TREAD ACT BATTLES
NHTSA Delays Standards, Faces Suit
Feeling heat from all corners of the tire and auto industries, NHTSA has decided to delay until at least September a final ruling on its controversial proposed upgrade of tire safety standards. Meanwhile, consumer safety groups sued the U.S. Department of Transportation June 26, saying that NHTSA’s compromised tire pressure monitoring system (TPMS) rule allows automakers to use inadequate technology that will fail to prevent accidents.
Federal Motor Vehicle Safety Standard 139, as NHTSA’s proposed tire testing regulation is officially named, would replace the three-decade-old FMVSS 109 standards currently in force. The Tire Industry Association (TIA), RMA, SEMA, a number of specialty tire manufacturers, a handful of congressmen and senators, the Alliance for Automobile Manufacturers, and others have all loudly objected to NHTSA’s proposed tire testing standards, saying they are either too harsh, too expensive, too encompassing or don’t consider the potential impact to passenger vehicles.
NHTSA issued its FMVSS 139 proposal in March and was expected to issue its final ruling by June 1. Now, it may been winter before the agency can create a proposal that will pass muster with tiremakers, auto companies and the White House, which has already struck down one NHTSA proposal.
Despite NHTSA Administrator Dr. Jeffrey Runge’s assurances that the agency plans to "raise the bar" on tire testing standards, no one other than a handful of consumer safety groups favors the current FMVSS 139 proposal. U.S. tire safety standards have not been upgraded since 1968, well before radial tires were widely produced and sold.
FMVSS 139, among other things, would require new passenger vehicle tires pass a series of significantly sterner laboratory and field durability tests than called for under current regulations. The RMA says that its analysis shows that some 42% of passenger tires and more than 50% of light truck/SUV tires on the road today may not pass the proposed testing upgrade. NHTSA claims than only 30% of all passenger vehicle tires would fail the tests.
But RMA claims that NHTSA’s own data shows that only 414 deaths and 10,275 injuries can be directly tired to tire failure. NHTSA claims its proposed ruling would save 27 lives and prevent 667 injuries per year.
In addition, the FMVSS 139 testing proposal could significantly harm makers of low volume specialty tires like Denman Tire Corp., Hoosier Performance Tire and Specialty Tire of America, which produce bias-ply light truck and trailer tires and DOT-approved race tires. All three have requested an exemption from the testing rule, claiming the added testing costs could put them out of business.
NHTSA’s controversial TPMS regulations, which allows both indirect ABS-based and direct wheel sensor-based tire inflation monitoring, will new be reviewed in Federal court. Public Citizen, the Center for Auto Safety and the New York Public Interest Research Group sued the DOT in the Second Circuit Court of Appeals, saying NHTSA put the interests of the auto industry ahead of public safety when creating the rule.
NHTSA’s May ruling requires that vehicles built after November 2003 have a dashboard warning to alert drivers when their tires are underinflated. NHTSA originally proposed that required direct monitors in each wheel be used, but the White House insisted the rule be changed to allow a less-expensive indirect TPMS, favored by automakers.
TANA & ITRA Merger Done Deal; TIA New Name of Industry Group
The U.S. tire industry woke up July 1 with a "new" trade association – the Tire Industry Association – that plans to be more inclusive and aggressive than its previous incarnations. July 1 marked the official merger of the Tire Association of North America and the International Tire and Rubber Association, and announced its new name and logo at an Akron press conference June 24.
The new name, which features no specific reference to either a geographic area or a particular tire industry segment, was chosen "because of its inclusive nature and simplicity," said Ross Kogel Jr., executive vice president of the Tire Industry Association (TIA).
The "new" association, according to Tom Raben, the former ITRA president who will take the reins of TIA in November, is looking to represent virtually all aspects of the tire industry, including retail and commercial dealers, retreaders, tire and rubber recyclers, tire and rubber suppliers, tire service and repair professionals, manufacturers, wholesaler/distributor, wheel and rim specialists, truck stop operators, service station dealer/operators and tire equipment marketers.
Raben said the association name was chosen because it mentioned no specific market segments or geographic region.
However, the "new" association has a familiar problem – building membership. "We desperately need the industry’s help," said Steve Disney, TIA’s first president and the former president of TANA. "When non-profit organizations merge, they lose money. The 300 members who belonged to both ITRA and TANA will now pay dues only once – not twice. To effectively maintain our services, we will need the dues donations of our members more than ever before."
While TIA leadership denied the association is in financial trouble, the costs of the merger, the loss of dues from duplicate memberships, and other costs related to the two former associations have strained its coffers.
"There are few investments as worthwhile as membership in your trade association," said Raben. "Now, more than ever, we ask businesses in the industry to support the merger."
Falken Looks to Rebound From Problem-Plagued First Half
Falken Tire Corp. used its dealer meeting in Squaw Valley, Calif., to admit its efforts in the first half of 2002 weren’t up to par. But the tiremaker says it is focused on finishing the year on a high note.
"We had a bad first half of the year, mechanically," Richard Smallwood, vice president of sales and marketing, said to the 32 Falken dealers in attendance. "The machine broke. We failed and we apologize."
The tiremaker said its problems stemmed not from inaction, but from trying to do too much at the same time. "We took on more projects than we should have," Smallwood told dealers, recounting difficulties the company experienced with its new $1.5 million software system, larger-than-expected growth for its Visa brand, and personnel changes in its customer service area.
Even overall sales volumes grew faster than expected, which left Falken short in 18-inch and above sizes, he said.
But it wasn’t all negative for Falken, which experienced 95% fill rates in high performance and ultra-high performance segments last year. The tiremaker will also unveil two more 20-inch sport light truck sizes by fall and will add 14 new 65- and 70-series sizes to its S/TZ04 light truck tire line by 2003.
Falken will continue to increase new niche designs and sizes, and has increased advertising promotions, realigned its customer service and sales departments, and developed a new Web site.
Rabin Worldwide to Auction Off Penske Auto Center Equipment
Rabin Worldwide has been appointed broker for a series of July and August liquidation auctions of the contents of 600 now-closed Penske Auto Centers. The regional auctions will include lifts, alignment systems, tire changers and balancers, brake service equipment, diagnostic equipment, electrical and battery testers, lube systems and more.
Rabin plans some 150 auctions over a two-month period to dispose of the equipment. Details on dates, locations and equipment is available online at www.rabin.com or by calling 800-822-2752.
MNA Replacing 30,000 Phantom Tires
Michelin North America (MNA) is replacing some 30,000 Phantom A/P tires at no-charge in a move the tiremaker insists is "not a recall." The tires, produced by MNA and sold exclusively by Arizona’s Discount Tire Co. between 1997 and 1999, may "come out of service prematurely," according to the tiremaker, in "certain conditions of extreme use" – overloading and underinflation, rough terrain and constant high temperatures.
MNA said some 192,000 of the tires were produced and its estimates that only 30,000 are still in use. Michelin is contacting tire owners via mail and through newspaper ads.
The Phantom A/P tires being replaced include sizes LT245/75R16 load range E, LT235/85R16 load range E, P235/75R15 standard load and P235/75R15 extra load.
Michelin said the replacement effort is purely voluntary. "These tires are not defective and meet or exceed all DOT specifications," MNA said in a news release. "There have been no reported injuries associated with these tires."
Cooper launches Dealer management education program
Described by the company as the tire industry version of an executive MBA program, Cooper launched its new Cooper Advanced Management Program (CAMP) dealer education effort in late May, with 20 dealers participating in the initial session. Run at Cooper’s Learning Center facility at its Findlay, Ohio, headquarters, additional CAMP sessions will be held in October 2002 and the first quarter of 2003.
According to Cooper, CAMP provides instructional courses specifically designed and tailored to meet the needs of independent tire dealers. "Our primary objective is to provide quality business skills training and educational opportunities to our dealers, allowing them to increase their overall effectiveness in managing their businesses for profit and growth," explains Greg Ring, Cooper’s sales and marketing training manager.
The first session covered change management, team motivation and financial management. Future sessions will tackle leadership and performance management, human resource issues, sales and marketing management, legal affairs and asset management. Sessions are taught by Cooper training personnel and management and by outside consultants.
"We want our dealers to be prosperous, not only because their success translates to our success, but because we have long-standing relationships with the people running these businesses," said Tom Dattilo, Cooper chairman, president and CEO.
Goodyear Launches New Rv Line And Web Site
Goodyear is moving aggressively in the RV tire market, launching a new RV-owner Web site, a new RV tire line, and a new tire service option for travelers.
The new RV line – G670 RV Unisteel – is the company’s first custom-designed tire for the Class A and Class C RV markets, said Goodyear. Replacing commercial tires usually used for Class A and C applications, the G670 RV Unisteel "provides a smoother, more comfortable ride," said Goodyear.
Goodyear’s new RVer-oriented Web site at www.goodyear.com/rv provides tire selection and maintenance information for all types of motorized and towed recreational vehicles. The site also provides information to assist users in tire selection, said Goodyear, as well as on tire storage, inflation pressure maintenance, and how RV size and weight distribution impact tires.
The tiremaker is also enhancing tire service options for RVers by training its network of Truckwise commercial tire centers to handle the special technical needs of RVs. Truckwise dealer locations have the tires and equipment to handle large vehicles, said Goodyear. After training is complete, Goodyear will designate qualified Truckwise dealers as Certified RV Service Centers, and they will be available for both regular service and emergency roadside dispatch.
of note . . .
- Del-Nat Tire Corp. expanded its distribution into a 120,000-square-foot building in Memphis’ Mallory Warehouse Complex, and added 3,000 square feet to its headquarters offices.
- Goodyear began construction on a 520,000-square-foot production and warehouse expansion at its Lawton, Okla., tire plant. The $250 million project is being partially funded by the state.
- U.S. District Court ruled that residents of Mexico have the right to file lawsuits in Tennessee against Bridgestone/Firestone and Ford for deaths of injuries in Mexico allegedly caused by defective tires.
- The new edition of the Scrap Tire & Rubber Users Directory is now available via Recycling Research Institute at 860-668-5422.
- Bridgestone/Firestone Off Road Tire Co. was named Manufacturer of the Year by construction and mining firm Peter Kiewit Sons.
- Tire Warehouse opened a new 5,000-quare-foot store in Clinton, Mass., in June and plans two more in Ludlow and North Adams, Mass., by the end of the year.
- Goodyear launched the new H-, V- and Z-rated Wrangler F1 performance tire, with 16- to 22-inch sizes for light truck and SUV applications.
- Canadian investment firm TRC Capital Corp. made an unsolicited tender offer for some 5 million shares of Goodyear stock in late June. The $19.50 per share offer, according to analysts, was simply a move to make a quick profit.
- Cooper Tire raised prices on its radial medium truck tires by 5% effective July 1, the same day Kumho Tire USA’s 3% increase on its truck tire prices also took effect.
- Michelin OTR tires are now available via the Internet through an e-commerce agreement with Quadrem, an e-commerce system for the mining and quarry industries.
- In mid-June, Goodyear filed with the SEC to sell as much as $2 billion in debt, stock, warrants, contracts and units in a move to fund capital spending and acquisitions, and reduce overall debt.
- International Marketing Inc. is the newest member of the Tire Retread Information Bureau (TRIB).
- Yokohama added three sizes to its Parada Spec 2 line – 205/40ZR16, 215/35ZR19 and 225/35ZR19. The 14-size line carries a UTQG of 300 AAA.
- New 56-page AAIA 2002-2003 Aftermarket Factbook is now available – $75 for AAIA members and $150 for non-members – by calling 301-654-6664 or on-line at www.aftermarket.org.
- Bandag paid $40.2 million to buy some 1.5 million shares of its own stock back from Lucille Carver, widow of company founder Roy Carver Sr. and mother of chairman, president and CEO Martin Carver.
- Vernald Cole of Remus, Mich., pleaded guilty in mid-June to a felony count of selling used and damaged Firestone Wilderness radials that had been recalled by Ford last year. He could get 10 years in prison and a $20,000 fine.
- ArvinMeritor donated $150,000 to a fund-raising campaign to construct a $5 million Automotive Aftermarket Industry Education Center on the Northwood University campus in Midland, Mich.
- Michelin North America settled with the family of a Mexican couple killed in a Ford Explorer rollover accident plaintiffs claimed was caused by a defective Uniroyal tire. The tire was 13 years old, had been improperly repaired, and was taken from another vehicle and mounted on the Explorer just days before the June 2000 accident.
- Shareholders passed a non-binding resolution at Goodyear’s annual meeting calling for directors to be elected every year; 73% of all shares approved the resolution, and it was the second straight year the proposal was passed.
- Continental Tire North America is title sponsor of the new Continental Tire Bowl, a NCAA bowl game scheduled for Dec. 28 at Ericsson Stadium in Charlotte and broadcast on ESPN2.
- Advance Auto Parts awarded Bendix Brakes with its 2001 Vendor of the Year award at its Managers’ Conference in Orlando, Fla.
- Countrywide Tire & Rubber is providing its Rubber Master line of innertubes, flaps and specialty tires to Hercules Tire & Rubber Co.
- European Bank For Reconstruction And Development is providing $20 million to Michelin Russian Tyre Manufacturing, giving the bank a 49% share in the plant at Davydovo.
- Reports indicated that Goodyear would close its 150-worker tire mold plant in Stow, Ohio.