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Bob Ulrich's Editorial

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May 28, 2014

‘Made in America’

That phrase still has meaning to tire dealers

by Bob Ulrich - Also by this author

Did you know that the song “Born in the U.S.A.” is more anti-American than American in attitude? Bruce Springsteen wrote it to protest the treatment of veterans returning from the Vietnam War.

Even today, 30 years after the gritty song hit the airwaves, people continue to fixate on the chorus — “Born in the U.S.A., I was born in the U.S.A.” — rather than its true meaning.

I believe patriotism (not blind patriotism) is always a good emotion. Working together and looking out for one another makes a country stronger.

In our country, many consumers prefer to buy from domestic companies and seek out American-made products, including tires. There is nothing wrong with that, and tire dealers in the United States are happy to give the customers what they want.

The definition of an “American-made tire” is fluid, however, which makes it easier for dealers to sell it as such. Let me explain.

There are only two major American-owned tire manufacturers: Goodyear Tire & Rubber Co. and Cooper Tire & Rubber Co. Each of them has multiple manufacturing plants in the U.S.

So any tire with the name Goodyear or Cooper on it can be sold as American-made. What if the tire comes from a plant in China? I find it hard to believe where the tire is manufactured is ever mentioned by the person selling tires produced by Goodyear or Cooper, and that includes the Dunlop, Kelly and Mastercraft associate brands.

The tire may not always literally be born in the U.S.A., but because a domestic manufacturer controls all production, it’s still an American tire. That’s close enough.

It is no wonder many Cooper dealers were upset when Apollo Tyres Ltd., an Indian company, made Cooper shareholders a deal they couldn’t refuse last year. They were about to lose what they believed was a 100% American company, giving them less leverage behind the counter.

Cooper shareholders may have been upset when the deal fell through, but I’ll bet many dealers were not.

Regardless, I’m sure the Cooper brand would have remained an American brand in the eyes of the consumer. People still think of the Firestone, BFGoodrich and Uniroyal brands as American more than 20 years after foreign manufacturers purchased them.

And they really are, because they are still manufactured here. It’s hard to erase a brand’s legacy.

In contrast, the flagship brands of Bridgestone Corp. and Groupe Michelin are more closely associated with their parent companies. Many still consider them foreign brands, even though Michelin has more consumer tire production capacity in the U.S. than any other company, and Bridgestone is fourth, behind Goodyear and Cooper.

In Michelin’s case, that is particularly ironic. Michelin North America Inc. began producing tires in New York in 1950! It also has supplied aircraft tires to our military for years.

Three years ago, the U.S. Navy exercised a second five-year option to extend its tire supply contract with Michelin North America and Michelin Aircraft Tire Co. Inc. Later that year, Michelin North America was honored with a 2011 Secretary of Defense Performance-Based Logistics Award for its naval service.

Michelin also has had similar contracts with the Defense Logistics Agency (DLA) to supply aircraft tires to the U.S. Air Force, the U.S. Army and some allied foreign militaries. Michelin has been classified by the DLA as a “best value” tire, and has the awards to prove it.

Despite its military service, however, Michelin North America may soon suffer for the actions of its parent.

Earlier this year, the Wall Street Journal reported Congress and the Pentagon feel Michelin’s declaration that it would like to continue trade with Iran once international sanctions expire is at the very least wrong, and at the very most treasonable.

That is because the U.S. has sanctions of its own in place against Iran.

The result could be the end of any future business between the U.S. military and Michelin once existing contracts expire.

I am not going to jump to conclusions and say the government is out of line in this case. I certainly don’t know all the details behind the very complicated relationship between the U.S. and Iran, or the inner workings of the U.S. military, for that matter.

I will say government officials seem to overreact first, and make sense of it all later (if at all). I hope their maneuverings are not self-serving or based on political paranoia.

As you can see, we are part of a global industry, whether that refers to the logistics of production and distribution or political intrigue. Just be careful when you label what you are selling. It’s all relative.     ■

If you have any questions or comments, please email me at bob.ulrich@bobit.com.

To read more of Bob Ulrich's editorials, see:

Final words on tire aging

Premium vs. performance

ATD is OK with the FTC

Read the entire May issue by clicking on our digital version here.

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