No More Excuses

Goodyear lays it all out at first combined dealer meeting

With nearly 5,000 people in attendance at a 105,000-square-foot trade show, Goodyear’s January dealer conference was truly a massive event. It was also a watershed event for the tire maker as it was the first time Dunlop, Kelly-Springfield and Goodyear brand dealers gathered for the annual event. And the first time many of them were briefed on the company’s G3 multi-brand strategy and what it could mean to their businesses.
Declaring this “the year of the customer,” Bill Sharp, Goodyear’s president of North American Tire, opened the two-day conference admitting that ®1999 was more than a disappointment® to dealers and the tire maker.
“I’m not going to make excuses for what happened on the supply side with our fill rates because what happened and why are not what is really most important today,” Sharp said.
“What is important is that you understand completely what has been done over the last six months to correct mistakes that have been made, and that you walk away from here with enough belief in our team and our plans to give us further consideration.”
Sharp reviewed the key areas that Goodyear has targeted for improvement, updating the dealers on the progress made since last November.
®′ Cut 28 percent of product codes — 2,160 product codes in all ®” and redirected the recaptured production capacity to branded lines.
®′ Capped OE tire sales at 1999 levels to “assure equitable allocations for the replacement business.”
®′ Scrapped OE downstream tires that don’t have an immediate market, freeing additional plant capacity.
®′ Redirected capital investment to plant modernization projects to “improve the efficiency of OE yields by 20 to 25 percent.”
®′ Reducing the number of warehouses from 35 to 20 by mid-2000.
®′ Geared up the formerly doomed Gadsden, Ala., plant to increase total production by six million units.
®′ Increased capacity earmarked for North America at plants in Europe and South America, and operating “all our own plants at 100 percent capacity.”
®′ Adding curing presses and tire building equipment at Goodyear truck tire facilities, and “taking advantage of capacity available from our Dunlop friends in Buffalo.”
These moves, according to Sharp, will get Goodyear the nine million additional tires it will need to meet anticipated 2000 demand.
“I am not going to stand here and say everything is perfect,” said Sharp. ®But I will say that we have all the pieces in place to play this game, and there is no excuse for not winning. None.®
Marco Molinari, vice president of sales and marketing, with help from Dr. Louis Stern, marketing professor at Northwestern University, and others, further outlined Goodyear’s new G3 multi-brand strategy.
While most of the focus was on how and why Goodyear was positioning each brand, dealers were told that the dealer and mass merchant channels would have separate and distinct products and lines. Dealers were very curious as to how the G3 program would impact them with regard to what brands and lines they could carry. Molinari said each dealer retail location would be evaluated individually to determine its strengths and the strengths of their market areas, where the dealer wants to go, and what the market opportunity is. Goodyear would then recommend brands and lines that would offer the dealer the greatest opportunity for success.
Goodyear plans to integrate “as many programs, like co-op advertising and volume bonuses” as makes sense for the dealers benefit, according to Brandon Stotsenburg, general manager of Kelly brand sales.
“But we don’t want to hurt the advantages some dealers have earned with one brand or another,” he said. Dealers who want to carry multiple brands under the G3 program can have their programs combined.
Further, Goodyear is “not requiring any kind of in-house share at this time,” according to Chuck Mick, vice president of dealer sales for Goodyear’s North American Tire unit.
Goodyear also introduced a number of new products and programs during the conference:
®′ Goodyear Club, made in Europe, replaces the T-Metric and Decathlon lines as an entry price-level tire, and will be available in 12 sizes from 155/80R12 through 185/65R14.
®′ The Kelly Safari SUV, an S-rated SUV tire, will be available in the second quarter of 2000 in 11 P-metric sizes, and will carry a 50,000-mile warranty.
®′ Goodyear Eagle #1 NASCAR, which features the tire maker’s distinct racing yellow lettering and the familiar NASCAR logo, will be initially available in P205/65R15, P205/55R16, P235/55R16 and P225/60R15, with four additional sizes coming later.
®′ Wrangler Express Program guarantees to deliver premium Wrangler tires to dealers within two days. The Wrangler RF-A will be the first light truck tire available via the service, which started Feb. 1.
®′ Goodyear G372LHD line haul radial truck tire, available in sixes 295/75R22.5 and 285/75R24.5 (with conventional 22.5 and 24.5 sizes available in the spring), features Goodyear’s new Enhanced Casing Design technology and a 30/32nds tread depth for maximum mileage.
®′ Goodyear Rawhide ATT tire for ATVs, will be available in three sizes. And the Mud Runner ATV will now be available as a run-flat.®′