separation and other inherent tire flaws?
Posted by: hankgordon2 8/12/08
It's a load of bull.... You MUST perform routine maintenance on your vehicle. This includes things like changing the oil, topping off the fluids, Changing brake fluid ever 1-3 years, checking engine belts for wear and cracking, changing your fuel filter, and yes - checking your tires for wear. The reality is if you put on the standard 12,000 mile a year, your tires will only last about 3-4 years anyway. If you want information on how to check your tires and what you should look for, Tirerack.com has tire test results and general tire info that can be very helpful. I took a nail in a tire once and I had to keep inflating it every month or so because I couldn't find the hole. The nail was still in the tire when I finally replaced it. Unfortunately, not only did my mileage go down, but my brakes became more worn as a result and I ended up paying for a new brake job. While you are checking things on your car, have a friend or family member help you check your lights. Turn signals, brake lights, head lights and other marker lights can go out at any time for any reason and most of the time, you would never notice.
Posted by: windsurfing_guru 7/31/08
Thanks 20/20 for the invaluable info. I have broadcasted to everyone I know. Who knows you may save some lives without even knowing! Keep up the good work of keeping America safe and informed.
Posted by: beckstr2000 7/8/08
I just took off two tires date code 1990-1991 off my vette 18 year old tire driven the car in excess of 100 mph for long periods no problem These are the speed rated high quality tires that were OEM. The gov not going to scare me into footing the bill for there wining and dining because they need more tax from everyone. Test some real tires in real age conditions not article aging and SHOW ME!!!!!!!!!!!!!!! the real results for all tire brand proceses type speed rating and so on. They cant test a cheap poorly maintained tire and say ALL tires of age are defective. Is Bush getting a kickback on tires also?
Posted by: mikevette1990 6/3/08
You people are ridiculous, If you came into an autocenter before this and were told to replace tires based on age you would say "you're just trying to sell me tires" It's safe to say that the majority of those tires were on CLEARANCE RACKS. I don't know how many customers i have come in and say, i want the cheapest tire blah blah blah....you get what you pay for. In this time and age of MCDONALDS all you people want it and want it now. It's pysically impossible to have every tire in stock in every size and only have it be 6 months old.
Posted by: mopar53150 5/25/08
I hope all of us take this information seriously, as a member of my family was just in an accident yesterday for this very reason. Do yourself a favor, do your family the favor of giving this the benefit of the doubt and go check your tires. The car rolled several times and we are so grateful he was okay, but the officer on site was surprised that was the case. How much does it really take to make sure you're really safe. Thanks for the information ABC. This little life-saving tip should not have been kept a secret. Thanks for telling us all.
Posted by: ktrenae 5/17/08
I don't know a lot about tires but I have a 1983 Mazda RX-7 with only 34,000 miles, that I bought from my mother who hardly drove it while she owned it for 12 years. I continued to drive it for 12 more years occasionally and I never had to replace the tires until one year ago when they started to crack. I kept checking with my local trusty tire store to assess the tires and they kept saying they were fine until last year. So, I don’t think age is the main factor. I recommend building a relationship with a tire store you trust and keep checking with them about the condition of your tires.
Posted by: uoft1985 5/12/08
I agree with many of the people here that the age of a tire does not constitute if a tire is bad. If you do proper air pressure checks, rotations and alignments on your vehicle then your tires will function the same whether it be 6 months old or 10 years old. The weather has a major effect on tires and not age. So do you want to talk about the belts on your car? They are made of rubber? Do you think they all have a shelf life of 6 months? NO! It is all maintenance of your vehicle. Don't you think that every single tire manufacturer would put "expiration dates" on their tires if the proof was there? They don't because there is not enough evidence to prove this myth. Leave these tire dealers alone and talk to the manufacturers of these tires.
Posted by: firstbrunettedaughter 5/12/08
You are SO busted. I will not, repeat NOT, buy a tire from you if you can not certify that it is less than a year old. Period, fini, end of story. So you might as well bite the bullet and write off all those 2 - 12 years old tires right now!
Posted by: alice888 5/12/08
The tire investigation was fine work. Missed the first part and hope to see this segment again. As for the general content of 20-20, I much prefer the hard news investigations that save lives over the celeb news and soft pieces I see so much of on your program in recent years.
Posted by: TradeWind2 5/11/08
I take issue with the comments that the date code is "intentionally cryptic" and placed on the inside wall of the tire. First of all, there IS NO inside wall to an unmounted tire! The code is placed on the presumed inside wall because we consumers want the prettier side to show. It's an aesthetic choice, not one that is designed to obscure. We put tags on the inside of our clothing for much the same reason. More, did it occur to anyone that it would be in the US tire industries' interests to support a 6-year age limit if it were necessary? They'd sell more tires! Going along with an arbitrary expiration date is exactly what a company who valued money over safety WOULD do.
Posted by: liz 5/11/08
Interesting piece
Posted by: Stormins 5/10/08
The biggest cause of tire seperation is under inflation. The story does not mention what happens to a tire that has been sitting in a rack for up to ten years to make it unsafe. Most tire deterioation is due to direct ozone or sun exposure, and sitting for long periods of time on bare ground. Why would a tire in a enclosed building on a rack just go bad?
Posted by: uscjoe1941 5/10/08
What about the tires on new vehicles purchased at dealerships? Now I am going to have to look at Mom's 1 year old KIA Sorento..it has Michelin tires that are already bad after not even 2 years. I think everyone with a newer vehicle should check the date codes on their tires too. Too bad the story didn't cover tires on new vehicles as well.
Posted by: cherylholmes 5/10/08
After watching the show I decided to check my "new" tires I had purchased last fall. Turns out I had nothing to worry about. I bought those tires from a dealer. I purchased the tires in the 42nd week of 2007. According to the DOT number all 4 of the tires were manufactured in the 17th week of 2007. So my "new" tires really are new. They were made just 25 weeks before I purchased them. Needless to say I am pretty happy with this knowing that my local Dealer was not stocking old tires.
Posted by: Skyb1rd 5/10/08
Unfortunately there seems to be a misconception that old out of date DOT# tires are sent back to the manufactures to be broken down and reused to make new tires. These tires cannot be put in new tires but ground up and used in rubberised asphalt and in outdoor play areas. The steel is stripped from the tires and recycled. As a retailer of new tires I reject older DOT # tires. It is most likely stock that has been in a Wholesaler's Warehouse and not rotated properly out of stock.In the southwest and southern states where heat and underinflation is the key to most tire failures we find that poor maintence is the major cause of most tire failure not age. It should always be up to the consumer to educate themself's in any purchase. Most Independent Retail Tire Dealer would gladly inspect and help consumers decide if a new tire is needed. In the year 2000 Firestone was subjected to recall on tires installed on Ford's Explorer and during this recall we we pulling tires off the Explorer that were 10 years old and still had half the tread left. We are now as consumers being told that we are not responsible enough to check our air pressure in the tires on our own cars and suv's and light trucks that our federal government has mandated that all of these must have Tire Pressure Monitoring Systems. This adds to the cost of any new vehicle and the service that needs to be done thereafter. Simple maintenance and checking your tires air pressure at least once a month will add to the life of you tires and to the safety of your families. In a nutshell the age of the tire is important but proper maintenance is crucial to tire life and safety.
Posted by: giddens 5/10/08
The number 1 cause of tire failure is underinflation, not age. The number 1 cause of underinflation is owner neglect. if people would just check their air pressure once a month, tire age would not be a story on 20/20. People would get improved fuel economy and their tires would last beyond the tread wear warranty. This is a proven statement of fact. Remember, you are the key to your vehicle's safety. Open your glove, pull out the owners manual and read it. Most people have no idea what kind of info is in there.
Posted by: navstargps 5/10/08
After watching I went out to check the tires on my 2007 Ford Exp. Sport Trak and found the number they describe on the show to be MISSING the area is there the circle so to speak BUT NO NUMBERS WITHIN IT! That scares me. Am I to buy 4 new tires?
Posted by: kpsnip 5/10/08
Where are the statistics on number of accidents directly related to failures of 6 year and older tires? Where is the analysis and research that went into the British study quoted? Is a personal injury lawyer the technical expert? Interestingly you focused the camera twice on separated treads on the side of the highway implying they were from six year old tires. They were not. They were clearly separated truck retreads which are all over the highways. This is clearly unsubstantiated, misleading reporting.
Posted by: Ted.R 5/9/08
I have 1961 MGA with Michelin X tires on it. The tires were installed in 1970 and currently have about 50,000 miles on them. That's 38 years folks! None of the tires have ever had a flat nor have they gone flat in storage. I just had the car out on the backroads of Oregon at 55 mph. Tire too old at 6 years? Make no sense whatsoever to me. Where the data that shows tires fail? Is it consistent across brands?
Posted by: Barkdust45 5/9/08
hamdave, It has been found that under-inflation has caused a lot of tire failures in the past. Everyone, go out and inspect your tires, make sure they are properly inflated, and check the tread. and if they are heavily weather-checked, then take care of it. This is a maintenance issue. I still want to see lab test results of unused tires stored correctly as compared to recently manufactured new tires. The technology exists to do that. Then and only then will I be convinced that ABC 20/20 is doing a public service with this story.
Posted by: northwoodsbug 5/9/08
I have a vintage sports car with Michelin tires which are now 37 years old. Yes, 37 years and about 45,000 miles. I just had the car out and the tires are just fine. It seems to me that someone is trying to increase sales. There must be something more serious/real to investigate!
Posted by: Barkdust45 5/9/08
Note that the date code (which will start DOT)will be branded into only one side of the tire, the other side will have all the letters and stuff that tell where and so forth the tire was made, but a blank space where the number would be.... The big issue here is that while tires do not age as fast in a cool dry warehouse, they do age and once on the vehicle no way to tell how much of that age was on the vehicle. Not as big an issue in northern areas, but here in southwest Florida tire age fast.I have been told by several tire outlets that Florida has a law making it illegal to repair a puncture in a tire over 5 years old. Unless a tire is a very odd size there is no excuse for it to be in stock for more than a few months, Just poor inventory management.
Posted by: kozynferg 5/9/08
Selling an 'old' date coded tire is 'criminal'. Those of you who don't believe may have never had a blown out tire at high speed, it can be quite devastating to your health, much less the equipment vehicle the tires are mounted on. The age issue is because tires will eventually dry out. On a passenger car where you will drive it about 12-15K miles a year, you will normally wear the tire out before the date issue is a problem IF you got relatively new ones to begin with !! There are statistics that show that older dated tires are MORE hazardous and have a greater tendency to have catastrophic failure.
Posted by: hamdave 5/9/08
The six year age limit recommended by automakers, according to the way I read this article, must have an assumption here....the tires are already mounted on a vehicle and need to be replaced after six years. Right? Anyone with a camper knows what happens to tires even if the camper is used once a year...the sun and its UV rays, plus the heat dry them out and they become checked. Now, please tell me why the condition of these above mentioned tires are the same as tires that have been warehoused, out of the sun and drying elements of outside air, and never used? In order to be convinced that this is a real problem, I would like to know where are the data that supports tire deterioration over time when the tires are warehoused, stored out of the sun's rays and out of the ambient temperatures of a parking lot? Tires are not bananas with a shelf life based only on age. I want to see real scientific tests on the physical properties of tires, newly manufactured, older tires within the "age limit" and tires properly warehoused older than that. One commenter brought up the issue of money...think about it folks. Who would make money if all unsold tires older than 6 years were to be taken off the market, shredded, recycled and mixed into new tires, and sold to you at the going price now that oil is over $120? Tire companies would make out like bandits...not having to pay for the raw materials, but the consumer pays the full price as if they were completely new!
Posted by: northwoodsbug 5/9/08
There should be a label that shows DOT xxxx. The first two digit is the week it was made and the last two are years.
Posted by: makattack4000 5/9/08
This is nothing more than just fear mongering - is there some validity to a dried-out tire and potential performance issues? - absolutely. But suggesting that ALL tires beyond their "expiration" should not be sold is just plain ridiculous. I think we have bigger fish to fry then to worry about something like this.
Posted by: cpurvis 5/9/08
Check the long string of numbers on the side of the tire. At the end of that string will be four numbers. The first two are the week the tire was manufactured and the last two are the year. For example, if the number is "2604". Tire was manufactured the 26th week of 2004. Good luck.
Posted by: Mystic_Redcat 5/9/08
I feel I need to comment here: First of all, the automotive industry has a six year limit, because I assume that the tires in question are mounted on the vehicles and are in use. Anyone with a camper stored outside in the sun knows that the sun and its UV rays do the most damage on tires, used or unused. Parking a car all day in the lot at work or at the mall...not only lots of sun, but heat from the asphalt. Now, how is a six year old tire in use the same as an unused tire stored in a warehouse...most of them are kept dark. I would like to see the scientific analyses of the physical properties of older unused tires compared with the same properties of newer unused tires and of course, tires that have been mounted on vehicles, even if they are not driven except to go to church on Sunday. I don't think safety is an issue as much as this article leads me to think. Just think of the money to be made of all tires older than the requisite six years have to be shredded, the rubber contents recycled, mixed back into to make more tires, and then, tah tah, sold as new at the inflated price now that oil is $120 plus.
Posted by: northwoodsbug 5/9/08
This is why it is best to buy direct!! Some people wont wait and will go to a store and buy what ever they have not thinking those tires have been there as long as the store sometimes. Especially if its and uncommon tire size. Low profiles are the worse when you buy them in a store. Just look before you buy as you should would everything you spend your money on....
Posted by: invisible099 5/9/08
I just ordered a set of Goodyear tires...how do I read the code on them to know their 'best before date' ? ABC, please tell me!!
Posted by: desmond222 5/9/08
Anything to make money. That is WalMarts stand and any other Stores stand that puts the safety of its customers below there bottom line.
Posted by: fastiger13 5/9/08
I'm just positive the store management lies awake at night, every night, worrying about the safety and well-being of the people who purchase their products.
Posted by: kgainer2334 5/9/08
Gosh, this is such a travesty. Come on, investigate some real issues for a change.
Posted by: AVGWarhawk 5/9/08
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Fix It Yet Again Tony
June 11, 2009
The world’s most often rescued automaker has officially been rescued again as Fiat, makers of semi-reliable autos, wrapped up its semi-purchase of ailing Chrysler.
Chrysler will surely benefit when Fiat rebadges its popular Euro gas-sippers and ships them here. That will be a refreshing change from Chrysler’s current line-up of cars and light trucks that share the same look…and gas-gobbling qualities.
Fiat, in return, will get….well, no one is quite sure. Probably not even a hemi. Oh, sorry, it gets a 20% share in Chrysler. Some 55%, though, will be owned by Chrysler’s UAW Retiree Medical Trust, 8% will be held by U.S. taxpayers, and the Canadian taxpayers get 2%.
And if it the marriage doesn’t work out, Fiat can pick up and leave anytime it wants. Sweet!
New Chrysler/Fiat CEO Sergio Marchionne, offered these words, which should make any taxpayer shiver: “We intend to build on Chrysler's culture of innovation and Fiat's complementary technology and expertise to expand Chrysler's product portfolio both in North America and overseas.”
The last time we heard such hopefulness, all we got was the K-car.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Guess Who’s in Your Wallet?
June 11, 2009
With summer near, gas and diesel prices are on a sharp upward path once again.
Though hardly has awful as last year – $4.25-$5 per gallon reported in mid-2008 – consumers and truckers are screaming as gas is hitting $2.80 and diesel pushes $2.60.
And who is pushing the price buttons? Same as last year….oil speculators. You know, rich people placing high dollar bets on the price of crude. Oil, which reached an absurd high of nearly $150 per barrel last summer and came back to the mid-$50/barrel range earlier this year, vaulted above $70 per barrel in early June. Some experts say $3 per gallon gas is coming our way, as traders play games.
Finally, there are some groups taking up the fight. Nearly 80 consumer and business groups – including the American Trucking Associations and consumer groups – are taking it to Capitol Hill, calling on Congress to rein in oil speculators – and all commodity traders.
Here is the funny thing…much like our banks and mortgage houses and insurance giants, the entire commodity speculation arena is barely regulated! Who’d have thought?
“Absent strong and sweeping reform, we will continue to witness extreme price volatility and excessive speculation,” said a letter to Congress from The Commodity Markets Oversight Coalition. “Trading will continue to grow in 'dark' or unregulated markets and investment speculators will continue to elude federal oversight, data reporting requirements and position limits.”
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Keep Eye on the Flu Bug
June 11, 2009
Planning to go somewhere this summer? May want to rethink that plan.
The World Health Organization (WHO) is on the verge of declaring the first influenza pandemic in more than 40 years.
You’ll remember that whole swine flu thing, which was front-page news for weeks back in April – until we got distracted by…what was that again? Anyway, after we stopped paying any attention, thousands upon thousands of new cases of H1N1 popped up all over the place.
WHO has a six-position scale of severity for outbreaks of diseases. Sort of like a Richter scale for germ- and bacteria-borne illness. Well, right now it’s sitting at 5, and the WHO is ready to go full red alert.
North America – particularly Mexico – has been hardest hit. Australia now has more than 1,000 cases. China is believed to have been hit hard, though there are no official reports. Japan is battling pockets of flu outbreaks. In all, the H1N1 virus has hit more than 26,500 people in 73 countries.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
You Can Call Him Doc
June 5, 2009
Big kudos to USW International President Leo Gerard, who is receiving an honorary doctor of laws degree from the University of Guelph next Thursday.
A native Canadian and son of a union miner, Gerard started working at nickel smelter in Sudbury, Ontario at age 18. He rose through the ranks to now lead one of North America’s largest labor unions.
Argue as you will about his tactics and incendiary pronouncements, but a honorary doctorate from one of Canada’s leading universities is nothing to sneeze at.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
And They’re Off…
June 9, 2009
Speaking of the USW, as of June 8 all of the Big 3 tiremakers will be in formal master contract negotiations with the union.
Goodyear and the USW started their meetings on June 1 in Cincinnati, and with Michelin talks began the same day in Lexington, Ky. Bridgestone and the union begin their talks Monday in Louisville.
While a bumpy ride is not expected, one never knows.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Boing, Boing
June 5, 2009
So when GM dropped the bankruptcy bomb on June 1, the Dow Jones Industrial Average dropped GM.
Once the second longest tenured of the 30 companies on the DJIA, GM was bounced – along with Citigroup – in favor of Travelers and Cisco Systems. GM had been on the board continuously since 1925, just behind GE, which had held its spot since 1907.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
New Author
June 5, 2009
Tire Review contributor Hank Inman finished his first book – Rubber Mirror – now available through the University of Akron Press.
The 287-pager is a well-researched history of the Rubber Division of the American Chemical Society, which is celebrating its 100th anniversary this year.
As a history, Rubber Mirror is a great read. Pick one up through www.uakron.edu/uapress.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Pot, Kettle…You Get the Picture
June 3, 2009
This is a long one, so saddle up.
On Monday, the well-read Huffington Post blogsite carried an opinion piece from Leo Gerard, president of the United Steelworkers, who waxed poetically about the importation of passenger tires from China.
As you know, the USW has filed a complaint with the U.S. government seeking sharp limitations on these imports, complaining…well, I’ll let Leo explain before I go on. Here is his blog offering from Huffington Post:
Chutzpah and Cheaters Partner to Keep American Tire Workers Unemployed
Leo W. Gerard
President of the United Steelworkers International
A group of tire importers that should be competitors banded together recently to ally themselves with China in a trade case.
Doesn't sound like they're working for the interests of the United States, does it? No, they're not. They're collaborating with China against American manufacturing in general and American tire workers, represented by the United Steelworkers, in particular.
They're opposing the union's petition seeking a limit on the flood of Chinese tires that has so overwhelmed the U.S. market in the past five years that six American tire plants closed and nearly 7,000 American workers lost their jobs.
China cheats in international trade. It does so by manipulating its currency and subsidizing its manufacturing, which results in lower prices for its exports. For the tire importers, calling themselves the American Coalition for Free Trade in Tires, China cheating means higher profits.
After taking up with China, these companies are not the American Coalition of anything. They're the Chutzpah Coalition. Here's the quote that explains why: "If you impose quotas, you harm American jobs because of the impact on all of the people that work for independent dealers." The Chutzpah Coalition lawyer, Jim Jochum of Jochum, Shore & Trossevim had the lack of insight to say that.
What we have here are tire import companies that grew and profited at the cost of American tire plants and American workers now asserting that if they are forbidden from importing limitless tires, then the result will be terribly wrong and unfair because some of their importing jobs might have to be cut.
If imports are limited, preserving thousands of American tire workers' jobs, here's what Del-Nat president Jim Mayfield asked at the Chutzpah Coalition press conference, "What's supposed to happen to my company and my workers?" A call to Del-Nat asking for the total number of employees got this response: 68.
That's chutzpah.
For those unfamiliar with Yiddish, chutzpah is not generally considered a positive attribute. The typical definition goes something like this: A boy kills his parents then seeks the court's mercy because he's an orphan.
In dealing with the Chinese and this coalition, there's reason to believe chutzpah can be deadly. Chinese manufacturers are notorious for cutting corners in ways that proved lethal to consumers. Babies, cats and dogs have all died from melamine-laced milk and pet food from China. In another case, the Chinese manufacturer of Aqua Dots substituted a chemical, which when ingested reacted like the "date rape" drug, forcing a recall of the toy after it sickened American children who put the dots in their mouths, and caused at least one youngster to end up in a coma.
And then there's the tire case. On Aug. 12, 2006, four Philadelphia carpenters were driving home after work when the treads on one of the Chinese-made tires on their van separated. The rollover crash that followed killed two of the men and permanently impaired a third. An investigation showed that the tires, imported by Foreign Tire Sales – one of the members of the Chutzpah Coalition – did not contain a gum strip between belts necessary to prevent tread separation.
Initially, when the National Highway Traffic Safety Administration ordered Foreign Tire Sales to recall the defective tires, the company said it couldn't afford to do that. Foreign Tire said it could pay only 10% to 15% of the approximately $80 million cost of recovering nearly half a million tires. Sure, it could profit from importing defective products. But it wasn't prepared to pay to clean up the mess.
Later, it decided that only 255,000 tires needed to be returned. Ultimately, Foreign Tire was spared when drivers turned in fewer than 20,000 of those tires – less than 8% of the total. Who knows what happened to the remainder of those questionable tires or the people driving the cars they were on.
Foreign Tire, the Chutzpah Coalition and China want to continue importing freely – free trade not fair trade. And Chinese officials have taken steps to ensure that happens. Early in May, according to a report in the People's Daily, China's Vice Minister of Commerce met with U.S. Embassy personnel in Beijing "to negotiate on two trade remedy investigations targeting Chinese-made products that U.S. industries recently filed with the U.S. government."
After that, the International Trade Commission released a memo revealing that Chinese officials attempted to discuss trade cases in a private meeting – a contact that was improper because other parties in these cases did not have an opportunity to argue their side. The ITC memo said China expressed particular concern about petitions filed under Section 421, the China-specific trade safeguard law that the USW used in the tire case.
Here's what is at risk for China and their Chutzpah Coalition allies: in 2004 China sent 14 million tires to the U.S. valued at $453 million. By last year, that had increased to 46 million tires valued at $1.7 billion.
The USW wants the U.S. International Trade Commission to limit the imports to the 2005 level, which was 21 million. That number then could rise by 5% the following year, and 5% more the year after that.
Congress added Section 421 to the U.S. Trade Act in 2000 to give U.S. industries and workers an opportunity to obtain product-specific relief from sharp increases in imports from China. Section 421 could provide resolution more quickly than a dumping or countervailing duty case.
Another good reason to call this group of tire importers the Chutzpah Coalition is that in its news release, announcing its formation, it suggested it represented "thousands of Americans working in the tire industry." Not likely. Two of the six members refused to say how many employees they have – Dunlap & Kyle Co., Inc. and Foreign Tire. But the total employed in the U.S. for the other four together: American Omni Trading Co.; Del-Nat Tire Corp.; Hercules Tire & Rubber Co. and Orteck Global Supply & Distribution Co., is 400.
That's hardly "thousands of Americans."
But they've cost 7,000 Americans their jobs. And they're fine with that. They're working hard every day to add more to that number.
OK, now that Leo has had his say, I want to make a few points – once again.
Before I get started, I do want to say that retaining American manufacturing jobs is important. Producing your own goods helps any economy. But times have changed, while expectations have not. Retaining manufacturing jobs “just because that’s how it’s always been” makes no sense, especially when those jobs result in uncompetitively priced products. Those are not sustainable jobs. Those are jobs just because, and that is equally bad for the economy.
Now, to the teeth of Leo’s argument: The importation of China-produced passenger tires has directly resulted in the closure of six U.S. tire plants and the loss of 7,000 jobs. This is important because certain members of Congress drank the USW Koolaid and repeated these same figures to both their constituents and to the ITC.
As I stated in an April 22 blog item (scroll down to “Another Vague Argument”), those plant closures he mentions had little to do with the influx of China-made tires. Rather, they were the product of tiremakers wanting to retain production of so-called “high-value tires” (which translates into “higher tech, higher priced”) on these shores while pushing the production of so-called “broadline” tires to low-cost countries…like Mexico, China, Eastern Europe, etc.
In two of the USW’s cited plant closures, the plants were shuttered because the union would not come to terms with the fact that bloated wages and benefits were a drag on profits – it cost too much to make the tires here. In another case, the USW negotiated and accepted the closure as part of its master contract agreement. In yet another, the plant in question wasn’t even union represented.
And then there is today’s economy, one in which new tire sales are dramatically down, high-value tires are not delivering high-value profits, and those consumers who are buying tires are (despite what some tiremakers want to claim) looking for the lowest cost, not the best “value.” Fewer tires are being sold, and those that are tend toward the lower ticket end of the sales spectrum.
Even more troubling is that Leo and his followers take aim against a group of importers – the American Coalition for Free Trade in Tires – but fail to even glance into the mirror.
Again, as tiremakers shifted production of low-value tires to low-cost countries – including China – those same companies were among the largest importers and sellers of China-produced tires. But Leo doesn’t even mention that fact..because it doesn’t make for good press. Cooper, Bridgestone, Goodyear – they all produce tires in China that end up here. Conti just got going on its first Chinese plant, so they are off the list. Michelin claims that the Warrior brand tires it produces never make it to these shores, but…
Regardless, the union cannot have it both ways It cannot rail against Chinese tire imports while turning a blind eye to its role and its seeming benign acceptance that its employers are among the “offenders.” Now that’s chutzpah.
So the USW wants its cake – and the way they want it decorated – and they want to eat it too. They want high paying union jobs with companies like Goodyear, Michelin, Conti, Bridgestone and Cooper – now conveniently lumped together as “American tiremakers” – but they apparently don’t want those same companies to be competitive.
The USW demands a three-year quota system, rolling allowed imports back to 2005 levels with 5% annual increases over the following two years. Why three years? Why not five or 10 or forever? What will be different in 2012? Will the USW come begging at the table in 36 months?
Leo and his crew are betting on a Democrat administration and Congress to take his side. Note that growing Chinese tire imports has been an issue for more than the last six months, but the USW wasn’t going to raise the matter when the GOP was in charge.
At the end of the day, a lot more China-produced tires reach our shore today than in 2004; that is the state of the market. Has the influx of China-produced tires resulted in the loss of some union jobs? Probably, but not 7,000 or 5,100 (depending on which number Leo is using today). Not even close.
All anyone should want is for the Congress and the ITC to start asking the hard questions, the potentially unpopular questions, of the union and its supporters. The fact is, China and Chinese tires are not the blame or the problem. The real problems run much deeper, and the union needs to take a good look in the mirror and consider the role that it played in this issue.
If those questions aren't asked, then who really is cheating?
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
The Trouble With Normal is it Always Gets Worse
June 1, 2009
“When things get back to normal….”
That’s a phrase I hear often lately – from dealers, analysts, tire companies and colleagues – usually connected with tire and new car sales.
The core assumption bothers me quite a bit. Just what is or was normal? And given the body of evidence before us, how can anyone assume that “things will get back to normal”?
Normal, I guess, means America will return to its voracious appetite for new cars, and that “pent up demand” for replacement tires will burst the dam and vault us back to the “good old days” of 230 million-plus replacement shipments.
Frankly, I doubt that will be the case with vehicle sales. Tire sales may reach pre-recession levels in a few years time, but I think you can throw away any of those growth charts you’ve been sitting on. There may be some pent up demand, but it isn’t as large as anyone wants to believe, I think.
I have read many articles from various sources, and they all tend to say the same thing: Much like our grandparents’ experiences coming out of the Great Depression, Americans are learning – and living with – a new financial mantra. I expect that when we regain some order – and there are signs that we could be edging that way – I don’t expect a spending frenzy or a return to the kind of conspicuous consumption that we all enjoyed through the 1990s and 2000s.
I suspect that Americans have learned to do without, and do with less. I see a world where credit cards become far less important, where consumers carefully weigh (and save for) purchases, where smaller, more fuel-efficient vehicles will rule the roads, and where America’s long-time love affair with the car comes to a close.
And this consumption reevaluation will spread to all manner of product categories…food, clothing, electronics, services, vacations, etc. In other words, the retail and service sector shakeout will continue for a few more years. Unabated consumption is old school; frugality will be the new normal.
I could be wrong, but that’s the writing I see on the wall today.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Welcome, Canada!
June 1, 2009
The Financial Post told me today that Canada is officially in a recession.
Now before you go all “Where have they been” on our friends to the north, it’s important to note that Canada was relatively unaffected by the core of our financial meltdown – the house of cards that was our housing and investment markets. Their banks and investment houses didn’t jump on the greed wagon, and Canadian home buyers weren’t leveraged to the teeth. Smart, eh?
But, try as it might, Canada cannot totally insulate itself from the sins of others, and that carry-over from the States and Europe has finally poured over the country.
Said FT today, “Statistics Canada will be reporting gross domestic product for this year's first quarter. It's expected to show the second consecutive annualized decline in GDP, meeting widely accepted criteria for a recession.
“Not only is another economic contraction thought to have happened during this year's first three months, it's believed to have been a doozy. Analysts polled by Reuters had a median estimate of a 6.6% decline in 2009's first quarter, which would be the biggest drop since record keeping began in 1961.
“That would follow a 3.4% economic contraction in 2008's final quarter.”
But Canadian analysts say they expect the Canadian economy to start growing again in 4Q 2009. So much like GM’s bankruptcy, Canada’s recession will only last a few months. Same as the Stanley Cup playoffs!
A key indicator, though, is Canada’s unemployment rate, which is expected to hit 8.3% with the upcoming May report, and that doesn’t help. U.S. job losses are expected to be announced this week, and most expect the jobless rate to jump from 8.9% to 9.3%. Ouchie!
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
“A Yellow Light Means….”
June 1, 2009
As drivers, 20% of you flat out stink!
At least that was the finding by GMAC Insurance’s annual survey. According to the study, 20% of American drivers would not pass even a basic driving test today.
I think most of them live near me.
No surprise here – older drivers (regardless of sex) tended to do worse.
Why? Well, with few exceptions, most American drivers haven’t taken a legit driving test since they got their licenses. A lot has changed since those bygone days – for me it has been 34 years – so what we thought knew then doesn’t hold today.
Still, spend 5 minutes on any Ohio freeway and you’ll discover that test knowledge is the least of our problems.
Meanwhile, you might want to have your staff take – and pass – updated driving exams. You might be able to save some insurance money!
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Another Side to Safety Inspections
May 29, 2009
Got a number of letters and comments about my May 2009 column concerning the value of safety inspections to independent dealers in these tough times. And while I stand by my basic premise, a few of you are quite right to suggest that such so-called “courtesy inspections” can also become the expressway to business hell.
Here are two notes I received, from people whose opinions I respect:
Jim...
While I respect you and you are on the top of any list, why such an editorial on safety inspections? We have been doing this since I became a tire man in 1969. Just like checking the air on all of the tires and including the spare. I don't get what's the big deal. I guess that's why we are busy.
Thanks and chat with you soon.
Alpio Barbara
President
Redwood General Tire Service
Redwood City, CA
When I was in the field, just before Bridgestone and Firestone merged, I got to see, first-hand, exactly what PMAs taken too zealously can do to a business. It does not work out like Bill Ihnken describes. That I know for certain. Saw it first-hand!
Maybe the ghosts of Pete Johnson and Lindsay Vaughn have returned in the likeness of Bill Ihnken. Instead of this company store operation, they work at that company store operation.
Pete, Lindsay and others preached the same mantra. It sounded so damn good. It was a miserable failure. Here's how and here's why...
1. Customer comes in for a simple oil change. Not another car in any bay right now. Tech drives it in to the bay and starts off taking off the lug nuts. Thirty minutes later the customer, looking out to see his tires off, brakes being inspected, asks how much longer and what are they doing to my car. The guy behind the counter says they are doing a courtesy safety inspection. It will be about another 20 minutes. So, here's how you run off the customer for good. About one hour into a 15-minute oil change, the tech brings a laundry list of stuff, in priority order just as Ihnken describes, to the counter for the sales guy to sell. In regular P.C. Johnson format, the tech calls the oil change customer over, who is expecting a $29.95 bill, and presents a list of suggested services. The shocks and struts are critical ($680) or you'll wear your tires and front-end parts out. The belts need replacing right away ($180). Those things need to be done now. The other, less critical things are: rear brakes are close to replacement ($600), radiator fluid needs to be flushed and filled ($120), battery guards need to be installed ($26).
If the customer buys this, it will be the last time they do it. Their expectation was to spend $29.95, not $900. If they don't buy it, you still lost them because you wasted their valuable time.
2. Put it on the card. Old Pete used to really appreciate when his guys opened up new credit cards and maxed out the limits all in the same day. The top guys always ate steak at the weekly meeting, and they ate first. Others ate beans. Bring 'em in, get the car for the day, inspect the heck out of it. If it was a woman, they'd scare the crap out of them with safety stuff. Pressure buying. Credit card maxing.
3. After a while of #1 and #2 being done, you start to see less of #1 and #2. Word gets around. Those guys are looking hard to sell you stuff you didn't even ask for. You get a reduction in car counts. And you push harder on the next guy. And so it goes. The snowball grows bigger.
Yes sir, the future looks mighty bright for TBC Retail.
The obvious problem is how to solve the resulting drop in car counts. And that is look for only obvious and related simple things. If a guy comes in for an oil change, he gets a free 21-point inspection or a mini-PMA under hood. Just like what you'd expect at a fast lube. No tires off, no brake inspection. You can add on $35-50 per car. Not so bad. But adding on $245 to an oil change is trouble. It's the Bill Ihnkens and Pete Johnsons that really give our industry a black eye.
Steve Hutchinson
Vice President of Marketing
Toyo Tire USA Corp.
Cypress, CA
I agree with Steve’s assertion that an out-of-control PMA program is doom. Strange as it seems, the day after I got Steve’s note, our friends at Canadian Technician magazine talked about the same issue, and repair shop owners provided a lot of similar feedback.
So I guess the issue is this: restraint and control. A simple 21-point program, a written report with timeframe recommendations, and far, far better customer education is the way to go.
The real problem, perhaps, is that most consumers don’t know boo about cars or tires, so when a $29.95 oil change suddenly becomes a recommendation for $900 in service work, the customer is left with a bad taste in their mouth. The list of recommended service may well be correct, but if its not presented properly the customer is thinking “rip-off” and not “safety.”
I just went through multiple repairs on a few of my vehicles. We go to a local tire dealer, and his guys do a great job with courtesy checks. While this was not a case of a $29.95 oil change gone wild, I did end up with a laundry list of issues that needed attention. We went through the list together, prioritized the work, and moved forward.
If you have a take on this question, we’d love to hear from you too. Drop me a note at jsmith@babcox.com.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Bottom of the Barrel
May 29, 2009
Earlier this year, I told a group of tire dealers that oil prices would stay down in the $50 per barrel range, keeping gas prices in that $2-$2.20 per gallon area.
And I was right…until Memorial Day weekend when oil went into orbit ($65 a barrel) and gas looped to $2.60 a gallon. Not good for already tight wallets!
Apparently OPEC thinks it needs $75-$80 a barrel to be comfortable, and any sign of improvement in our economy is seen as opportunity to push the prices higher.
As our friends at the Heavy Treadin’ blog put it, the rise in oil prices is killing the already fragile trucking industry. For April, truck tonnage was down 13% year-over-year…and that was against a crappy April 2008. Businesses everywhere (including the tire biz) are cutting production and rationalizing inventories, which means less trucks are moving less goods from the factory to the warehouse.
“So, the trucking industry is getting walloped, because physical inventories are way too high,” writes Heavy Treadin’. “Common sense will tell you that this will have a proportionally bad effect on the tire industry. Standard, class 8 semis need 18 tires to run. Less tonnage means less wear on existing tires, with a decreased chance for tire failure. In addition, it means that we will probably see an increase in deadheading, where the tractor makes the trip home without hauling any cargo. Again: No trailer = less wear.
“With crude prices nearing $65 a barrel, and diesel on the rise, some truckers may just opt to stay home. Demand is already at anemic levels. A modest increase in travel could send fuel prices soaring above that mark. The high cost of fuel may begin to eat into what little discretionary income people have left. When it does, you can expect the products on the shelf to stay there even longer, worsening an already bleak picture.”
Well said.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Twitter, Tweets and Twits
May 28, 2009
I am amazed at how ga-ga Americans are over Twitter. Of course, we do love our shiny objects.
Many media and advertising groups rave on and on about how so-called “social media” is the big game-changer now, where e-services like Twitter and Facebook and MySpace are the great new frontier for promoting business and brands.
Perhaps, but (and maybe I am old-fashioned) I have failed to be so convinced. Just how does one leverage such social media to benefit your business? We’re told it will, but details remain highly sketchy…and never deal with B2B. Sure, I can see soft drinks and music and apparel – common consumer brands – benefiting from social media buzz. But just how does that work when one business is trying to sell to another?
Don’t know. This is what I do know, though. In recent weeks a number of companies and individuals have gotten their you-know-what caught in the wringer over their Tweeting. Apparently they didn’t get the memo that Twitter and Facebook and MySpace posts are not private communication. You know, like phone calls and secret meetings in restaurants.
Worse yet, when ad agencies sell their clients on using Twitter vs. proven conventional means to promote products and services in the B2B arena. I have an armload of e-mails from agencies announcing that their clients would be Tweeting “live” from such and such event. As if potential customers have the time to monitor such things…140 characters at a time. Come on.
Confession time: Tire Review is participating in social media. We have a group on LinkedIn, a social media site for business pros. We’re are carefully watching participation to gauge whether there is a real benefit, or if such activities are just wishful thinking. If it proves to be the latter, we’ll be moving on.
Meanwhile, you may want to carefully watch the social media activities of your staffs lest they post anything that can harm your business. They may plead that you are invading their privacy, but public postings can hardly be considered private. It is, after all, your business.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Out of the Mouths of Dimwits
May 28, 2009
I have no idea if this is legit. Frankly, it doesn’t matter cause they are just too funny.
According to the e-mail, these lawyer-witness exchanges are from a book entitled “Disorder in the American Courts.” While it is easy to say that some court players are none too bright, it is often the well-educated lawyers who prove to be dim bulbs.
ATTORNEY: What was the first thing your husband said to you that morning?
WITNESS: He said, 'Where am I, Cathy?'
ATTORNEY: And why did that upset you?
WITNESS: My name is Susan!
****
ATTORNEY: This myasthenia gravis, does it affect your memory at all?
WITNESS: Yes.
ATTORNEY: And in what ways does it affect your memory?
WITNESS: I forget.
ATTORNEY: You forget? Can you give us an example of something you forgot?
****
ATTORNEY: Do you know if your daughter has ever been involved in voodoo?
WITNESS: We both do.
ATTORNEY: Voodoo?
WITNESS: We do.
ATTORNEY: You do?
WITNESS: Yes, voodoo.
****
ATTORNEY: Now doctor, isn't it true that when a person dies in his sleep, he doesn't know about it until the next morning?
WITNESS: Did you actually pass the bar exam?
****
ATTORNEY: The youngest son, the twenty-year-old, how old is he?
WITNESS: He's twenty, much like your IQ.
****
ATTORNEY: Were you present when your picture was taken?
WITNESS: Are you @$&%#ing me?
****
ATTORNEY: She had three children, right?
WITNESS: Yes.
ATTORNEY: How many were boys?
WITNESS: None.
ATTORNEY: Were there any girls?
WITNESS: Your Honor, I think I need a different attorney. Can I get a new attorney?
****
ATTORNEY: How was your first marriage terminated?
WITNESS: By death.
ATTORNEY: And by whose death was it terminated?
WITNESS: Take a guess.
****
ATTORNEY: Can you describe the individual?
WITNESS: He was about medium height and had a beard.
ATTORNEY: Was this a male or a female?
WITNESS: Unless the circus was in town, I'm going with male.
****
ATTORNEY: Doctor, how many of your autopsies have you performed on dead people?
WITNESS: All of them. The live ones put up too much of a fight.
****
ATTORNEY: Do you recall the time that you examined the body?
WITNESS : The autopsy started around 8:30 p.m.
ATTORNEY: And Mr. Denton was dead at the time?
WITNE SS: If not, he was by the time I finished.
****
ATTORNEY: Are you qualified to give a urine sample?
WITNESS: Are you qualified to ask that question?
****
ATTORNEY: Doctor, before you performed the autopsy, did you check for a pulse?
WITNESS: No.
ATTORNEY: Did you check for blood pressure?
WITNESS: No.
ATTORNEY: Did you check for breathing?
WITNESS: No.
ATTORNEY: So, then it is possible that the patient was alive when you began the autopsy?
WITNESS: No.
ATTORNEY: How can you be so sure, Doctor?
WITNESS: Because his brain was sitting on my desk in a jar.
ATTORNEY: I see, but could the patient have still been alive, nevertheless?
WITNESS: Yes, it is possible that he could have been alive and practicing law.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Lost on the Wreckage
May 15, 2009
I have never been sure what to make of the story of Tire Works Total Car Care, the Las Vegas-based dealer that is facing deceptive trade practice charges by the Nevada attorney general.
On the face of it, the charges and supposed proof seem rather thin. I saw the written transcript of the local TV station’s expose that inflamed the situation. There was very little substance there. Believe me, between the consumer media and some of our own industry press, Tire Works has been drug well through the muck and mire.
Do they deserve that kind of treatment? Well, I guess that is subject to debate. We have intentionally avoided the entire affair because all of the information I saw on the case, as mentioned above, appeared rather thin.
And now Tire Works owners are suing the state Department of Business and Industry and a former employee (who allegedly assisted the attorney general in an undercover investigation). So you can see this will not end well.
One of the problems with consumer complaints filed with the government is that often times resolution was reached…but not reported to the authorities. Another problem comes when the customer’s version of “customer service” does match that of the retailer. You all know that happens=, and you know the result. Some customers, no matter what you do, will never be happy…and some of them complain.
Did Tire Works do anything wrong? Don’t know. Did consumers and the state overreact? Maybe, don’t know. I do know this: If the state had such compelling evidence that wrong was being done, they should simply shut the business down. Leaving it to try to eke out an existence under these circumstance is unconscionable.
Unless there is hard (and I mean hard) evidence of misdoing, the state (and the press) should not literally destroy a business in the media. What happens to Tire Works if all of the charges are dismissed or disproven? Huh? At what point does this company get to be “innocent until proven guilty”?
I don’t want us to be part of that, which is why we avoid such stories. I know they are interesting and all – and certainly there are lessons to be learned – but unless there is compelling, no-brainer evidence, I much prefer waiting until the final act is played out instead of potentially destroying someone’s livelihood. If that’s bad journalism, so be it.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
It’s Just Right, Eh?
May 15, 2009
The other day, we posted Chris Vander Doelen column on Canada’s Right to Repair proposal from the Windsor Star.
As you would expect, his May 12 column attracted comment from many readers. Well worth reading if you are pro-R2R. Here is a sampling [Editor’s Note: It is best to read from the bottom up because that is the order these comments were posted. Also, all misspellings and damaged grammar are as they appeared]:
Jaded Car Owner
First of all, Roy, you do not work at a dealership. That was just a lame attempt at discrediting dealerships. Shame on you. As to the bill itself, I support it completely. We need guys like Masse looking out for the small guy. And the small guy includes the corner mechanic trying to earn a living.
Roy
I work at a dealership and we are told not to fix minor leaks or report them, as this is warrenty work. We are to report them after the customers warrenty runs out. This way we can get paid the full amount for the repair instead of the warrenty rate which is often much lower. So is a dealership really a good place to get your vechical serviced?
Alex
Rick W, your choice is simple, just don't buy a car from manufacturers who withld the codes. That's the capitalist way. If people really cared enough about it, market forces would drive the manufacturers to release this information. The truth is most "codes" are available, it's just that garages don't have the money to buy the equipment or training. I'd bet $1 that was the case on your trip to Florida. That won't change with this new law.
ROB ROY
You wil probably void your warranty--I guess you must like playing russian roullette with your car--smarten up..
ROB ROY
IT IS JUST NOT THAT EASY.Hit a law button and this happens. This is a killer deal--Masse and the NDP love to bust the rules of free enterprise.. Chris you are a good wordsmith but you all do not know what the hell you are doing here..
RICK W
Alex I see you don't have a clue. In this new age of electronics they can have engine lights go on for the most minor or major things and only the people holding the codes will know if it is serious or minor. And with many dealerships closing, this will leave some people even in Ontario many kilometers away from a dealer .The companies have put these in there to milk us of our cash, time and right of convenience to who we want to work on our car. The dealerships have always competed with the local garages because there are some things only they can fix. By making almost everything a deal item is going to raise the cost of fixing our car and giving them a big advantage. I own a new car and only bring it to the dealer because I know they are up to date on everything, but some people would like the convenience of a garage especially if they live far from a dealer. I went to Florida last year and my engine light went on ,I pulled into a garage off the interstate , they didn’t have the codes so I had to travel 50 miles to the nearest certified dealer hoping it wasn’t serious or closed. Luckily it just had to be reset. Good work Masse!
Butch
I got wacked earlier this week by having a clutch repair on my car, done by my local mechanic. The stability control light went on, and he could not get it off. He had to take it to Honda to reflash the system, cost about 60$. This is an outright scam and for once the NDP is bang on. End this ripoff of consumers. If the companies won't play ball, make them do it for free. Good article Chris.
Communism
Now we should be told where we can fix our vehicles? OH MY GO!! This is just too out of hand now. I paid for the dang thing, it's MINE and I should be able to choose where and who will work on my car.
Ugly Kid Joe
I am all for consumer freedom but for something as complicated as todays cars I believe the dealer should maintain them. The dealer should know their cars inside out while shop xyz will need to know ALL cars inside out. Specialized versus Jack of All Trades. I trust my dealer over shop xyz. I brought my car to a local mechanic for a valve adjustment. When they were done the car was noisier than when I brought it in. Had to go back to the dealer to quiet them back down. For basic maintenance any mechanic should be fine. For things that require computer diagnostics it's back to the dealer for me.
Alex
So take away service customers from the dealerships and how will they make their money? They will have to raise prices on new car sales to make up the lost revenue. So owners of used cars get a break (theoretically) on repair costs while new car owners will take the hit. Sounds like another NDP Robin-Hood scheme to me.
Andrew
Well written article. If the manufacturers are given the freedom to with hold this information, you can bet your last dollar ( and I wouldn't do that cause you'll need it for car repairs) that dealership labour rates will skyrocket!
Tom
Excellent article and the most compelling reason I have seen in recent months to buy a GM product. Shame on any manufacturer who uses these sort of tactics to force consumers to use certain shops for repairs and maintanence. Coercion will always bite you in the butt.
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Even Better Than Bartering!
May 15, 2009
At least there is some good news coming out of Congress’ latest effort to re-regulate the credit card industry. You will probably be doing a lot more cash business!
According to a Wall Street Journal story, retailer may be able to set higher prices for credit card users, supposedly to offset the ridiculously high discount rates card issuers charge per transaction.
It has supposedly been illegal to offer lower “cash prices” to consumers, but now Congress is set to return that liberty, finally recognizing that cash customers have been subsidizing the credit card industry for years. Cash customers, as one merchant told the WSJ, has been paying a penalty that only helps credit card users and processors.
We’ll keep an eye on this bill as it moves forward. Meanwhile, better start practicing making change!
If you have comments to share, send to me at jsmith@babcox.com.
– Jim Smith
Just in Case Your Were Wondering
May 12, 2009
It’s worth reviewing (yet again) just why it is so vitally reallyextremely important for the U.S. tire industry to step up and pick adate. Find an age – 6 years or 10 years or whatever – after which atire should not be sold and/or put into service. Picking up on thenational broadcast of one year ago, this ABCNews.com story appeared onApr. 14 of this year. And these types of stories will continue toappear at regular intervals, I am sure, until we do something about it.
States Cracking Down on Sales of Aged Tires
From Hawaii to New York, states across the country are moving toregulate the sale of aged tires, which experts say can prove deadly tounsuspecting motorists. Lawmakers have credited an ABC Newsinvestigation that revealed how outdated tires, even if they appear tobe brand new, can be more prone to sudden, catastrophic failure.
"The story's impact has been very widespread," said auto safety expertSean Kane of Safety Research and Strategies. "It's probably the singlemost important story that's been done on this issue."
Safety experts warn that after six years of age the risk increases fortires to become brittle and dried out, leading to a potential tiretread separation. "It is like a ticking time bomb," said Kane. "Youdon't know what's going on inside, that's what makes it so dangerous."
California Death Leads to Calls for Action
Safety experts have attributed 139 deaths nationwide to aged tires thatfailed. Among those killed was 12-year-old William Moreno of LosAngeles, CA, whose family's SUV rolled over after the tread on an agedtire separated.
In the wake of Moreno's death, California Assembly Member Mike Davishas introduced a bill that would require tire dealers to disclose theage of a tire in writing to consumers prior to the sale or installationof a tire. Dealers would also be required to retain sale documents forat least three years, and violators of the proposed law would besubject to a $250 fine. At a hearing today in Sacramento, witnessesincluding Sean Kane and the brother of William Moreno will testify onthe bill's behalf.
In the 2008 ABC investigation, our undercover tire shoppers found tireswell over six years of age being sold by major retailers. Daviscredited the report with highlighting how consumers are kept in thedark regarding the age of the tires they buy.
"My staff member working on the bill happened to have seen it and wasinspired by it, and felt that this was an issue that she wanted toresearch and bring to the attention of the legislature," said Davis.
In New Jersey, the division of Consumer Affairs is also considering arule that would require dealers to disclose the age of tires to buyers.
'Expiration Date' for Tires
Legislators are also calling for defined "expiration dates" on tiressold. In Hawaii, a group of state senators have introduced a bill thatwould prohibit