"Retreads are the replacement tire of choice in North America."
Outsourcing tire management could be one of the major changes the trucking industry experiences in the next millennium. The time and the headaches associated with the purchasing and maintaining of tires, and the service calls associated with road hazards, could better be utilized by most fleets to focus on their core trucking business
Roadway Express, one of the nation's largest LTL carriers, set the precedent in the present millennium by signing a contract in February of 1999 with Tire Management Solutions Inc. (TMS), a wholly owned subsidiary of Bandag Inc. Other major fleets are expected to sign TMS contracts in the next six months.
Will virtually all fleets be following this trend? Not necessarily, according to Bandag officials, but there will be a trend for fleets to rely more on their tire vendor for a lot more types of service and tire solutions.
Prime Inc. is a good example of the kinds of specialized services a fleet might be looking for. Prime has thousands of trailers on the road and a program to make sure the tires on those trailers are road-worthy and ready to keep the customers' freight moving. Because those trailers might stay in the system a long time before they reach a company terminal, Prime's maintenance manager, Bud Rodowick, set up a drop-yard tire inspection and maintenance program with Bandag dealers in 14 cities. With less than a year of experience he has already seen a 22% reduction in tire-related road service downtime.
Fleets will also be looking for out-of-service tire analysis, data collection, rim and wheel refinishing, road service, and Bandag's Application Specific products. But coverage could well be one of the most important factors in selecting a tire supplier in the next millennium, especially for fleets whose trucks travel any distance from a domicile terminal.
Bandag chairman Martin Carver says, "We think our Strategic Dealer Alliance, which includes over 1,600 sales and service locations in North America, is the real key to our success. Regardless which of the service, program, or product options a fleet selects, delivery can only result when you have a distribution network that is well trained and committed to the vision of reducing fleet operating costs by extending tire life through retreading, repair, and tire management services. Quite frankly, the independent dealer with the options of various new tire brands is in the best position to recommend to the fleet customer the new tire brand that will maximize his return on investment. Since only about 30% of your tire investment is realized when the original tread is worn off of the casing, the retreadability of the new tires you purchase is critical."
Bandag has played a key role in making retreads the replacement tire of choice in North America. Last year, truckers and fleets in North America purchased 19.4-million retreads compared with only 14.5-million new replacement tires.
As we enter the new millennium, even new tire companies have entered the North America retreading market in an attempt to capture some of those wheel positions. Many of them have even attempted to copy the programs and services offered by Bandag.
But Bandag COO Sam Ferrise says, "When it comes to a comprehensive package of values, only Bandag has the real McCoy." It is that large selection of tire options and strong distribution network that should continue to make the Bandag name a dominant factor in the commercial-tire industry in the next millennium.