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With a new three-year labor contract in hand, Goodyear Tire & Rubber Co. turned its attention to other restructuring issues as it works to right its financial ship. The tiremaker formally announced the closing of its Huntsville, Ala., plant, then laid off about 200 employees from its Tyler, Texas, facility.

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ts for the company, had no retiree benefit increases, put a two-year moratorium on pension credits, and "clearly defined cost reduction and productivity improvement requirements at every plant," according to the tiremaker.

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Bridgestone and Michelin officials both approved using the USWA/Goodyear contract as a "pattern" for their negotiations. USWA must still hold talks with Cooper Tire & Rubber Co. and Yokohama Tire Corp. In addition, a reopener clause in the union’s six-year contract with Continental Tire North America went into effect in mid-September.

The contract commits Goodyear to keeping 12 of its 14 union plants open, giving USWA members some security. However, the contract allows Goodyear to cut staffing at any of these plants by up to 15% of August 2003 levels.

Goodyear announced Oct. 6 that its would close the Huntsville plant by Dec. 5, cutting 1,100 jobs. Capacity and job cuts at the Tyler plant, designated with "partial protected status" allowing it to be closed or reduced if it cannot meet certain improvement goals, were revealed Oct. 9 and will be completed by early November.

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The new contract gives the USWA a seat on the Goodyear board – an industry first ®“ and the union won limits on executive compensation and a reduction in the ratio of management to hourly workers throughout North America. In August, Goodyear began cutting 500 salaried, nonunion workers at its North American plants.

Closing the Huntsville plant will cost Goodyear some $255 million in accounting charges, which the company will take in the fourth quarter of this year. The new contract also provides for significant severance packages for displaced workers, and gives workers hiring preference at Goodyear’s Gadsden, Ala., plant.

Goodyear officials said the new deal will save the company $1 billion in "cost savings and cost avoidance" over the life of the contract, and that it meets the company’s "operational flexibility and cost-savings goals."

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CTNA Tries to Stem Losses With Employment, Production Cuts

In a major cost-driven restructuring move, Continental Tire North America (CTNA) cut some 100 jobs at its Charlotte, N.C., headquarters in early September, and eliminated another 200 positions at its Mayfield, Ky., consumer tire plant a month later.

Headquarters jobs, which included some field personnel, were eliminated by the end of September, while the plant positions will be cut by the end of the year. As a result, Mayfield plant production will be cut by some 3,000 tires per day.

A company spokesperson said the layoffs are being made to help the company meet its 2005 profitability goal. According to analyst reports, CTNA needs to significantly reduce its operating costs, and may be looking at other reductions. Analysts said CTNA was on course to post an operating loss of more than $100 million this year. In 2002, CTNA lost some $103 million.

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TRIB Girds For Battle With State Waste Board Over ‘Wasteful’ Manifest Rules

The Tire Retread Information Bureau (TRIB) is pressing ahead in an attempt to exempt California retreaders from the state’s new used tire manifest regulations. Calling the regulations, which went into effect July 1, "wasteful and inaccurate," TRIB Managing Director Harvey Brodsky said the group would seek legal and legislative assistance to change the regulations.

Brodsky and TRIB members have held numerous meetings with members of the California Integrated Waste Management Board (CIWMB), which is administering the regulations. The meetings, according to Brodsky, while cordial have resulted in no reconsideration by the board.

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The controversial regulations require anyone who transports 10 or more "waste" tires – including those earmarked for retreading ®“ to document each and every tire hauled, from the minute they take possession of the tires through their final destination. The idea behind the regulation is to discourage illegal storage and dumping of waste tires.

Retreaders who pick up casings from customers are included in the regulations, even though they don’t own or control the casings. Fines of up to $25,000 can be levied against anyone who does not comply with the regulations’ elaborate manifest and trip log requirements. TRIB and state retreaders contend the additional paperwork required is a significant financial burden; some retreaders have told Brodsky they estimate that complying with the regulations could cost them as much as $60,000 per year.

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At TRIB’s last meeting with the CIWMB, board member Steve Jones told Brodsky that his "hands are tied," and that he could do nothing to change the regulations. He suggested TRIB and retreaders lobby state legislators to seek a change in the law.

"The reason we are taking this so seriously is because regulations formulated in California have a way of spreading to other states, which is about the last thing our industry needs," Brodsky wrote in correspondence to TRIB members. "If we are successful in California, all retreaders in other parts of the country will be better off for it. If we lose, we can say we went down trying."

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TRIB has reportedly approached the Tire Industry Association and other dealer groups to garner support for lobbying efforts. Brodsky said a number of unnamed retreaders have come forward with offers to help fund legal and lobbying efforts.

NHTSA Goes Back to Drawing Board on TPMS Regs, But Not to Tiremakers

NHTSA decided against appealing a federal court decision striking down its controversial tire pressure monitoring system (TPMS) regulations, and instead has begun gathering input aimed at creating a entirely new TREAD Act-mandated TPMS rule.

In August, the U.S. Second Circuit Court of Appeals ruled that NHTSA’s 2002 TPMS rule did not meet Congress’ intent to improve tire safety. NHTSA’s original final rule would have allowed automakers to install either an indirect TPMS – considered to be less expensive ®“ or a direct system. The TREAD Act rule was to have taken effect with 2004 model year vehicles, and would have been incrementally implemented until all new passenger vehicles featured a TPMS.

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NHTSA’s Sept. 9 decision that it would not go to the U.S. Supreme Court in a move to overturn the appellate court ruling was not considered a surprise. NHTSA sent letters to automakers and TPMS suppliers – not tiremakers ®“ seeking their input toward a new rule. Responses were due back to NHTSA by Oct. 17. Based on the appeals court ruling, it is expected that NHTSA will favor a direct TPMS option.

Meanwhile, U.S. tiremakers renewed their call for even safer standards after a new study indicated that TPMSs would make American drivers less likely to even check tire inflation pressure. The Rubber Manufacturers Association-backed study showed that the frequency of U.S. motorists checking tire pressure would likely drop by nearly 25% in TPMS-equipped vehicles.

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The RMA has advocated that passenger vehicle tires have a "reserve inflation pressure," where a vehicle’s tires would be required to have a recommended inflation pressure that would be sufficient to carry the vehicle’s maximum load even if the tire loses a significant amount of pressure. This would provide a vital safety net to drivers, as only 14% properly check their inflation pressure, according to a February 2003 RMA survey.

TIA Taps Universal Underwriters For New Member Insurance Offering

Tire Industry Association (TIA) and Universal Underwriters Insurance reached agreement in early October on a new program that offers insurance coverage to TIA members across the country. The insurance program, which TIA officials said "offers the most comprehensive coverage available to the tire, rubber and transportation industries," includes employee benefit, property and casualty, pollution liability, life insurance and worker’s compensation coverage options.

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Universal Underwriters is now the sole recommended business insurance carrier for TIA, with the exception of the current products liability insurance program for retreaders which remains with Scottsdale Insurance Co.

The insurer will also provide loss prevention materials and advertising materials to TIA for mailings to members, participate in TIA conventions and conferences, and will help promote the TIA’s training and certification programs.

For more information, contact Universal Underwriters at 800-840-8842.

TIA Members Elect 14 to Board; Westhafer Resigns After 25 Years

The Tire Industry Association (TIA) members filled 14 seats on the association’s board of directors, and chose another to fill a vacancy created with the resignation of long-time board member and former American Retreaders Association president Terry Westhafer.

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Four of the available board seats were elected for two-year terms, and the other 10 seats were elected for three-year terms. Elected to serve two-year terms were Garry Heintschel of Heintschel Tire & Service Centers Inc., Texarkana, Texas; Chip Huber of Q Fix Truck Service, Louisville, Ky.; Brett Matschke of Richlonn’s Tire & Service Centers, Greendale, Wis.; and Larry Mullins of Brandon Tire, Ortonville, Mich.

Elected to serve three-year terms were Buck Blair of Tech International, Johnstown, Ohio; Dean Bray of Bray’s Recapping Service, Mt. Airy, N.C.; Jimmy Crews of Tire Treads Inc., Jackson, Tenn.; Peggy Fisher of Fleet Tire Consulting, Rochester Hills, Mich.; Tom Formanek of Stellar Industries Inc., Garner, Iowa; Joe Kovac of Kovac Automotive, Davie, Fla.; Jim Pangle of Fountain Tire, Edmonton, Alberta; Larry Sehman of Sehman Tire Service, Franklin, Pa.; Bill Short of Leininger and Short Inc., Ontario, Calf.; and Terry Sparks of Sparks Commercial Tire, Findlay, Ohio.

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Westhafer, president of Central Tire Corp. in Verona, Va., resigned after serving 25 years on the board. "After 25 years of service on the board, it’s time for me to step back and let someone else volunteer," he said. "My support for TIA, its leaders and its staff remains strong." TIA’s Executive Committee filled the vacancy left by Westhafer’s departure with Daniel Beach of Tire Alliance Group in Oxnard, Calif.

Goodyear Gets Extreme With New Dunlop Rover RVXT LT/SUV Line

Calling it a "multiple application tire targeted at the multi-purpose usage engaged by SUVs and light trucks," the new Dunlop Rover RVXT is "an all-terrain performance tire" with "on-road manners and durable off-road capabilities," according to Goodyear, which launched the new line in mid-September.

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The Rover RVXT – the "XT" stands for "extreme traction" ®“ will be available in 31 different P-metric and LT-metric sizes, including seven flotation sizes, covering 15- through 17-inch wheel diameters. The M+S-rated tire has a UTQG rating of 500 AB, but will carry no treadwear warranty from the tiremaker.

Goodyear officials said the Rover RVXT will replace the existing Rover P-metric and Rover RV lines, and that the new product fits well into Dunlop’s performance heritage. "We’re all about performance," said Roz Kennon, director of Dunlop consumer tire marketing, "regardless of fitment or vehicle."

The new Rover RVXT features a four-rib design with three circumferential grooves to aid water dispersion, and an aggressive tread design that extends down the sidewall for added traction and protection in tough off-road conditions, said Goodyear. Extra-wide steel belts provide stability and durability, the company said.

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"This is a tire that offers incredible adaptability to multiple road surfaces, and excels in a variety of uses," said Kennon. "A 48-pitch, five-element tread design makes it among the quietest all-terrain tires, yet its deep and rugged tread elements equip it for the kind of severe off-road challenges that enthusiasts love to pursue."

 

Going Up: Five More Tiremakers Hike Prices

Five more tire companies increased product prices in recent months, joining Goodyear, Bridgestone/Firestone, Cooper and Continental which had previously announced mid-summer increases to help offset the impact of rising raw material costs.

Kumho Tire USA will increase prices between 3% and 5% on its lines of passenger, light truck/SUV and medium truck tires by an unannounced percentage, effective Nov. 1. Also effective Nov. 1 is an increase of up to 4% by Toyo Tires (USA) Corp. on all of its consumer tires.

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As of Oct.1, Yokohama Tire Corp. boosted prices by up to 5% on its passenger, performance and light truck/SUV lines, and Pirelli Tire North America increased prices on its Pirelli branded passenger and light truck/SUV offerings by up to 4%. Hankook Tire America Corp. also increased prices Oct. 1, bumping prices by 3% on all of its passenger, performance, light truck/SUV and medium truck tires.

 

Foord And Bozarth To Join Tire Industry Hall Of Fame

Kal Tire founder Tom Foord and former International Tire and Rubber Association executive director Marvin Bozarth were selected for induction into the Tire Industry Hall of Fame. The Hall of Fame induction will take place during the upcoming International Tire Expo in Las Vegas.

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Since founding Kal Tire in 1953, Foord’s innovative nature has helped the Vernon, British Columbia-based business become Canada’s largest independent tire dealer, boasting annual sales of over $280 million. Today, Kal Tire includes 113 owned locations, 50 associate dealers, 15 retread plants, five distribution centers, and associated operations in Chile and Ontario.

Foord was a founder of the Western Canada Tire Dealers Association, and assisted many charitable organizations. Foord also received the Order of British Columbia, the province’s highest civilian honor, and was honored with honorary law degrees from both Royal Roads University and Okanagan University College in British Columbia.

Still an active consultant to the Tire Industry Association, Bozarth embarked on his tire career when he began a seven-year stint as plant manager for Missouri Farmers Association Oil Co.’s retread plant. In 1965, he joined Community Tire Co. in St. Louis as retread division general manager, moving over to Purcell Tire Co. in Potsoi, Mo., as plant manager for five years and then as vice president of manufacturing for another 15 years.

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In 1990, Bozarth was named technical director of the American Retreaders Association, and led the design and construction of the association’s headquarters and training center in Louisville. He became executive director in 1991, served as editor of the Retreading/Repair Journal, led the reorganization of the ARA into the ITRA, and was instrumental in the eventual merger of the ITRA with the Tire Association of North America.

 

Manny, Moe & Jack Looking To Add Branded Tires

Struggling auto parts and tire retailer Pep Boys outlined a new strategic vision for its future, one that includes even greater emphasis on tire sales. Pep Boys President and CFO George Babich presented the new "go-forward" strategy during the recent 2003 Morgan Stanley Convertible Conference.

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As part of its new strategy, Babich said that the company plans to strengthen its service business by introducing branded tires, though he offered no specifics on what brand the retailer would carry. Pep Boys currently offers its own Cornell and Futura private brand lines.

"Ultimately, we are building Pep Boys to become the dominant, one-stop shop retailer for automotive maintenance and accessories," said Babich. In addition, Babich said Pep Boys plans to redesign its retail locations to better capitalize on per-store square footage, and increase cross-promotion of its retail and vehicle service businesses.

 

ACCC Teams Up With NCPRS On Smoke Detector Program

American Car Care Centers (ACCC) and the National Center for Prevention and Research Solutions (NCPRS) have teamed up to help protect the homes and families and ACCC dealers and their employees. Through Operation Fire Safe, ACCC dealers and their employees were able to receive up to three free smoke alarms for their homes.

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Operation Fire Safe is new program funded by a grant from the U.S. Fire Administration, part of the Federal Emergency Management Agency. NCPRS has been operating a drug prevention and education program called Race Against Drugs (RAD) for the past 13 years, and only recently changed its name.

Continuing with its motorsports heritage, Operation Fire Safe will distribute the smoke alarms through racetracks across the country, through motorsports sanctioning bodies like National Hot Rod Association (NHRA) and National Tractor Pullers Association (NTPA), and through corporate partners like Summit Racing Equipment, Ford Racing and ACCC. For more information about NCPRS and its programs please call 866-NCPRS-NOW (866-627-7766) or visit www.ncprs.org.

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Cooper Moves Some Truck Tire Production To China

Looking east for supply help, Cooper Tire & Rubber Co. signed an agreement Oct. 7 with Hangzhou Zhongce Rubber Company Ltd. to supply the Findlay, Ohio-based tiremaker with 250,000 to 300,000 radial medium truck tires annually. The tires will be produced to Cooper’s technical specifications and under the company’s brand names, but no dates were set for implementation.

Cooper said it was transferring tire molds and "other related equipment" from its Albany, Ga., tire plant to Hangzhou Zhongce Rubber Co.’s facility in Hangzhou, China. In turn, Cooper plans to realign the Albany plant to produce additional high performance and light truck/SUV tires, which deliver greater profits.

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"We have been very candid about our plans to seek additional production in Asia to supplement our U.S. capacity," said Dick Stephens, president of Cooper’s tire group. "We have been traditionally known as a low cost producer in the U.S. and we continue to use ‘lean initiatives’ to improve our quality and lower our costs. How much production we secure in Asia depends on the success of our efforts in the U.S. to make tires at the quality our customers demand at a cost which keeps us competitive in the marketplace."

Stephens said the agreement was "a necessary strategy to make our overall product mix as competitive as possible," he said. Cooper’s Albany plant employs some 1,500, and can produce 25,000 tires per day, including 1,200 radial medium truck tires.

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TBC Buys NTB Stores, Grows To 1,144 Retail Locations

In a move that surprised virtually no one in the industry, TBC Corp. agreed to buy the 226-store National Tire & Battery chain from Sears, Roebuck & Co. The deal, estimated at $260 million in cash for facilities and inventory, is expected to be completed by the end of the year and will give TBC a total of 1,144 retail outlets across most of the continental U.S.

TBC has 561 franchised Big O Tire Centers and another 357 Tire Kingdom locations. By adding the NTB locations, TBC also gains ground in a number of new markets, including 36 stores in Texas (Dallas, Houston and Austin), 19 stores in the greater Chicago area, and locations in Boston, Kansas City, Philadelphia and Pittsburgh.

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Sears launched NTB in 1997 by merging its National Tire Warehouse and Tire America operations. By 1998, there were 330 NTB stores and Sears said its goal was to have 700 stores by 2001. Instead, Sears closed over 100 underperforming locations, and decided earlier this year to sell off the troubled chain. When word leaked that it planned to sell NTB, most in the tire industry expected TBC to be the buyer.

TBC plans no immediate changes to the acquired stores, which will be managed by its Tire Kingdom division. NTB generated some $425 million in annual sales last year.

 

OF NOTE

TRIB’s new black and orange "Retread.org" bumper stickers are now available to members and non-members alike at 888-473-8732, or at in[email protected]

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Reports from Asian media indicate that Groupe Michelin’s purchase of a 10% share in Hankook Tire Co. may give Hankook access to Michelin dealers and distributors in North America and Europe, while Michelin gains low cost production at Hankook plants in China, including a reported 10 million BFGoodrich branded tires earmarked for North America.

Midas will close 11 of its 12 distribution centers by the end of this year in order to exit wholesale U.S. distribution business and focus on franchise retail business.

Dana Corp. plans to sell certain production assets of its Heavy Vehicle Technologies and Systems Group to Sypris Solutions Inc., and has entered a long-term supply agreement with Sypris for the related axle components; ArvinMeritor is still attempting to acquire Dana.

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Kumho Tire USA’s parent company in South Korea has changed its name from Kumho Industrial Company to Kumho Tire Co., the result of the company selling a 70% share in the business to the South Korean Military Mutual Aid Association and other investors.

After a year-long courtship, Pirelli Tire North America has named WestWayne Inc. in Atlanta as its advertising agency of record.

American Tire Distributors’s revised Web site – www.americantiredistributors.com ®“ features an upgraded design, expanded functionality and sections tailored specifically for consumers, dealers, media, investors, and current and prospective employees.

Continental AG rejoined DAX, Germany’s blue chip index of that country’s 30 largest companies, after a seven year absence.

Fountain Tire has purchased 150 Mile House’s Big B Tire, located near Williams Lake, B.C.

Goodyear was awarded a $54.5 million Army contract for a combat vehicle track for the Bradley Fighting Vehicle and six other major weapons systems.

Canadian Tire and its "retail associate dealers" reached agreement on a new 10-year contract; the company’s 440 associate dealers are functionally franchisees, and own and operate the retail stores per terms and conditions agreed to under the contract.

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For every minute Julie Foudy, captain of the U.S. Women’s National Soccer Team, played in the 2003 World Cup, Michelin’s Uniroyal unit donated $500 in soccer equipment to youth soccer leagues, and donated $50,000 in equipment for every goal Foudy scored in the tournament.

ASA Tire Systems has added SonicWALL Inc.’s remote Internet security system to its TireMax and TirePro software.

Toyo Tire (U.S.A.) joined the Tire Retread Information Bureau (TRIB). Toyo is the 13th tiremaker to support the organization.

Bridgestone/Firestone North America Tire signed a two-year agreement to be the presenting sponsor of the Music City Bowl; played in Nashville the college football event is now called the Gaylord Hotels Music City Bowl Presented by Bridgestone.

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Cooper Tire signed a five-year deal with Formula Motorsports Inc. to create the Cooper Tire Championship Series, in which the Formula Ford 2000 Zetec open wheel series and the Formula SCCA and SCCA Sports Racer pro series will run on Zeon racing radials.

Tenneco Automotive is introducing a new line of Walker Clean Air Ultra aftermarket catalytic converters, as well as Walker DNX polished performance mufflers and exhaust tips for sport compact cars.

The Firestone tire brand was inducted into the Cruisin’ Hall of Fame at the 14th annual Stater Bros. Route 66 Rendezvous.

A new Web site – http://www.righttorepair.org – was launched to enable tire dealers, repair shops and consumers to quickly and easily send a message to their elected officials in support of the pending Right to Repair legislation.

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More than 100 clean running advanced technology vehicles from most of the world’s top vehicle makers rolled into Sonoma, Calif., for Michelin’s fifth annual Challenge Bibendum environmental vehicle competition, held at Infineon Raceway from Sept. 23 to 25.

Blevins Tire & Recapping in Bristol, Va., hosted dozens of its customers at an open house on Aug. 15 at its new Marangoni retread plant, which started production earlier this year.

Tire manufacturing machinery dealer Pelmar Engineering purchased all of the tire building machines from Continental AG’s closed Semperit plant in Traiskirchen, Austria.

Pete’s Road Service, with nine commercial/retail locations across Southern California, opened a new 64,500-square-foot service center in Corona featuring nine truck bays, four drive-thru bays, four passenger vehicle service bays, warehouse space, and a new retread plant.

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Senate Judiciary Committee backed a bill creating a $153 billion national fund to compensate asbestos victims and eliminate protracted liability lawsuits.

Dunn Tire chairman and CEO Randy Clark was honored as the 2003 Niagara Frontier Executive of the Year by the University of Buffalo School of Management.

Bridgestone/Firestone’s Aiken County, S.C., tire plant was selected by Industry Week as one of the 10 best manufacturing facilities in the U.S.

Smithers Scientific Services is expanding its Akron laboratories to increase polymer processing and testing capabilities, and Tritech Laboratories is transferring all commercial testing activities from its Akron Polymer Laboratories unit, to Smithers’ laboratories.

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Ohio Tire Dealers & Retreaders Association elected D.D. Coley of Consumer Tire Inc. as its president.

Celebrating its 100th anniversary is the Tire and Rim Association, the leading standardizing body for tires, wheels, valves and allied parts.

Pirelli SpA started production at its new $120 million radial passenger and light truck tire plant in Bahia, Brazil, which will primarily source Pirelli Tire North America; the 344,000-square-foot, 360-employee plant is the company’s sixth in Brazil.

U.S. District Court for the Central District of Illinois in Springfield denied a motion to dismiss a three-year-old racketeering lawsuit against the United Steelworkers of America stemming from its labor dispute with Titan International.

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Royal Tire, based in St. Cloud, Minn., and operator of Tire One locations, is using CarParts Technologies’s Tradera Tire Management System and OpenWebs Commerce Server.

SmarTire Systems signed an agreement in principle appointing Beijing Boom Technology Co. as master distributor of SmarTire’s TPMS in China.

SEMA has expanded its tuner shows, adding the International Auto Salon – Atlantic City, May 21-23, 2004.

Bridgestone Corp. said it will invest $76 million over three years to expand production for radial truck and bus tires at three plants in Japan and one in Thailand.

Nihon Keizai Shimbun reports that Toyo and Michelin will jointly develop a new run-flat tire, and will hook up to share marketing and customer service networks; neither Toyo or Michelin officials would comment on the report.

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Toyo Tire (U.S.A.)’s Web site – www.teamtoyo.com ®“ has been given a completely new look with interactive photos and graphics.

 

Arnco – Appointed Carmel Boley to sales assistant.

Big O – Carl Finamore named executive vice president of sales.

Bridgestone/Firestone – Art Campagnoni to director of truck tire sales ®ƒ John Baratta to director of retail consumer tire sales ®ƒ Rudy Beach to director of consumer tire sales for distributor key accounts ®ƒ Brad Booth named regional general manager for key accounts ®ƒ Brian Ebert promoted to regional general manager for commercial tire sales.

Continental Tire North America – Named Andreas Gerstenberger as vice president of sales and marketing for the PLT replacement tire business unit.

Falken Tire – Bruce Ware named director of business development.

Goodyear – Lawrence Mason named president of consumer tires … Jack Winterton appointed vice president of consumer tire replacement sales ®ƒ Stephen McClellan to vice president of commercial business ®ƒ Dave Beasley to vice president of commercial tire marketing ®ƒ Richard Kramer named senior vice president of strategic planning and restructuring.

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Great American Tire – Jim Seidel named national sales manager.

Kumho Tire USA – Dan Davis named manager of public relations.

Michelin – Named Jean-Michel Guillon CEO of MAST ®ƒ Marc Laferriere was named vice president of marketing for MATT ®ƒ Steve Evered to director of federal government affairs.

TBC Corp. – Greg Ortega to director of corporate product marketing.

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