News articles on the tyre retail business
…or are we about to witness a real dip in tyre markets? While the massive drops in OE demand of a few years ago appear to have turned a corner, and while tyre manufacturers the world over are steadily ramping up production to pre-recession levels, some are questioning whether or not replacement markets have really felt the full force of the recession. Could 2011 be shaping up to be worse than 2008/2009?
Devon based Team System's now has over 150 IT services contracts in Ireland, having confirmed the 150th “Team”-member earlier this year. Team already has an extensive UK client database where the company oversees the online business activities of hundreds of tyre retailers and wholesalers. Team Systems managing director, Steve Greatrex reports that this development in the Irish market is further proof of the company standing as one of the UK's largest and most accomplished IT service providers:
Bridgestone Americas Tire Operations (BATO) has announced two key appointments, both of which take effect immediately. Saul Solomon, previously president of BATO’s US & Canada Commercial Tire Sales division, has been named president of Bridgestone Americas Tire Operations, Latin American Tire Division (BATO LA). Solomon succeeds Humberto Gomez, who announced his retirement from BATO LA last July. Ken Weaver, formerly chief financial officer of Bridgestone Americas, has succeeded Solomon as president of US & Canada Commercial Tire Sales at BATO.
You get what you pay for. That’s the clear message Continental was communicating to fleets, safety associations and the trade at a series of Continental experience days the company has been running at MIRA this year. The firm also ran presentations and demonstrations on the benefits of greater tread depth, winter tyre usage, OE development and the evolution of its on ContiSportContact range.
H2 Equity Partners has announced plans to acquire a controlling stake in Unipart Automotive, the UK’s largest independent supplier of car parts, workshop consumables and garage equipment. Unipart Automotive is currently owned by Unipart Group. The agreement, which is expected to be concluded shortly, sees H2 Equity Partners taking majority ownership in the UK operation. Unipart Group will hold onto 49.9 per cent. Patrick Kalverboer, managing partner at H2, will become executive chairman of the new company.
A new addition has been made to Nokian Tyres’ Hakka summer tyre range. Called the Hakka Blue, this latest product from the Finnish tyre maker is designed with ‘northern’ roads in mind and thus is intended, in Nokian’s own words, to offer “the best possible traction and precise handling for challenging wet roads.” The Hakka Blue is aimed at high-powered cars and is produced in a total of 21 sizes in V and W speed ratings for 15 to 17-inch rim diameters. All dimensions offered will be XL marked. Retail sales of the new tyre will begin in spring 2012 in Nokian’s most important market areas: the Nordic countries, Russia, and Ukraine, as well as Kazakhstan and Belarus.
Following yesterday’s confirmation of the news that Michelin and Double Coin have entered into a China-based tyre production joint venture, financial analysts shared their views about how this fits into the French tyre giant’s wider strategy. According to Deutsche Bank, the new joint venture run plant is already being built and is expected to cost approximately 390 million euros. The analysts also confirmed earlier reports that the factory will have a capacity of 15 million units annually. For the time being the agreement remains subject to approval by the appropriate Chinese authorities.
A survey conducted by HiQ suggests that one in two British motorists are risking thousands of pounds’ worth of fines and potential driving bans by making journeys on dangerously worn tyres. 42 per cent of cars surveyed had at least one illegal tyre, with major areas of concern in the Birmingham, north east and Cheshire areas of the UK. The results are significantly up from HiQ’s last audit in 2009, when 27 per cent of motorists were driving on illegal tyres. HiQ’s retail development manager Farrell Dolan said that the results proved that despite years of highlighting the danger of bare, worn tyres, the safety message is still not getting through, saying that now the company will alter the tyre safety message it transmits to its customers.
After an eight-year long mutually beneficial relationship Maxxis International UK Ltd has decided to part company with its long-term distribution partner Grouptyre. The news came in the form of an announcement that the two companies have ended their exclusivity agreement, which implies that the firm will continue supplying Maxxis tyres for the time being. However, Tyres & Accessories understands that there is more to the story than that.
Tyre manufacturer Maxxis’s eight-year exclusivity agreement with independent tyre wholesaler Grouptyre has been ended. A joint statement issued by the companies revealed that, following a review of their distribution arrangements, and “in light of their future plans”, they “have agreed by mutual consent that Grouptyre will no longer act as the sole distributor for Maxxis in the UK.” The statement also made clear that Grouptyre’s distribution of Maxxis products will continue in spite of the expiration of the exclusivity agreement on 30 September 2011.
Brighton’s Blackrock Tyres has signed up for Cameo from Cam Systems, a software platform that allows tyre retailers to reduce their reliance on paper and streamline business tasks. The company’s director Keiren Saitta used the Cameo application for 10 years with a previous employer: “Cameo is really easy to use and is excellent for running the business. It provides me with all the accounting, stock control and point of sale functions I need and has completely got rid of the need for pen and paper!”
It is certainly not the only development to take place within Bond International during 2011, but the wholesaler's recent launch of Tyregiant.com is likely to be the most headline-grabbing. Over the years various sources representing all the UK's largest tyre wholesalers have spoken of their capability of offering an online retailing capability, but up till now few – if any – have ventured onto the information superhighway. The solitary pioneering effort in this area was Grouptyre's GoodTyreGuide, which ambitiously seeks to fuse retailing, reviewing and wholesaling through its membership of whole operations. A year on from that, with the jury still out on whether this concept has delivered the kind of results expected at launch, Tyregiant is pitching itself as a straightforward retail site for consumers. The clever part for Bond (a company that has always shied away from retailing itself so as not to alienate its business to business customers) is that, like GoodTyreGuide before it, it is seeking to offer additional business to its customer base rather than itself becoming a competitor.
Based just North of York in Pocklington, the relatively small size of this North Yorkshire town belies the current scale and influence of the tyre wholesale operation it is home to. Bond International was founded in 1966 by Reg Bond when the qualified automotive engineer suffered an industrial injury that blinded him in one eye. In spite of the incident, Bond demonstrated great vision by investing his ensuing compensation into expanding his business to incorporate tyre wholesale. Now the company is firmly in the top flight of UK tyre wholesale operations and has purportedly risen as high as number three in recent years (see next month's Wholesale Feature for an update on the current state of UK tyre wholesaling). With an overseas office already located in Singapore, now Bond is considering its European options, while pointing out that there are still opportunities in the UK. On top of this the company recently launched its first foray into the online marketplace, which executive hope will – over time – develop a whole new source of business for it and its retail customers alike.
In the final quarter of 2010 Bridgestone announced that it was reorganising its European operation into key “regions“. At the start of 2011, this plan entered its second phase with the establishment of the North Region (consisting of the UK, Denmark, Norway, Finland, Ireland and Sweden). As a direct result of this, there were a number of promotions for executives at the company’s UK headquarters.
On 1 January 2011 John McNaught became North Region managing director with Sam Enya as the North Region deputy managing director and also sales administration director. At the same time John Folliss became North Region commercial sales and marketing director with Andy Lane taking the position of North Region consumer sales and marketing director. Six months into his new role, Tyres & Accessories met with Andy Lane and learnt details of how the company sees the UK and other North Region markets progressing or otherwise this year and how the new approach positions the company to deal with this.
There is no question that winter 2010/2011 was a great success when it came to the sales of cold weather tyres. Many wholesalers and distributors found that their projections were far too low; some wholesalers reported that they sold three to four times more than they expected, while tyre manufacturers said they would have supplied more if their factories could produce them fast enough.
The fact that it was the second consecutive “severe” winter in the UK really helped drive home the issue. And the combined efforts of retail chains; car dealerships and the industry mean that there is still momentum in this pre-season before the mercury drops. ATS Euromaster for example bought in £3 million of winter tyre stock last season and are doubling it this year, (see separate article for more details). Meanwhile Mercedes and BMW began promoting tyre hotels, making the two-sets-of-wheels model a reality. But what about this winter and the winters to come? Tyres & Accessories asked Bridgestone North Region sales and marketing director Andy Lane, who has the unique responsibility of overseeing sales in the classic winter markets of the Nordic countries and the more complex and temperate conditions of the UK.
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