News articles on the tyre retail business
In the USA, the TIA says it is still working to either reduce or eliminate the added tariff placed on China-made consumer tyres by the Obama Administration last September, reports Tire Review. The three-year tariff adds 35 per cent to the price of consumer tyres exported to the US from China, dropping to 30 per cent in its second year and 25 per cent in the third.
Russell Smith from Kent has won the £2,000 holiday of his dreams courtesy of Bridgestone and Guildford Tyre Company in Horley, Surrey, having won the manufacturer’s ‘Ultimate Winter Excursion’ competition. The competition was held in association with 500 dealers, to promote the benefits of having your tyres checked and encourage more motorists to carry them out. The vouchers allow Russell to choose from prizes such as a skiing holiday, husky safaris or an exotic getaway to a faraway shore.
Tirecraft Canada said its new associate store program has been a huge success, resulting in the addition of nearly 120 locations since it was relaunched in 2008, reported Tire Review. “This is the best possible endorsement of our programme’s strong value proposition and our new fully engaged, highly energized management team,” Tirecraft president Don Gauthier said. “We are all squarely focused on delivering added value to our customers at all levels and across all segments.”
Louisiana’s Delta World Tire Co. opened its 15th retail tyre and automotive service location last month, Tire Review reports. The new location in Biloxi, Mississippi, has eight service bays and a warehouse. In addition to the new Biloxi location, Delta World Tire operates five other Mississippi locations in Pascagoula, Gulfport, Waveland and Picayune, and has nine locations in Louisiana, including Lake Charles, Lafayette, New Iberia, Houma, Kenner, Metairie and New Orleans.
Goodyear Dunlop Tires Europe has appointed George Rietbergen as managing director UK and Ireland. Rietbergen will move to Birmingham to take over from Mark Brickhill, who has been promoted to vice-president of the company’s Consumer Business Unit EU. The appointment means Rietbergen is Goodyear Dunlop UK and Ireland’s third managing director since 2004.
What will the tyre retail business look like in five years time? Who knows. As I have learnt to my peril in this column, prognostication is a dangerous business. Let’s not recall how last year I wrote “unless there is an unlikely stay of execution” regarding the implementation of s-marking regulations (see T&A’s August 2009 issue for more on this). But I digress.
The news at the end of February that Halfords bought Nationwide Autocentres for £73.2 million (see page 14 for complete coverage) says something about how tyre retail is evolving. Along with the purchase announcement came plans to rebrand the chain and the affirmation of existing plans to double the number of branches to 424. When you consider that the second largest tyre retail chain in the country, ATS Euromaster, reported that it was “reviewing” up to 80 of its 456 branches last September, it is clear that size gap between chains at the top of the two sectors is narrowing. True, Autocentres don’t focus on tyre sales like the traditional outlets do, but there are signs they are considering how to increase their focus in this area.
Dunlop has launched its High Performance Centre retail concept with an event at the first of its outlets in Northampton. The centre will be operated by existing Goodyear Dunlop customer Tyres Northampton, encompassing many of the features that the company says will distinguish these centres from the rest of the company’s nationwide network. These include a Dunlop-branded reception and lounge designed in a similar style to Dunlop’s VIP racetrack hospitality areas. The Dunlop High Performance Centre partnership programme also includes training for technicians, exclusive Dunlop promotions and quality standard auditing for the stores. The event was attended by leading tyre dealers.
Founded in Pocklington over 40 years ago, Bond International now occupies a 140,000 square foot site on the town’s industrial estate and employs nearly 100 local people. In addition, the company operates distribution depots in Chepstow, Stevenage and Redditch, which together employ a further 90 people. And adding an international flavour to the operation are representative offices in both China and Singapore. Bond International reports that these two offices assist in the sourcing of brands that provide an alternative to the ‘premium manufacturer offer’. By researching new and competitively priced manufacturing facilities around the globe, Bond has been able to offer exclusive mid-range tyre brands. An example of this is Infinity.
With 224 branches already and another 200 on the way following Halfords’ acquisition of the business, Nationwide Autocentres is on the brink of truly becoming a nationwide operation. And while the company’s core business is MOT and servicing rather than just tyres, the scale of the new business alone is likely to have some degree of impact on national tyre sales.
Nationwide currently reports that it serves 500,000 customers each year. These are a mixture of fleet (25 per cent of revenues) and private (75 per cent). The company’s strategy is to differentiate itself within its market by being the only national operator to provide dealership quality service at lower prices. And this customer proposition is supported by a strong website. With companies like Kwik-Fit increasingly offering a wider range of services and companies like Nationwide increasing their interest in tyres, the gap between the traditional tyre specialist and autocentre is narrowing.
The latest developments in Halford’s complex car servicing history (see Halfords Buys Nationwide Autocentres for £73.2 million – 18/02/10), bring with them a distinct sense of déjà-vous and highlight the cyclic nature of ownership in this industry. From Halfords point of view the latest venture represents a new beginning for a business that is radically different to when it last tried car servicing.
Online tyre retailer Popgom was founded in France in 2008 by Christophe Tesseraud, previously European CIO at Michelin. The tyre major is a minority (approximately one-third) shareholder in the business behind Popgom, Tyredating SAS, and today the firm operates retail tyre portals in France, Spain and Germany. Company representatives claim that a site catering to the UK market will be established in 2010.
Halfords Group has bought Nationwide Autocentres in a £73.2 million deal, which managers described as the next “logical step” in its expansion plans. Nationwide, which has been owned by private equity group Phoenix since 2006, employs 900 mechanics and serves roughly 500,000 customers a year. Nationwide offers customers and fleets MOTs, servicing and repairs, but also recently increased the emphasis on tyres at its 224 outlets.
Ian Fraser, CEO of tyre retail giant Kwik-Fit is preparing to sell its insurance wing for in excess of £200 million. According to a report published in the Sunday Times on 14 February, Kwik-Fit has hired bankers at Credit Suisse to carry out a review of Kwik-Fit Financial Services. The report points out that a sale of the operation would help Kwik-Fit cut its debts of around £822 million.
On 10 February Kwik-Fit Group announced that is has entered into a Frachise agreement with the ROLF Group, one of Russia’s leading automotive businesses. According to the company, the Russian centres will be established under a new brand – ‘White Service’ – for which Kwik-Fit has established a dedicated support team. As well as providing on the support “on the ground” in Russia, Kwik-Fit is inviting White Service managers to visit the UK to shadow their UK counterparts and share expertise. Prior to this deal Kwik-Fit gained similar experience with over 200 existing franchise outlets across eight countries.
Marketing agency Wunderman has reportedly been given the task of revising the Europe-wide customer relationship management and communications strategy for Conti Trade, the organisation in charge of Continental’s retail activities in much of Europe. In 2009 Conti Trade reported achieving a turnover of more than 700 million euros, with its Conti-Trade-Network covering more than a thousand service stations in Austria, Belgium, the Czech Republic, Germany, Ireland, Norway, Poland, Slovakia, Spain and Switzerland.
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