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TIRES UNDER FIRE – AGAINContis, Generals, Dunlops and Firestones Eyed

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TIRES UNDER FIRE – AGAIN
Contis, Generals, Dunlops and Firestones Eyed
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Light truck tires remain under close scrutiny with the recent recall by Continental Tire North America (CTNA) of OE tires on some Ford Excursions and Lincoln Navigators, a new NHTSA probe of some Dunlop tires that were OE on Nissan Pathfinders, and a California attorney’s call for another Firestone recall.

In mid-July, NHTSA launched a formal defect investigation into P265/70R15 Dunlop Grandtrek TG35s produced between 1995 and 1999 that were OE on Nissan Pathfinders sold between 1996 and 1999. NHTSA said it had three tread separation complaints about the tires. No timetable for the probe was stated. The Dunlop brand was bought by Goodyear in September 1999.

In mid-August, attorney Joseph Lisoni filed a class action suit against Bridgestone/Firestone Americas Holding to force the company to recall millions of Firestone Steeltex A/T, R4S and R4SII radials, tires previously cleared in a detailed NHTSA investigation last year.

Lisoni had no specific tire-related accident or injury client involved, and appeared to be fishing around for such with his lawsuit. He established a Web site to collect alleged Steeltex-caused incidents from consumers.

On Aug. 19, CTNA began a voluntary recall of 595,000 P275/60R17 Continental ContiTrac AW and General Grabber AWs that were OE on over 106,700 2000 and 2001 2WD Excursions and Navigators. The recalled tires have DOT codes 109 to 4400, and were produced between March 1999 and October 2000. CTNA said that 60,000 were also sold into the replacement market. The recall will cost CTNA about $30 million, according to estimates.

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Ironically, nearly 82,000 of the vehicles impacted by the CTNA recall had incorrect tire inflation labels. The erroneous labels called for a rear tire pressure of 30 psi, when they should have stated 33 psi. Ford had no explanation for the error, but was sending corrected labels to consumers.

CTNA told NHTSA that reported problems with the tires include tread separations, uneven wear and harsh vibrations. CTNA said it had information on several incidents that may have been tire related, including a fatal crash in California that killed six people.

CTNA’s toll free recall question line (800-847-3349) was flooded with calls on the first day of the recall, prompting the tiremaker to add phone lines. Affected consumers were also to get notifications by mail, and CTNA put recall information on its www.contigentire.com Web site.

In a separate action, CTNA also recalled 3,505 Continental 315/80R22.5 154/150MHSR1 tires, produced from September 2001 to June 2002, used "in a specific commercial application on certain buses," according to the company.

Goodyear Reorgs North American Tire Unit, Rests Control With Polhemus
Goodyear has reorganized its North American Tire unit once again, reassigning the head of its consumer tire group and placing complete responsibility in the hands of unit president John Polhemus.

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Jim Vogel, promoted to vice president of the group’s consumer tire operations less than a year ago, was placed on special assignment reporting to Goodyear President Robert Keegan. In addition, Jack Winterton, director of field sales; Tom Gravalos, director of corporate accounts; Bill Gaudet, director of Dunlop brand sales; Michael Kitz, vice president of consumer marketing, as well as the unit’s retail, OE, commercial and agricultural tire operations now report directly to Polhemus.

According to a statement, Polhemus said this most recent reorganization is "intended to flatten the consumer organization, to improve customer focus of top management and to speed the decision-making process."

The North American Tire unit was restructured just last December when it was split into four business groups in an effort to improve decision-making and market responsiveness. This latest move further flattens the organization, with all segments – consumer OE, consumer replacement, commercial tire, and retail stores – reporting directly to Polhemus.

Rome in Now Home to Pirelli as Officials Help Open New HQ and Plant
Surrounded by state, county and local dignitaries, employees and local media, Pirelli Tire North America (PTNA) dedicated its new headquarters and MIRS tire manufacturing plant in Rome, Ga., Aug. 17.

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The 400,000-square-foot plant – operational since June – is expected to employ 250 production workers and 50 corporate personnel. The automated MIRS (Modular Integrated Robotized System) plant is Pirelli’s first outside of Europe. Currently, the Rome facility operates three MIRS modules, but has plant and land space to add others as needed.

The festivities included Georgia Governor Roy Barnes, Floyd County Commission Chairman Garry Fricks and Rome City Commission Chairman Ronnie Wallace, who assisted PTNA President Gaetano Mannino in the ribbon cutting ceremony.

Special Events, Educational Seminars Again On Tap For ITE Show
The upcoming International Tire Expo (ITE) will once again include a number of exciting special events and educational sessions for dealers. Operated by the Tire Industry Association (TIA), the ITE runs Nov. 5-8 at the recently renovated Las Vegas Convention Center.

Kicking off the week-long convention and trade show will be the traditional Gala Reception, sponsored by Tire Review, Toyo Tire USA Corp. and GE Card Services, scheduled for Mon., Nov. 4 from 6:30 to 9:30 p.m. at the Harley Davidson Cafe.

The Hall of Fame Breakfast, Tues., Nov. 5 at 7 a.m. at the Aladdin Hotel and Casino, will include the induction of the Tire Industry Hall of Fame class of 2002, and a keynote address by Erik Weihenmayer, the first blind person to reach the summit of Mt. Everest.

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On Wed., Nov. 6, at 7 a.m., also at the Aladdin, the annual Breakfast With the President will feature keynote speeches by outgoing TIA President Steve Disney, incoming president Tom Raben, and Cooper Chairman, President and CEO Tom Dattilo. Cooper will also hold a drawing for $20,000.

ITE registration and tickets for all these events are available through TIA’s fax-on-demand system at 888-889-7391 by requesting document 1080.

Among the educational seminars scheduled is "Successful Tire Dealers Share Their Secrets," a two-part panel discussion on Nov. 5 and 6 moderated by Don Olson. Each session will start at 2 p.m. at the Las Vegas Convention Center, and will allow dealers to ask virtually any question about how these dealers operate.

The Tues., Nov. 5 session will feature panelists Bob Dabrowski, Tire Warehouse Central in Keene, N.H.; Jerry White, White Tire Supply in Beaumont, Texas; Ron Lautzenheiser, College Tire in Ft. Collins, Colo.; Bob Purcell, Purcell Tire in Potosi, Mo.; Paul Swentzel, S&S Tire in Lexington, Ky.; and Dave Komaromi, Tires to Go in West Sacramento, Calif.

The session on Wed., Nov. 6 will feature John Kauffman, Kauffman Tire in Atlanta; Paul Hyatt, Superior Tire in Toronto; Terry Westhafer, Central Tire in Verona, Va.; Chris Wyborny, Ramona Tire & Service in Hemet, Calif.; Charles Creighton, Colony Tire in Edenton, N.C.; and Phil Raben, Raben Tire in Evansville, Ind.

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Other scheduled seminars include Nov. 5 sessions "Improving Retail Tire Store Bottom Line Profits," moderated by Norman Gaither, Norman Gaither & Associates; "Smart Retailing for the Tire and Automotive Store," moderated by Eddy Kay, Eddy Kay Group; and "The TREAD Act: A Government Update," with Becky MacDicken and Roy Littlefield of TIA.

The Wed., Nov. 6 sessions include "Tires of the Future: The Impact on Your Business," lead by Bill Hopkins; and "Retail Tire Advertising: A Common Sense Approach," moderated by Jim Pascover. Sessions on Thurs., Nov. 7 include "Selling with Integrity – How to be a True Professional," moderated by Beau Hamilton of The Hamilton Group; and "The Tire Industry’s Insurance Market: What You Need to Know for Your Business," led by Jeff Fetters of Federated Insurance Group and Jerry McAndrews of Universal Underwriters.

BFNAT Addresses LT/SUV Market with the Bridgestone Dueler A/T Revo
With the Golden Gate Bridge as a backdrop, Bridgestone/Firestone unveiled its newest Dueler – the A/T Revo – on Aug. 1. Designed for light truck and SUV owners looking for premium on- and off-highway tires, the Dueler A/T Revo puts the tiremaker in a better market position, officials said.

"The light truck industry is booming," said Phil Pasci, executive director of consumer tire marketing. "In an industry that’s expecting to see flat to slight growth, we’ve seen an increase in light truck and specifically SUV tires."

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The Dueler A/T Revo is features the tiremaker’s UNI-T AQII technology, which, the company said, gives stronger wet and dry performance when the tire is both new and worn, and a dual-layer tread compound for wet/dry traction and cut resistance.

"The A/T Revo offers pickup truck/SUV owners the best of both worlds," said Shu Ishibashi, president of Bridgestone/Firestone North American Tire’s (BFNAT) consumer tire group. "It has a powerful grip to take on the most rugged routes – even in snow – while still providing a smooth, civilized ride on the highway."

The A/T Revo is available in 27 separate 15-to 17-inch P-metric and LT-metric sizes (Load Range C, D and E), and comes with a 50,000-mile treadwear warranty.

The Dueler A/T Revo will be backed by an aggressive promotion and advertising campaign, including a consumer giveaway, print ads, radio spots and POP materials.

Also at the launch event, BFNAT announced new sizes for its Dueler H/L. The highway/luxury Dueler is now available in sizes P235/65R17 and P235/75R16.

Trib Head Heads Alliance Bid Group
A group of investors that includes TRIB Managing Director Harvey Brodsky made a $50 million bid to buy controlling interest in Israel’s Alliance Tire Co. The formal memorandum of understanding for a 51% share of the publicly-traded Alliance was made in late August, and the due diligence process will likely be completed by October.

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Five people comprise the Harvey Brodsky Group, and a number of behind-the-scenes international investors also involved, according to Brodsky, who says his financial stake in the bid is minor.

Alliance reportedly posted sales of $95 million last year, including some $13.5 million from its U.S. operations, Alliance Tire Co. (USA) Ltd., headquartered in Danville, N.J. Alliance is a top brand in Israel and offers a complete array of tires there, but sells only agricultural and OTR tires here.

Brodsky says if the group’s bid is successful he will take a "slight role with the company," but does not plan to be involved day-to-day. He stated firmly that he remains committed to TRIB and plans to remain as managing director, a position he has held for 20 years.

Alliance has a good management team in place, Brodsky feels, and he doesn’t foresee any changes. At the same time, he said, "Alliance has a lot of opportunities before it, but we obviously think there is room for improvement."

Cooper Expands Dealer Access With New Extranet
Cooper Tire & Rubber Co.’s new free Extranet site gives Cooper dealers secure online access to place and track tire orders, receive invoices, and obtain product and advertising information.

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Cooper officials said CooperWorld.net, available virtually 24/7, gives customers another means of contact with the company. As dealers become accustomed to using the site, Cooper plans to add additional features. Initially the site allows customers to place orders for tires, tubes and other products, track those orders, see and print invoices, check the status of advertising orders, and obtain product information.

"CooperWorld.net uses encryption and secure portal technology to protect the integrity of the site and give customers the utmost in security," according to Cooper special projects manager George Lance. "With the portal, participants are given a username and password allowing for a one-on-one experience every time the site is accessed. Only individual customers will have access to their information – most any time of day, any day of the week."

Treadways Corp. Becomes G3xpress Distributor
Private brander Treadways Corp. and Goodyear have had a long, steady relationship, with Goodyear plants producing much of the marketer’s line offerings. Now, the Treadways/Goodyear relationship has taken a new turn with Treadways Corp. becoming a G3Xpress distributor of Dunlop and Goodyear tires.

All 14 of Treadways’ Laramie Service Centers, including its massive warehouse in Southaven, Miss., are now authorized Dunlop distributors, and six will also take on the Goodyear brand. Laramie is one of the private brands offered by Treadways, and current Laramie dealers will have access to Goodyear and Dunlop products.

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"These agreements represent a very positive step forward for our long-standing, strong relationship with Goodyear," according to Dan Wire, Treadways’ CEO. "The Goodyear and Dunlop brands are two of the best known and respected brands in the world and Treadways is committed to providing the service to help keep them there."

Back in the depths of the Depression, Americans drove tires well into the cords to put off a costly purchase. As a result, there were more deadly accidents, especially on slick roads. Edward S. Babcox, the late publisher of this magazine, started a nationwide tire safety program to help get dangerous tires off the roads and, thereby, boost tire sales for equally hurting tire dealers. It was a big success because ESB got significant tiremaker cooperation and heavily promoted the program for months anywhere and anyhow he could. We think RMA’s National Tire Safety Week, launched this past April, is an equally noble effort with clear benefits to dealers and consumers. And it could be really effective if they started promoting the heck out of it much earlier. The program was announced just over a month prior, leaving no time for trade media coverage let alone consumer media attention. With a year under their belt, we’re sure the 2003 NTSW will be huge.

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Lingering Questions: There’s going to be a 2003 program, isn’t there? Have Ma & Pa Couchpotato heard about this air-goes-in-a-tire thing yet? If a tire fails in the woods, and nobody sees it . . .

TCI Adds Three Centers To Serve T3 Dealers
Tire Centers LLC’s (TCI) T3 Certified Tire Centers marketing program is looking to expand in the mid-Atlantic and southern regions with the opening of three new dedicated distribution centers. The addition of centers in Phoenixville, Pa., Marlboro, N.Y., and Little Rock, Ark., give TCI 29 distribution centers to service the 300 dealers enrolled in the T3 program.

The Phoenixville location will serve a 100-mile radius area near Philadelphia, while Marlboro center will handle T3 dealers in New York City and on Long Island. The Little Rock location will cover state of Arkansas. All will be able to provide daily delivery to dealers in those areas, TCI claimed.

"These new distribution centers are located in geographic areas important to the development of T3," said Dave Snyder, TCI vice president-small tire marketing. "T3 has been a positive factor in the marketplace wherever we have located and now we are bringing our services to these three new regions."

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In addition to the new distribution centers, TCI purchased Reliable Tire Sales, which has three locations across the Baltimore-Washington area. The newly acquired centers will take on the Michelin Retreading Technologies system, according to reports.

of note…

  • Resurgent Bridgestone/Firestone posted first half sales of $3.7 billion, up 2.5% from 2001, and a net loss of only $17 million. Bridgestone Corp. had first half sales of $9.15 billion and net profits of $205 million.
  • Groupe Michelin had first half sales of $7.76 billion, 1.4% better than 2001, and net income of $252.1 million, down 31%.
  • SEMA’s Wheel Industry Council has issued a preliminary wheel installation guidelines and safety poster, which can be viewed at www.sema.org/wicposter. Comments and suggestions by SEMA members are welcome at [email protected]
  • Yokohama offers an "Inch-Up Reference Guide," designed to help dealers quickly calculate plus fitment tire size changes.
  • Industrial Tire Specialists is looking for dealer partners to join its industrial tire buying group. Call 502-724-6673 for information.
  • Goodyear will spend over $100 million in a major modernization project at its Topeka, Kan., tire plant, a five-year effort that will start later this year.
  • Merchant’s Tire & Auto Centers has a new e-commerce Web site – www.merchantstire.com – that allows consumers to select tires and make service appointments.
  • Downloadable Coats and Ammco parts and operations manuals are now available online at www.ammcoats.com.
  • Iron ore producer Cleveland-Cliffs Inc. named Bridgestone/Firestone North American Tire as its Supplier of the Year for the second straight year.
  • The Clemson University Tire Industry Conference is scheduled for Feb. 26-28, 2003 at the Crowne Plaza Resort on Hilton Head Island, S.C.
  • Designed for sedans and minivans, Michelin’s new Harmony carries an 80,000-mile treadwear warranty, delivers all-season performance, and is available in a range of 13- to 16-inch sizes.
  • Carquest Auto Parts’ annual Race for the Race Promotion, which runs through the end of this year, features a grand prize of a 2003 Chevrolet Corvette. Details from your local Carquest outlet.
  • More than 14,000 vehicle repair technicians have enrolled in the Automotive Expert Plus Program, an education and incentive program offered by Tenneco Automotive. Information available at 800-843-4169.
  • West Side Transport, a Cedar Rapids, Iowa-based truckload carrier, selected Bandag to manage the entire tire program for its fleet of 550 tractors and 1,500 trailers.
  • Michelin North America launched a new Web site for its BFGoodrich commercial tire group – www. bfgoodrichtrucktires.com – that includes a dealer locator and databook information on applications, load index, fitment recommendations and dimensions.
  • Cooper settled out of court, for "a very significant amount," according to one plaintiff attorney, a wrongful death suit involving an alleged tread separation-caused rollover accident in April 1999. The Mississippi circuit court judge had been fining Cooper $10,000 per day for failing to make requested documents available to plaintiff attorneys.
  • Fears over the mosquito-spread West Nile virus has caused many communities to force the clean up of scrap tire stockpiles around the country.
  • Pirelli has earned OE fitments on Ford’s 2003 Lincoln Town Car, Crown Victoria and Mercury Grand Marquis.
  • Continental Tire North America is now supplying P225/70R15 ContiTrac radials for the 2002 and 2003 Ford Ranger.
  • Tirecraft Auto Centers is a sponsor of the Calgary Habitat for Humanity’s first Women Building A Legacy house building project.
  • American Tire Distributors posted first half sales of $529.1 million, down from last year’s $569.6 million in sales, but net income rose to $31.1 million vs. a loss of $31.2 million in 2001’s first half.
  • Tire Kingdom bought out North Gateway Tire’s store in Streetsboro, Ohio, and opened new locations in Brookpark, Ohio, Denham Springs, La., and Statesville, N.C.
  • Goodyear will shutter its Stow, Ohio, tire mold plant in October, eliminating some 150 jobs.
  • Shop service equipment maker Gray Automotive Products is celebrating its 50th anniversary this year.
  • Donald Mateer, chairman, president and CEO of Specialty Tires of America’s parent company, Polymer Enterprises, died July 25 at the age of 75.
  • Michelin’s X-One super wide radial is now an option on Volvo’s new VN tractor.
  • Free from labor strife for the first time in years, Titan recorded first half sales of $249.6 million, vs. $256.4 million last year, with net income increasing to $5.1 million vs. a loss of $700,000 in 2001’s first half.
  • Tire Warehouse Central opened a new store in Clinton, Mass., its 51st tires-only location, and plans to open new stores in Ludlow and North Adams, Mass., and Exeter, N.H., by year-end.

Did you know…

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100
Age of the spark plug, patented by inventor Robert Bosch in 1902.

26.2
Percent of those surveyed by Autolite who don’t know when their spark plugs were last changed.

75.3
Million replacement passenger tires shipped through May, up 2.4% vs. same YTD in 2001, according to RMA.

12.8
Million replacement light truck/SUV tires shipped through May, up 7% vs. same period in 2001, according to RMA.

5.3
Million replacement medium truck tires shipped through May, up 6.5% vs. same YTD in 2001, according to RMA.

1.53
Million OE medium truck tires shipped through May, down just 2.7% vs. same period last year, according to RMA.

55
Percentage of off-road consumers who buy suspension and handling components from tire dealers, according to SEMA News.

$13.90
Average hourly wage at auto repair shops in 2001, according to AAIA.

$20.5
Billions in gross sales retail tires represented in 2001, according to AAIA.

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