Morry Taylor says he’s not going to take another shot at winning the White House, but he’s coy about specific plans post retirement. “I’m going to have fun,” he says, “I’ll put some money up and have a good blast.”

The 69-year-old chairman and CEO of Titan International Inc. is coy about very few things. No self-styled comic book hero, Taylor is well known as a hard worker and a ‘straight shooter’ who says exactly what he means, whether you want to hear it or not – or believe his statements.

Say what you will about Morry and his views and the things he’s said over the years, he also deserves a great deal of credit for building Titan, taking a rag-tag collection of teetering businesses and reforming them into a $2.16 billion global OTR and ag tire and wheel powerhouse with interests on nearly every continent.

Fighting off a cold, Taylor sat for an interview with Tire Review editor Jim Smith in late May. An edited version of this interview appears in the July 2014 issue of Tire Review.

Talk a little bit about the current status of Titan in terms of its financial outlook?  What’s the revenue and profit goals for the next for 2014 and 2015?

“Well, I think our revenue outlook is in the $2.3 billion range, $2.3 to $2.4 billion. And the reason being is mining is still in the tank. You have a little bit of a bright spot in construction, but then you also have the ag business, which is being hurt mainly because a lot of the farmers, the big operators, they don’t have that $500,000 instant write-off. That was like free money, you know? And you generally don’t buy a brand-new tractor, and you’re only going to get so many hours on the doggone thing, and then turn it in for the next year, unless you’ve got all that write-off.

Almost every equipment dealer in North America is sitting on too much used equipment, and I think that’s because they’ve got it priced too high, and they used to be able to move it offshore. But I think the OEs that are trying to expand said hey, don’t be shipping this stuff over. So, they’re going to have to have a little shakeout there. That’s the big profit margin, the big stuff. The under 100 horsepower equipment is going real good, but there’s not a lot of margin in that stuff.

So, that’s our goals for revenue. Our profit goals? We haven’t issued those yet. We want to make money. There’s no question, 2015 is going to be a hell of a lot better than 2014. So, that’s what we see there.

The pipeline and new technologies in the giant OTR tires, which is actually, I believe, what you call the super giants, the 57-in. and 63-in., there’s so much added capacity worldwide, mainly brought on by Michelin and Bridgestone. And even Goodyear brought some on. They’ve got three times the capacity of the whole market. So that pricing is just headed downward, and it’s going to keep going. We’re looking at changing everything and doing it in a specialized market on that big stuff. What we’re trying to do is to bring our LSW (low sidewall) technology into it. And so, with the current 63-in. tire – those are all haul truck tires – we’re looking at making that tire with a 73.5-in. wheel diameter but the same height and outside diameter. Those 10 inches don’t sound much, but it makes the whole tire operate differently. And we’re looking at doing that for loaders, all in a radial size.

What’s the timetable for coming out with those?

We hope to have our first one out for trials this coming fourth quarter, but we’re looking at others. We’re going to make a 57-in. also in a 73.5-in. I think those will outperform the bouncing balls that we’ve got out there, at least what we see in the smaller sizes. In the midrange, from the 51-in. down through the 35-in., we are already running samples of those as LSWs out in the field. The 2400-35 would be like a 2400-42.5, and we’ll see how that goes. For loaders, we’re taking the 51-in., which would be the 50×51, which would go on a Cat 793, and we’re going to make that a 50×59.5. Then you drop back down to the next size. You’ve got a Cat 992, which takes the 45-in., and we’re going to turn that one into a 56.5-in.. We’re going all the way down because what we have found, contrary to what everybody thinks, you would think the LSW would be a stiffer ride tire. But with LSW you get less bounce, and it just improves everything on the loader. It’s no different than low profile performance tires on your car.

The ag tire versions of the LSW, is that what you have seen there?

Same thing, it’s the same thing. We’re going to do it in construction and ag, too, because we make the wheels and the tires. We can move pretty fast on it. We can take a John Deere tractor, a 9560, take the 800-38s off, put on 800-46s, and keep right up in speed, everything, with a quad track. We did the whole demonstration with Sloan and Case. You save so much money in fuel consumption, let alone what you’re doing in reference to the initial cost and while you’re in operation. As one farmer told me, tracks are for bulldozers and tires are for tractors, and it really does come out that way. That’s really the market that we’re pushing real strong right now, and it goes all the way down to the skid-steer. Actually, smaller than the skid-steer. What’s happened is when you get to the farmer, he’ll step up and pay for it, not to have trouble. Not only does it make the equipment perform better, it’s so much safer to handle when you’re moving it.

You kind of touched on these a little bit when you were talking about your sales goals, but can you give a brief overview of where you see the mining market in general right now? What are the pressures that you’re seeing, the construction market and also on the ag market?

Well, let’s start with the mining market. I think the mining got hooked up in all this speculation. They started believing a lot of their own stuff. So, they created their own shortage of tires. You know, in mining they’ve got to run around and look for new sites.  And so, they were getting better at the sites they were already at, and they were digging and all mines were running 24/7. Then that translated to equipment. Orders were out for five years. Everybody was going hog wild. Finally, Bridgestone and Michelin, they bit the bullet and threw out a lot of money (for added capacity), and it’s just going to go to hell, in my opinion. That’s what I see. I don’t expect mining to start to come back to sort of resemblance for at least three years plus. That’s a long time in this business.

Since with our capacity we’re the smallest dog out there with the big mines, so I figure we’re smarter to go into specialized aspects, underground and into the loaders.  Everybody concentrates on haul trucks because of the tremendous volume. It’s better to let them chase those dogs; I’m going to go over here and play in a different sand box. I think that’s the way we can still keep flicking around and make some changes, if we can make some money on it. But we’re not going to go after the big hog over there. No way. It doesn’t make sense to me.

The construction side is where we play a much bigger role. If you go all the way down through the backhoes, the skid-steers and the small loaders – we have capacity, not only in North America, but in Russia and in South America. We’re coming up with new stuff down there all the time. So, that looks pretty good for us. What we see for that market is it has never changed in my 40-some years in this field. It goes up, it comes down, it goes up, it comes down. Very cyclic up and down. Ag is a little different. In the ag market, there’s no question in my mind that it’s going to stay up overall. It’s down on the large tire side, but it’s going to stay a very good market for a long period of time, mainly because of the food requirements. We just happen to be in a beautiful breadbasket area. But with tires and what you can do out in the field, it’s been neglected for years. We’re setting up these supergiant farmers, and we’ve turned around and proved to them what we can do with new tires and wheels. When you go to the OEs, in all fairness, the OEM is interested in the cheapest thing you’ve got. Okay? Instead of coming to us and asking if we can make something that will make their equipment perform better. Now, in order to do that, you have to talk to engineers and to marketing. It’s not like when I started. The OEs today, you go to purchasing, the supply manager or whatever the hell they want to call it, and their bonuses are based a little bit like the Veterans Administration, you know? They get a pile of money because they don’t take care of the patient, right? Purchasing gets a pile of money if they just keep reducing the price. So, they’re not interested in the other stuff. That’s why you bypass the OEs and you go to the aftermarket, and then you start there. Then what happens is the dealers, everybody else starts force-feeding back to the OEs, and then the OEs realize that you’re putting this nice tire on their vehicles and it makes them perform better. And they realize that there’s something wrong with this supply chain that we’re not in this chain.  Then they come to you, ‘Hey, we like that, so we’ll do this’ and blah, blah, blah. … I mean, that’s pretty much what happens, and I expect that to continue. But that’s been my whole big thing, to change wheels and tires in this business so that the owner gets what he’s looking for. I think I’ll succeed with that.

Let’s talk about the stock position taken by MHR Fund Management and its CEO Dr. Mark Rachesky.

Well, he owns about 13% today, and the doc can buy whatever the hell he wants. I don’t care. That is the normal way he does business. I don’t think he’s bought over 35% in any company. He’s not like a lot of these other guys. He takes what people call ‘large position,’ and then he tries to help the management, anything on the financial side, that he can. That’s his real forte. And I like him. He’s on the board now, and he’s going to fit real good. All my board members met him, and they all like him. I told him, ‘We’ve got to call you Baby Doc, because he’s the youngest guy on the board at 54. I’m going to go raise hell with all these people who think that public companies should have nobody that’s over 70 sit on their board. They should make that rule for Congress, with the dummies they’ve got.

Last November, you mentioned four acquisitions that were being considered. Any more information on any of those? Any light you can shed on…

No. Two of them would be in our…right now what we’re looking at, we’re looking at a couple on the tire side and a couple on the wheel side. And that kind of finishes us up. So, if I get those done, if they stay the way they are, that would take us up to about $3 billion, and that would really put us to where we would move up and move down in reference to how the market grows.

What do you mean by ‘move up and move down as the market goes’?

Well, as the market goes up, you know. If mining takes off, you’re automatically going to go up in the Bryan (Ohio) plant and at a few of the other places. If it turns around in construction, it’s the same thing. Ag goes down, you’ll go down a little faster because we’re more ag-weighted than we are construction or mining.

Let’s talk about the current status of the U.S. plants. You’re making some reductions. Have those been determined, and how is that going to impact your facilities?

There’s no question when you run these big factories, in the tire plants, you have to run tire factories 24 hours a day, seven days a week to make it efficient. You’ve got to have your boilers up, you’ve got to have your curing, all the other things. So, what you do is you run them and then you shut them down for a couple weeks. That’s what we did in Bryan. That’s because they make the mining tires. So, we’re trying to run like hell for a period of time, and that’s how you stay efficient. It’s tough on your workforce, but you’re not in this for a charitable situation. You’re supposed to be in it to make money. So, that’s how we’re doing it there. The other factories, I think we’ve gotten a little bit on the fat side. So, we’re making surgical cuts, not only in the hourly ranks but also in the salary ranks. You’ve got to get yourself operating in a lean situation. It’s the same thing as in Europe, you know? This is not just a U.S. situation. Our European plants have got more bodies. They produce less per man-hour than we do over here. So, we’re attacking that problem. You have to always keep your eye on it, and we’re doing that.  There is no specific number, we just go through and review, but I would think that we’re going to cut pretty close to a good 10%.

In terms of your capex, what are you planning there?

Well, we’re not expanding capacity, but you’ve got to spend the money to make sure you’re maintaining your facilities. You’ve still got molds, you’ve still got dies to build, everything else. I think our capex worldwide this year is probably going to be in around $70 million. That has nothing to do with acquisitions or anything. That’s just what the level is right now.

Whatever became of the tire plant you built in Brownsville, Texas? Is that still there?

Oh, yeah, the Brownsville plant…we have leased out 300,000 square feet of it to an automotive-type company that, I think, makes injection-molded fenders for big trucks. And they have an option to buy that section. We have other people looking now at the rest of the facility. In fact, there is an offer, I believe, to buy the whole thing. So, when all’s said and done, we should make a little money on that. That’s what happens when you’re stubborn.

What’s Titan’s current relationship with the USW?

That’s a good question. Well, I can call Leo Gerard, and I think he’ll take my call. If he calls me, I’ll take his call. I haven’t met the new guy. Jim Robinson was the District 7 director. They elected a new guy (Mike Millsap), and I really don’t know him. But hey, they get their checks. They don’t want to bother me. About a year before the current contracts are up, I’ll probably get a call from them. We’re compliant, and we try to stay out of union problems.

Talk a little bit about your joint venture in Russia, and particularly how that’s progressing. What concerns are there with regard to the current state of affairs between Russia and the U.S.?

Well, we’re doing what we expected from day one. We didn’t expect the Ukrainian issue. I don’t think it has any bearing on us…I don’t think it’s going to have any negative impact on us over time, but that’s, that’s just my view.

You touched on this a little bit, but what’s the status of the integration with the Titan Europe operations?

We’re moving ahead. That’s just a slow frigging process. Every country has their own set of rules and regs for reducing people, consolidating things, and that’s what we’re trying to do. Over here it’ll take a month. Once you decide to go ahead, you do it and you start moving. Over there, once you decide then you have to go into negotiation, not only with the workforce but also with the government.

Are you trying to reduce the workforce there and consolidate operations?

Yeah. Oh, yeah. Consolidate…that’s what you have to do. It just takes a long time. But we don’t take as long as Mother Goodyear, okay?

Speaking of Goodyear…Anything new with your relationship with the country of France or with Goodyear’s plant there?

The poor French. I think I summed up the situation over there pretty good. I mean, they keep moving the chairs. It’s like any place you go. If you can deal with the workforce direct, explain everything and keep everybody else the hell out of the way, you can win most of the battles. The problem with Europe, the problem with so many countries, is that you can’t deal directly with the workers because you’ve got to deal with the government first or in conjunction with them, and that just creates…nothing gets done.  And it’s the same the way we’re headed, which is stupid. But we can’t do anything. There are still some lawsuits out. Goodyear’s trying to get those settled. We’re just sitting back. There ain’t nothing we can do.

Is there interest in that plant?

Oh, yeah, there’s interest. Goodyear knows that, yeah. I’ve got no problem. I think we’d like to finish up what we started eight or nine years ago.

But you’re content to sit back and wait it out.

Oh, yeah. I think that’s the only smart thing to do. Fools rush in. I’ve been a fool a few times in my life, but I’m trying to get a little wiser as I get older.

Let’s talk about the next phases with regard to Titan International and Titan Tire.  Has your succession line been settled, and is it in place?

Well, I think we’ve got new guys running everything as we speak. You always have to look at the situation, and see how they do. On the top end that’s the board’s call, but I think that we’ve got a good team. As a group president, Paul Reitz is a young guy, smart as a whip. He’s got the competitive nature. But you know, you got the different fields you’ve got to learn, and you’ve got to learn what’s going on. Otherwise, you get fooled. Accountants will always give you the score – that’s where he was – but they don’t know why the score came out that way. Now he’s in a position where he has to try to figure that out. So, that’ll come in the next year or so. He’s either going to make it or he’s not going to make it. You’ve got the guys at the tire group and at the wheel group…they’ve got their hands full too. Now that things are slowing up a little bit, you get to stand back and see how they react. I think that’s all pretty good. I think the company, right at this stage, has probably got a better team sitting there then we had two years ago.

Are you satisfied with how the management is shaping up?

Yes and no. You know, when I came up, we started with a closed factory. We took a gamble and we risked a lot. I lived the business. Other people, some of the people coming up today, they’re a whole different breed, and they don’t have the same passion. But you’ve got to be smart enough and don’t get yourself covered with your passion.

Talk about you and about the influence of your parents and other people on your life and career.

Well, you know, you’ve got to always thank your parents and your heritage. Harvard hasn’t ever created a brain cell. So, you’ve got a good mixture of your parents and other people in your lineage. My parents, blue-collar parents…my mother, her father was a fireman from Michigan and big-time Democrat, always a Democrat. My dad was the youngest in his family; my mother was the oldest. My dad never, never, ever remembered his father. His father took off. My grandmother couldn’t take care of him.  So, he lived on a farm, boarded out. He worked for his room and board. The thing I learned from them, as I’m the oldest, is that my dad was very instrumental. He said that I had to learn a trade, that I should either be a toolmaker or welder. That’s what I am by trade and schooling – an engineer. My dad took his first vacation 13 years after he got married, so we learned the power of work. You don’t have to be the smartest dog, but if you outwork the other dogs, you might get more bones. And I think that I’ve outworked most people that I compete with. I think that’s a big thing.

Was there anybody else in your life who was a mentor, a contributor or influence?

Oh, yeah. I worked for Joe Tannenbaum for 20 years. Orthodox Jewish gentleman, God rest his soul. A friend told me that the only way a Gentile could survive with him is if they were the golden goose. As long as he thought you would lay a golden egg, he’d keep you around. Otherwise, he’d have you for dinner. And old Tannenbaum, he was tough. I learned a lot from him on the business side. He only went to the eighth grade. There have been many, you know, through the course of life, how many times people say things, or you watch them and you kind of pick up on that. It helps you. That’s what happens as you get older and older, you just keep learning.

Have you figured out when you plan to step aside and enjoy retirement?

I hope by the end of 2015, that I don’t have to be in the act of day-to-day management of Titan. I enjoy seeing the customers and everything. I enjoy that part of the business, and that’s what I like to do. I’m pretty knowledgeable about the product that we make. So from that standpoint, I like to keep involved that way, and on the board, if so be it.  That can get to be a routine, too. Of all the guys you talk to, I don’t think you’ve talked to too many of them that have been around as long. Almost now, what, 22 years I’ve been the main dog of a public company. That’s quite a few.

It doesn’t happen very often anymore.

No. I figure I’ve seen a lot, up and down, every which way, good, bad and indifferent. And we’ve pretty well held our ground. We get knocked down, but we get up. For an outfit that just took everybody else’s crap that they couldn’t make money with, we’ve done pretty good.

Do you have any particular plans post your Titan career?

Oh, there’s a lot of things I’d like to do. I’ve contacted some of my old wild crew, and I’m probably going to get more vocal into that. I’m not planning on running for anything, but I’m planning on…I see enough talking heads. You get what you vote for. I don’t care if you’re a Democrat or Republican. The problem is the federal government is just totally out of control. You’ve got city governments that are out of control. And the bureaucracy starts to just feed on itself. No matter how stupid something may be, it keeps marching that way. And you know, sometimes someone’s got to step up. They’ve got to understand how you straighten it up. It makes no difference whether it’s a business or whether it’s a government. So, I’m going to have fun. I’ll put some money up and have a good blast. You’ll have a few chuckles. You’ll agree with some of my ideas. Some of them you won’t. But that’s what I’m planning to do.

Any regrets over the years?

You can’t go through life and think about the regrets. You’ve got to just keep moving. I lost a brother. I lost a good engineer. There’s a lot of things. You can dwell on them, but the world’s still spinning, and it just moves on. So, that’s the way I look at it. I don’t think about it.

If you could do one thing over, what would it be?

Well, if I had to do one thing over, I’d tell my brother to stay home with the engineer. And he wouldn’t be dead. That’s real simple for me. But you can’t do that. There’s no sense living in fantasy. Correct?

One last question, if you were talking to an up-and-comer – either freshly minted college grad or somebody new to the business – what advice would you offer them?

I would tell, and I do tell them, don’t get yourself caught up in a box. Ask questions, no matter how stupid you might think they are. They’re not stupid to you, so ask. A lot of people have a tendency to think about a question, then they start ask but then they think it would be stupid, so they don’t ask and they never find out. You have to ask to be able to learn. And always turn around and offer to help. If you walk through a factory and some guy is out there pushing a cart, he’s really pushing hard or something, help them. If you walking around, there’s a bolt or a nut on the floor, pick it up. You never know how many eyes are watching you, and if people see you do those things, then they have greater respect for you. Don’t run through life wanting everyone to love you. Go for respect. You get respect because you earn it in some way. And that’s my advice.