Continued growth for Goodyear Dunlop’s Wittlich retreading operation

Manufacturers that aim to offer a comprehensive and competitive commercial vehicle fleet portfolio can’t get by without retreading (typically mould cure retreading performed in large, centralised facilities), nor can they reduce fleet transport costs and meet customer expectations without partnering with the tyre trade and drawing upon the extensive range of services these specialists offer. In the five years since opening a truck tyre retreading facility alongside its new truck tyre plant in Wittlich, Germany, Goodyear Dunlop has made greater inroads into the local fleet business market. Speaking with Tyres & Accessories, Goodyear Dunlop’s director commercial DACH (Germany, Austria and Switzerland), Dieter Schölling, spoke of this push and other developments, including the market upheaval brought about by growing imports of new, low-cost tyres from the Far East.

Speculation has abounded ever since Goodyear Dunlop announced in late June an intention to cease retreading at its Wolverhampton site by 2017 and, within the same timeframe, relocate the production of new passenger car tyres still remaining at its Wittlich site. Many observers assume that a large portion of the Wolverhampton retreading will be relocated to Wittlich. Once the Wolverhampton facility closes, Wittlich will be one of only two retreading plants the US tyre maker operates in the EMEA region (the other is in Riom, France), however the paucity of information coming from Goodyear Dunlop in the UK, Germany and its European headquarters in Brussels leaves us with little more than speculation and conjecture on how the closure of one plant may influence production at another. Schölling says it’s simply too soon to offer concrete information about changes that may occur, even if the company wanted to.

What we do know is that the retreading facility in Wittlich has continued to develop since entering operation in 2010 and that Goodyear Dunlop invested around 20 million euros in the Wittlich site between 2012 and 2014. In addition to expanding production capacity from 2011 levels of around 100,000 retreads per annum to 150,000 the following year, investments were made in energy efficiency and workplace safety during the three aforementioned years. Production has risen virtually parallel to expansion work at the plant. After producing 52,000 retreads in 2011, the 67 employees turned out 102,000 retreads by 2014; this number should reach 110,000 during the course of this year, an amount equalling a capacity utilisation of around 75 per cent.

Nobody is prepared to comment on whether a comparatively significant development such as this in the new German retreading facility had an impact on the 90 year old production site in Wolverhampton, however the connection seems obvious. Efforts at Goodyear Dunlop to lift market acceptance and presence in and around the DACH area in recent years have been successful, and the company has staked its claim in the continental European fleet sector with an extensive, all-round programme that includes new tyres, retreads and numerous associated services.

Performing its own mould cure retreading at Wittlich and at the other two European sites has been a growing priority for Goodyear Dunlop over a number of years, and the tyres retreaded in the three plants have been increasingly integrated into the company’s new tyre portfolio, a development reflecting the ‘Multiple Life’ concept. Goodyear Dunlop mould cure retreading should deliver a product that “corresponds with a new premium tyre in performance, appearance and longevity,” says the tyre maker, adding that “the only point of difference should be the markedly lower cost.” Since last autumn the flagship of the company’s retreading programme has been the premium retreading carried out using the latest generation of Goodyear and Dunlop casings; these retreads are marketed under the “TreadMax Goodyear” and “TreadMax Dunlop” names (the Dunlop product was previously known as MultiTread) and feature the same tread patterns, compounds and technologies as their new tyre counterparts. The manufacturer also offers mould cure retreads under the “NextTread” name. These are retreaded upon casings from prior-generation Goodyear and Dunlop tyres and use the previous tyre series’ tread patterns. NextTread tyres are also retreaded upon Fulda and Sava truck tyre casings. Hardly any ‘foreign’ casings – those produced by Goodyear Dunlop’s competitors – are utilised for retreading in Wittlich.
In addition, the company maintains a network of authorised Goodyear Dunlop-certified pre-cure retreading partners. They are supplied with treads from the UniCircle, UniWing and UniTac ranges, but although Dieter Schölling refers to these businesses as “strategic partners” to the tyre maker, the Goodyear Authorized Retreader (GAR) network is not the company’s main focus. Rather, it represents “an option” that Goodyear offers its (new) tyre partners.
Offering a more price-driven, budget mould cure retreading doesn’t really fit Goodyear Dunlop’s concept, notes Schölling. The company recognises that a certain market demand exists for such products, however it also sees that one or another competitor is already pursuing this market. Whether Goodyear Dunlop will or even wants to go this way in future is not currently under discussion, and when taking the perceived volume of demand for such products into account the director commercial DACH sees no rush to make such a decision.

Goodyear Dunlop’s European headquarters in Brussels and its German head office in Hanau have followed recent developments within the European commercial vehicle tyre market very closely. While the overall market in Germany (other markets developed in more or less the same way) stagnated or slightly contracted in the first six months of 2015, and the retreading market as a whole and especially the pre-cure market declined by a double-digit figure, imports of new tyres from the Far East continued to flood the market. Supplies of imported tyres have risen a great deal in recent times, both in Germany and throughout the entire EU. Last year 435,000 truck tyres were shipped from China to Germany (34 per cent more than in 2013), while the entire EU-27 area received some 3.46 million (up 50 per cent; WdK figures, based upon Eurostat information) – but Schölling says this has only “marginally” impacted upon the Goodyear and Dunlop brand premium mould cure retreading business. “That is a different segment,” the director commercial DACH comments.

Products and services

Goodyear Dunlop has offered its German customers a Wittlich-based ‘Customer Own Casing’ retreading service since autumn 2013, and at the start of this year extended this offer to the other DACH markets, with COC beginning in Austria in May and two months later in Switzerland. “Customers can appraise the quality of their casings. This knowledge influences their tyre investments,” comments Dieter Schölling. In other words, customers who know they can receive their own well-maintained casing back are more prepared to pay good money for a high-end new tyre. “The market demands retreading upon customer-owned casings,” shares the DACH director commercial. The COC option is already “very well established” in Germany; every third retread leaves the Wittlich plant on a customer-owned casing. Customers receive their retread within six weeks. The percentage of COC tyres will continue to rise in Germany, and the manufacturer anticipates the Austrian and Swiss markets will follow this pattern following the gradual introduction of COC there.

It wasn’t necessary to introduce COC gradually because of the investment costs involved, Schölling adds. The costs associated when retreading with customer own casings are marginal once the system has been set up, but a shift from dealer-supplied casings to COC involves jumping over a number of procedural hurdles. Production in Wittlich must, for example, be guaranteed through the use of barcodes so that the right casing is returned to each customer. “It’s no more costly than before once the system is already set up, but there are also processes to introduce.”

A further service element crucial for successful retreading is collaboration with partners from the specialist tyre trade. On the one hand this is important for fleet service itself, and it also helps large, centralised retreading facilities solve the unavoidable issue of casing procurement. Manufacturers such as Goodyear Dunlop, which aim to offer their clientele “premium mould cure retreading” as a supplement to their new tyre portfolios, rely upon a supply of own-brand casings. This particularly applies when the manufacturer – as was the case with Goodyear Dunlop’s Ultra Grip Max series – introduces its new tyre range and simultaneously launches a corresponding mould cure retread range that is theoretically available from day one, even if the used casings will in practice only become available by degrees. A tight network of specialist tyre partners can assist in such cases and ensure that non-COC casings are fed back into the Goodyear Dunlop system.
This network also works to guarantee blanket coverage for tyre fitting and subsequent fleet service. Dieter Schölling states that the tyre maker approaches its fleet business “in close collaboration” with the tyre trade. A handful of exceptions exist, such as when a large fleet wishes to carry out fitment itself. For all other fleets, the partners are responsible for sales, fitment and on-site fleet service within the scope of the fleet contracts between the tyre maker and customer, contracts designed to benefit all parties. “This business only works as a partnership,” comments the DACH director commercial.

To this end, Goodyear Dunlop can reply upon one of the densest networks in Europe and in the DACH market. Around 2,000 partners belong to the TruckForce service network in the 28 European countries where it operates. Of this, 360 are located in Germany, 50 in Austria and a further 20 in Switzerland. “Coverage in the DACH market works very well,” notes Schölling, adding that further strategic partners, even those outside the DACH region’s GDHS (Goodyear Dunlop Handelssysteme) franchise network, are constantly sought for a further build-up of the TruckForce network.