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Ripple Effect: TIA’s Annual OTR Tire Conference Explores the Aftershocks of Demand Quake

TIA’s Annual OTR Tire Conference Explores the Aftershocks of Demand Quake

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A 50th anniversary is always cause for celebration and serves as a natural point from which to consider the past and plan for the future.

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TIA’s 50th annual OTR Tire Conference, held Feb. 24-26 in Tucson, Ariz., certainly provided a wide-ranging retrospective of the multi-faceted OTR tire business over its three half-day sessions.

Larry Noah, of Raben Tire Inc. and TIA OTR Group chairman, noted that the conference was started by a handful of OTR tire dealers interested in sharing information about the market and has grown into a large event “where we can see old friends and share our common experiences.”

Noah reminded dealer attendees of the unique educational opportunities the event offers. With more than 300 attendees every year, “chances are there is someone in this room who has faced the same problems you have,” he said.

In providing his annual recap of OTR market shipments, Jack Fenner, Continental Tire North America’s director of commercial tire dealer sales, illustrated how the current OTR tire capacity squeeze slammed the industry. In 2002, he pointed out, “we had tires coming out of our ears.”

Buoyed by the Iraq war and heavy demand from China and Russia, all segments of the market – OE and replacement, bias and radial, civilian and defense – came to life in the second half of 2003, a precursor to today’s troubles. After four straight negative years, the first half of 2003 showed little hope, finishing down 3.4% vs. the same period of 2002.

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In the second half of 2003, Fenner noted, OTR tire shipments shot through the roof, climbing 12.4%. And 2004 stayed strong, closing up 14.4%. Replacement bias tire shipments last year increased 13.3% in 2004 vs. 2003, and radial shipments grew 15.3%. Right now, Fenner said, “there is basically no new capacity.”

Defense shipments, Fenner showed, totaled 24,632 units in 2002, then jumped to 68,942 tires in 2003 before hitting 75,241 last year.

Goodyear Tire & Rubber Co.’s Andrea Berryman, OTR tire marketing manager, and Tim Good, manager of global customer accounts, discussed the evolution of OTR tire customers, and showed how little they really have changed over the last five decades.

One main driver of the evolution has been the emergence of new markets, such as China, India and Russia, which has, in turn, placed tremendous pressure on existing global capacity, Berryman said. Other recent drivers include continuing consolidation of dealers and end users. Large end users are demanding national, even global, supply agreements from tiremakers but still want service delivered by their local dealers.

To best combat the current supply situation, Good suggested dealers need to be mentors and manage the process for end users and not simply be consultants. This means analyzing customer tire useage and making tough recommendations, where needed, to employ retreads or used tires.

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Kevin Rohlwing, TIA senior vice president of technical and education services, updated attendees on the status of the asssociation’s planned OTR tire technician training and certification program. The effort will include self-study and certified instructor options, and he stressed that those participating in the planned program will have to demonstrate competency.

Rohlwing walked conference attendees through a preliminary outline for the program. The 13-module program will cover every aspect of OTR tire service, from demounting/mounting and the use of service trucks to tire repair and proper tire/wheel installation.

Representatives of tiremakers, service truck manufacturers and tire repair suppliers provided interesting retrospectives on their individual markets, giving veteran attendees an opportunity to share their recollections of the past.

On the conference’s final day, Becky MacDicken, TIA’s director of government affairs, updated attendees on the status of key legislative and regulatory efforts that impact the tire industry.

Harvey Brodsky, managing director of the Tire Retread Information Bureau, and Marvin Bozarth, TIA senior technical consultant, discussed the evolution of OTR tire retreading.

The 2006 Tire Industry Association OTR Tire Conference will be held Feb. 23-26 at the Omni Orlando Resort in Orlando, Fla.

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