Progress may take time but, in business at least, the trick is to make sure customers notice that progress.

Dealers attending the recent Continental Gold Select dealer meeting in San Antonio got an eyeful – and seatful – of progress, and a good bit of it revolving around the once-moribund General brand.

Over the last decade, Continental Tire North America has tried to revise, revitalize, reinvigorate and even revive its General tire brand. With a sharp new logo and new product portfolio – including the Altimax powerline – CTNA may have finally done it.

Attended by some 200 dealers, the two-day event in Texas included a half-day dealer meeting and a day out at CTNA’s 5,000-acre test facility in Uvalde, where they tried out the new Altimax line, the new ContiSportContact3 and other CTNA tires on seven test stations.

CTNA CEO Matthias Schoenberg kicked things off with an overview of CTNA’s progress, including an update on its new plant in Camacari, Brazil, and upgrades to its Mt. Vernon, Ill., plant. The Illinois facility is receiving a nearly $100 million infusion, including new production equipment and a 215,000-square foot warehouse expansion.

The new plant in Brazil, which opened last year, will eventually produce some six million passenger and light truck/SUV tires and another 700,000 medium truck tires, Schoenberg said.

CTNA’s chief priority, he said, is to ensure cost competitiveness in North America, to further establish Continental as a premium brand, continue the revitalization of the General brand, and to grow its North and South American replacement markets.

Andreas Gerstenberger, executive vice president of sales and marketing for CTNA’s consumer tire group, provided a look at how CTNA sees the current and near-term North American market.

Gerstenberger said CTNA is shifting its OE business to more premium fitments to improve profitability. “We still want to remain a strong OE player and do a better job of leveraging that for the replacement market, but we do not want to diminish brand value or strain production capacity with low-profit/low-potential OE fitments,” he told dealers.
While the replacement business “was profitable” for CTNA last year, Gerstenberger said the company wants to continue building momentum there, especially with independent dealers. Most of the initiatives he outlined, in fact, keyed on dealers.

From a sales and marketing perspective, Gerstenberger said the focus will be on retail distribution, enhancing CTNA’s product portfolio to achieve 80% overall market coverage, to better leverage CTNA’s OE presence, increase winter tire business in North America, increase marketing and sales support, create greater value for dealers, and continue to enhance the Gold Dealer program.

Carl Casalbore, director of dealer sales, discussed pricing issues, again from the dealer perspective. CTNA had been unstable with its pricing policies, he noted, and it had to stop. “In the last 12 to 18 months, we have focused on stabilizing pricing and bringing consistency to what we were doing. We want the brands to do the work; we do not want to discount the brands,” he said.

Casalbore said the company has reduced the number of pricing programs from the past, and while there will still be occasional specials, they will be there to create customer demand, not unload warehouses. “Our brands have specific slots on the product screen, and we will not bring the Conti brand down, and we will not push the General brand down,” he said.

Marketing director Travis Roffler, who joined CTNA just days before the 2006 Gold Dealer meeting, gave dealers a look at the company’s advertising and promotion plans and unveiled the new General logo. “We want to turn this brand upside down,” he said, displaying the new logo.

Roffler outlined CTNA’s brand advertising efforts for the year, including its “Curves” campaign for the Continental brand that will appear in top-end enthusiast publications, with dealer support ads running in tire trade publications.

The General brand will receive the most attention, with a major consumer and dealer promotional effort. Brand manager Paul Tecci outlined the new “Taking to the Max” program, which includes a music tour, free music CDs for consumers and a consumer sweepstakes and dealer contest with top prizes that include 2007 Ford Mustangs and specially designed Gibson guitars.

CTNA’s new Real Performance Motivation program will reward dealers for selling certain CTNA tires. Dealers earn points for purchases, which they can redeem for such merchandise as a boat, motor and trailer set-up, digital camcorder, big-screen TV, Callaway woods and more.

Finally, Jeremy Lewin, product planning and brand development manager, outlined CTNA’s new-products plans for the year. “2007 is the “first of three crucial years in renovation of CTNA’s product portfolio,” he said, unveiling some 200 new articles that will be added to lines, such as the ContiProContact, the new ContiSportContact3, the General Exclaim UHP, General Grabber UHP, and the flagship Altimax powerline of the HP, RT and Arctic.