A New Era Begins - Tire Review Magazine

A New Era Begins

Kumho Tire USA is embarking on a new era in 2016, Harry Choi, its president and CEO, told tire dealers during Kumho’s recent dealer meeting in St. Lucia on Dec. 3.

Harry Choi, Kumho Tire USA president and CEO
Harry Choi, Kumho Tire USA president and CEO

The tiremaker underwent several major changes in 2015 including a headquarter relocation from Rancho Cucamonga, Calif., to Atlanta, a major employee turnover, and working to get its new North American tire plant in Macon, Ga., on stream.

“I’m sure all of you have noticed some major changes within our operations. Unfortunately when a company makes great changes, the kind of changes we have made and are still making, the first things customers notice is not the good,” Choi shared.

Over that period, dealers experienced several challenges including calls not being returned on time, orders taking a longer time to fill and sales reps changing. Choi apologized to dealers for the challenges, and thanked the dealers for their patience with the company.

Choi said 2016 brings rewards for the tire dealers’ patience and hard efforts – a new era for Kumho.

The company has a new headquarters and tire plant, is releasing several new tires in 2016 and is revamping its marketing efforts.

“We have been working towards this new era for quite a while. Throughout all the planning and all the hard work, there is one message I’ve repeated over and over to our team: Cha, cha, cha,” Choi said.

“Cha, cha, cha” stands for challenge, change and chance.

“We have challenged ourselves to reinvent our organization and brand in North America,” Choi continued. “We have made changes to begin a new tire era in North America, both Canada and the U.S. This new era gives us the chance to start fresh and build a better company, be a better partner and deliver to our customers.”

With the new era also comes a new slogan for the tiremaker: “Kumho Tire Better All-Ways.”

“What does better all-ways mean?” said Jim Mayfield, vice president of sales and marketing. “It means today our goal is to be better than we were yesterday. It means tomorrow our goal is to be better than we are today. Every day as we start the day our goal is to be better. To get better it means you’re not where you want to be yet. And we’re not where we want to be yet.”

Georgia HQ, Plant

During a post-meeting interview with Tire Review, Mayfield emphasized the importance of Kumho’s 2015 rebirth for 2016 and beyond.
“2015 really was the reset button for Kumho Tire USA. We made a lot of changes: changes in personnel, changes in headquarters, and new products for the first time in five years. This prepared us to move into 2016,” he shared.

One of the largest changes in 2015 was the relocation of the headquarters. This relocation lead to an almost whole new North American team for the tiremaker.

“We lost 80% of our employees,” Mayfield shared. “So 80% of the employees now are brand new to the company, and they want to prove something and accomplish something. There’s a whole energy level that we see every day in the office that has been very positive.”
The main reason for the relocation of Kumho’s headquarters is the opening of its new plant in Macon, Mayfield said.

The factory is slated to start producing tires in January 2016 and ramping up production slowly. By the time the plant is fully functional, it’ll produce 4 million tires annually, Mayfield said.

While the majority of the tires produced in Macon will be OE tires, the replacement market will benefit by another plant being built.
“Macon will open up production in our factories in South Korea and Vietnam for us to be able to get more large wheel diameter sizes,” Mayfield shared. “The larger diameter sizes are becoming more popular and more in demand. We have to be able to keep up. That’s been an issue in the past for us… The factory in Georgia gives us the opportunity to do that.”

New Products

One goal Kumho is working toward this year is increased marketshare. The tiremaker hopes to boost its share in the market through new products, targeted pricing, and a more focused marketing effort, Mayfield said.Kumho

In 2015 Kumho launched six new products, and in 2016 the tiremaker shows no signs of slowing down. During the dealer meeting, Kumho announced four new lines for the North American market.

“The new products that we’ve introduced in the last 18 months and in 2016 have been developed and targeted for the United States market,” Mayfield said. “That’s key for us. We have to have products targeted for this market. Our market is different than many markets around the world… I’m really pleased to say that every single product was developed for this market, and that’s going to serve the consumers the way that they deserve to be served.”

In March 2016, the Ecsta PS91, Ecsta PS31, Crugen HT 51, and Crugen HP91 will be available to the North American market.

The Ecsta PS91 will be the premium summer UHP offering from Kumho. The tire features an asymmetric tread pattern and is available in a Y speed rating. The PS91 will be available in 49 sizes in 18- to 22- inch wheel diameters.

The Ecsta PS31, also a summer UHP, will be the tiremaker’s value product for the segment. The tire features a directional tread pattern and comes in a V and W speed rating. The PS 31 will be offered in 49 sizes, 14- to 18- inch wheel diameters.

The Crugen HT 51 is a light truck/SUV all-season tire designed with an asymmetric tread pattern. The tire is available in 39 sizes, 15- to 20- inch wheel diameters and comes in three speed ratings: R, S and T.

Crugen HP91 is a light truck/SUV summer tire. The tire will be available in 51 sizes, 16- to 22- inch diameters, and in speed ratings of H,V, W, and Y.

Kumho plans to support its new tires with consumer promotions, Mayfield said.

The tiremaker has put in a “tremendous amount of work” making sure the products are properly positioned in the market, Mayfield said. Kumho has hired a pricing manager to review Kumho’s position in the market and help the tiremaker make sure its products are properly priced.

“Our position is essential. Maintaining our position and making sure our pricing supports are where we have to be,” he shared.

Dealer Support

Kumho is also taking several steps in the new year to better support its dealers.

One of these steps is a new Premium Fuel dealer portal. The tiremaker is in beta testing for its new Dealer Portal 2.0, which will be set to launch sometime in the first quarter.

The new dealer portal will have more up-to-date information than it’s had in the past. A dealer will be able to go online and see where they are at all times in the Fuel program, Mayfield said. Kumho is also exploring having secondary suppliers available to its Fuel Dealers.

“Dealers have a primary supplier – which we think is critical and that primary supplier deserves all the support we can offer to them – but in case they don’t have the tires, we need to have tires available for that Fuel Dealer,” Mayfield said.

Kumho has also answered its dealers’ requests for tagable assets. The tiremaker is making videos, ads and more available to dealers for co-branding.

Kumho will also be taking advantage of its NBA sponsorship in 2016 with local team sponsorships, Mayfield shared. The tiremaker did not say which teams it’s in negotiations with, but said the local sponsorships will lead to more dealer activation opportunities.

Mayfield also noted that 2016 will bring faster credit processing. Kumho hasn’t been working at full staff for a while, and with new employees Kumho will be able to improve its credit processing time. Additionally, Kumho’s division sales directors have been given the authority to make marketing decisions in the field,” he shared.

“I think you’re going to see a better effort and a better result,” Mayfield shared. “We’re getting back to where we are fully staffed and are going to be able to support the programs that we have in front of you. You’ll see a much quicker turnaround in getting those credits issued and supporting the decisions you’re making in your business.”

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