Starco takes the ‘next logical step’
Two years ago, at Reifen 2010, Starco marketing manager Brian Lorentzen told Tyres & Accessories off the record that the company was in the process of developing plans involving the agricultural sector. At this year’s show the news was finally made public as Starco announced its entry into the tractor radial tyre market. The Danish company describes this agricultural debut, which centres on a new distribution agreement with the tyre manufacturer ATG (Alliance Tire Group), as “a move that breaks with the past and indicates the shape of things to come.” Under the agreement, Starco will now distribute ATG’s Galaxy tractor tyre range in Denmark, Sweden, Poland, Germany and the Benelux countries.
“As a manufacturer and supplier of special wheels, Starco has already made the commitment to the agricultural market with flotation wheels, implement wheel, dual wheel systems from Schaad, wheels and tyres for industrial machinery and trailers,” commented Starco Group marketing manager Brian Lorentzen. “As a serious supplier to the agricultural market, not least from our steel wheel factory in Croatia and special wheel factory in Switzerland, the addition of tractor radial tyres to our product portfolio is the next logical step.”
Lorenzten shares that although the deal with ATG involves both Galaxy agricultural and non-agricultural tyres, Starco is initially focusing on tractor tyres as this is an all-new area for Starco. “We are promoting 85 profile tractor tyres, and in the last quarter we will have the 70 profile,” he elaborates. “With these two we are covering the main, high-volume segment of the market. When this is established we will focus on the non-agri segment; all are already on sale, admittedly.” The marketing manager adds that the agreement covers aftermarket customers the Danish, Swedish, Polish, German and Benelux markets.
ATG ‘fits the bill perfectly’
The partnership with ATG is described as being “perfect timing” for Starco. Bolstered by a capital injection from an investment fund, ATG recently established a US$100 million tyre factory in India, which amongst other products manufactures the Galaxy agricultural tyre range, a line-up said to match around 80 per cent of the market’s requirements for radial tyres for both two and four-wheel drive tractors – at, the Danish company points out, very competitive prices. “It was essential for Starco to enter into an agreement with a manufacturer who has the design and production capacity to deliver a radial tyre product that is well-engineered and already proven in the field”, Lorentzen added. “With a track-record of launching a new tyre every third day, ATG fits that bill perfectly.”
Starco’s news about entering the agricultural market follows other recent major announcements, including deals covering the Schaad range and the completion of the company’s new solid tyre factory in Sri Lanka. “Schaad has already been converted to a Starco entity, although the Schaad name will remain in established markets,” Lorenzten comments. “With our acquisition of Schaad, we now have suitable tyres for our wheels – previously we could only sell the Schaad wheel kit. This completes our dual-wheel service.” As for the new factory, the marketing manager says “we are happy with aftermarket supply. Products from our plant in Sri Lanka are now on sale in Europe and have performed excellently in tests. The factory has been set up to enable a quick and easy ramp up of capacity as and when it is needed.”
Given the rate of development at Starco over the past few years, it would most likely come as no surprise to hear that the Danish firm now has its eyes set on further goals. “Our focus is on our strategy to be the global leader for specialty wheels,” Lorentzen relates. “That means going global. We are looking at new markets – we have good news coming.” The Group marketing manager did not elaborate on what form this news will take, but he did comment that Starco is now growing in the Russian and Ukrainian markets. “Agriculture is developing there and industrial business will also develop there. At Starco we say that one single farmer activates the employment of 350 people downstream, in transport, logistics and other sectors. Therefore a good farming area eventually creates jobs.”
Brian Lorentzen also shared that, as part of its focus on building up its agricultural business, Starco is restructuring its West Group to define its respective focuses on the aftermarket and original equipment segments. What this means in day to day terms is that specific staff will focus on each of these areas. Staff members are also receiving hands-on training involving agricultural radials.
Reifen an unparalleled opportunity
Starco has been in business for half a century now – a period during which, as Lorentzen says, the company has transformed from a family business to a business family – and in this time it has attended a number of Reifen shows. The marketing manager says Starco needs to be at the trade exhibition, as what it offers complements what visitors need. But he shares that at this year’s show he witnessed a look of surprise on some peoples’ faces when viewing the Starco stand: “They’d comment, ‘where are your small tyres? I didn’t know you did wheels!’ Starco always showed its small tyres at Reifen. This time they were not on the stand. Although they’re still an important part of our range, we wanted to show our focus on large tyres, industrial tyres, agri tyres and wheels. People commented on this.”
All in all, Reifen 2012 was a very successful show for Starco, Lorentzen reports. “Were thrilled to see on the first day that all the purchasing managers and top guys from all the big companies and chains were here. The opportunity Reifen offers is unparalleled. We are only one of a few companies specialising in off-road tyres, which means we are busier than ever. We will definitely be here with a large presence next time.”
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