Chains
Citroen is recalling 900,000 aluminium rims, fitted to 180,000 C5 models sold before May this year, as a preventative measure. The wheels were manufactured by Michelin subsidiary Kronprinz (Solingen/Germany), who will bear the cost of producing replacements. The recall will be handled via the Euromaster and Viborg chains and analysts estimate that the total cost will be over 20 million Euro.
Shell has bought the chain of 11 Kwik-Fit car service centres in Poland for an undisclosed sum. The workshops will operate under the Shell autoserv brand name – currently there are over 150 Shell autoserv centres operating in Australia, South Africa, Mexico and Singapore. The purchase of the Kwik-Fit centres marks Shell’s first steps into the Polish car servicing market; a market that the company says is worth $855 million and which is growing at an annual rate of 4.6 per cent. Graeme Robinson, MD of Shell autoserv in Poland, says that the company plans to have a network of 70 service centres operating in Poland by 2008.
Fit4Fleet, the GM-backed network of independent tyre dealers supporting company car fleets, has extended operations to provide coverage in the Republic of Ireland as part of plans to provide customers with extensive coverage throughout the British Isles.
Managing director, Dominic Bateson, believes that the move will also bring a great improvement in the service standards enjoyed by fleet drivers in the country, saying: “Most of the tyre chains that have traditionally serviced fleet drivers are concentrated around the main conurbations, such as Dublin, Cork and Waterford. But what use is that to drivers having a tyre problem out on the road, many miles away from one of those cities? Their needs have to be catered for also. To us, this was an obvious gap in coverage and one of our core objectives has been to establish a comprehensive spread of centres throughout the Republic, so that when a driver has a problem, assistance can be provided promptly.”
Fit4Fleet already has 60 centres in the Republic, with at least one in each of the country’s 26 counties, and personnel at each centre have undergone training to ensure that they are fully able to meet the standards required. This means that the network now numbers more than 900 depots in the UK and the Irish Republic.
Back in May 1996, Kwik-Fit was on the acquisition trail, buying a number of independent chains. The then Chairman, and yet to be knighted, Tom Farmer, said that the group was aiming to build up a second retail chain, made up of regional companies with a strong local presence. They would retain their original identities and, in some cases, compete with local Kwik-Fit centres. Although there was no national identity, the second chain did have a name – Tyre Plus. Now, almost exactly seven years later, the situation is very different, as Kwik-Fit has announced that Tyre Plus is to be integrated into the group’s core operation, with all the fast fit business coming under a single management structure. Kwik-Fit, under its new owners CVC Capital, has been undergoing an extensive review of all aspects of its operations and the decision to integrate Tyre Plus is the latest result of this process. So what will it mean? Firstly, the Tyre Plus head office in Motherwell will be closed, as will other support offices around the country. The Tyre Plus chain consists of 256 centres and the initiative will see the closure of less profitable centres and those that compete with Kwik-Fit centres. In all, 140 Tyre Plus centres will be closed, with the remainder being re-badged as Kwik-Fit centres. What will happen to the employees in the centres that are to close? Kwik-Fit says that “the majority of staff affected will have their employment transferred to Kwik-Fit” and that the company is working closely with the T&GW trade union to ensure that staff are aware of their position and the proposals on offer. Redundancies will be kept to a minimum and Kwik-Fit will make a further announcement after having consulted with the T&GWU. When the dust has settled, the number of fast-fit centres being managed within Kwik-Fit GB will total over 700 and it is an indication of how the trade – and Kwik-Fit’s aspirations under the new management – have changed as, before the company was sold to Ford, its stated aim was to be operating from 2,000 service points by the year 2005.
A management buy-out finally helped the Group to divest itself of their trade chain NTS, which has been in the red for some time. It is said that over the last three years only, they had to meet with losses of more than 50 million Euro. And despite of a turnover of more than 200 million Euro, even Vergölst, another trade chain, also failed to avoid considerable losses. In an interview with NEUE REIFENZEITUNG, Dr. Hartmut Wöhler, the Group’s director for trading activities, however assured NEUE REIFENZEITUNG that after last year’s losses of almost a double-digit million sum, this year is ought to see a “black zero”. For Wöhler these unsatisfactory results, amongst others, were due to the repeated management changes which had impacted upon these trading chains over the last 20 years, resulting in a lack of continuity.
A report in the magazine Which? – published by the UK Consumers Association (CA) – has accused fast-fits of recommending unnecessary work in almost a quarter of cases. The CA took a test car to 93 depots, belonging to seven of the UK’s largest fast-fit chains, and says that 23, split across all seven chains, recommended unnecessary work. In response, one of the companies involved – Kwik-Fit – says that it has not been given detailed information by the CA but, on behalf of all the companies involved, it takes exception to the implication that so many in the trade would intentionally mislead the customer.
Cooper-Avon Tyres has reshuffled many of its management team. André Korynevsky – responsible until now for retreading materials – has been appointed European Sales Director, liaising with the company’s offices in Germany, France and Switzerland. He will continue to manage the retread materials business. Phil Caris is the new European Sales & Marketing Director with responsibility for multi-brand strategies, coordinating global product management. As European Major Accounts Director, Steve Cundy will head a team of three, which will service the business with European retail chains, marketing Avon house and private brands, as well as developing fleet business.
High growth rates in the winter tyre business brought Bridgestone/Firestone a strong 1999 result. Turnover figures were further improved over the previous year, according to the management, with prestige products “WT 12” and “FW 930”. To ensure this is not just a “one-off” success, a new high-performance low-profile tyre, the “Bridgestone RE 040”, already fitted as original equipment on the new BMW Z8, is to be introduced this spring. In the standard tyre segment the “Firestone FH 590” is also expected to convert the company’s 2000 performance into figures. A new departmental structure has been introduced at Bad Homburg to increase work efficiency and customer friendliness. Some divisions, like distribution, logistics and data processing, have been more closely interlinked. In the last few years the OE share has grown considerably so that it now amounts to one third of sales. The independent tyre trade continues to be the basis of the company’s business activities but is supplemented by other distribution channels like cooperatives, regional chains and car franchise firms, whose special requirements are, above all, seen as an opportunity to gain more know-how and to sense the needs of the market even earlier. This year again the whole public relations effort of Bridgestone/Firestone Germany will very consciously be centred round motorsport and Formula One in particular. Previous experience has shown that the manufacturer and its trade partners have benefited from the resulting image transfer to the standard tyre range.
A report by the Consumers Association says that UK franchised motor dealers cannot compete effectively against rivals in every area of business, from new car sales to servicing. When it comes to repairs and sales of spare parts, the dealers cannot match prices and performance of competitors such as the large fast-fit chains, the study concludes.
Paul Harrell, the MD of Dunlop-owned retail chain Motorway, has been appointed General Manager, Retail operations UK by the Goodyear group. In his new role he will be responsible for the operations of both Motorway and Goodyear’s Hi-Q retail chain.
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