Why the Falken and Sumitomo Brands Are Sold Separately

Bob Ulrich
Posted on December 15, 2016

One year ago, Falken Tire Corp. announced it was changing its name to Sumitomo Rubber North America Inc. As of Jan. 1, 2016, that came to pass.

However, there is still some confusion about the name. Why? Because the Sumitomo brand is sold by TBC Corp., not Sumitomo Rubber North America.

And here's why TBC sells Sumitomo: In 2005, Sumitomo Corporation of Americas (SCOA), the largest subsidiary of Sumitomo Corp. of Japan, purchased TBC. Prior to the acquisition, the Sumitomo brand was sold by Treadways Corp., itself a subsidiary of of SCOA.

After the purchase, SCOA placed Treadways Corp., and the Sumitomo brand, under the direction of TBC Wholesale, which also oversees the TBC Private Brands division.

According to Falken, the dissolution of the alliance between Sumitomo Rubber Industries Ltd. (SRI) -- Falken's parent company -- and Goodyear Tire & Rubber Co. led to not only the name change, but also a realignment of SRI’s North America business units. That includes Goodyear Dunlop Tire North America Ltd., which oversaw the Buffalo, N.Y., tire plant. The plant is now run under the name Sumitomo Rubber USA LLC.

Falken tires are being produced at the plant. Sumitomo tires are not.

If this all sounds kind of convoluted, it has its roots in the Japanese business philosophy of keiretsu. Here's how www.businessdictionary.com defines keiretsu:

"Grouping of large Japanese financial and industrial corporations through historical associations and cross-shareholdings. In a keiretsu each firm maintains its operational independence while retaining very close commercial relationships with other firms in the group. Horizontal keiretsus (such as Mitubishi Corp. and Sumitomo Corp.) involve firms in different industries whereas vertical keiretsus (such as Toyota Corp. and Sony Corp.) involve firms upstream and downstream of a manufacturing process."

Not much has changed since the name change. It's business as usual at the former Falken Tire Corp., with Richard Smallwood as CEO and president of Sumitomo Rubber North America (SRNA). Under the one-year-old corporate structure, SRNA operates three separate sales divisions.

1. Dunlop Motorcycle Tire, located in Tonawanda, N.Y., is responsible for Dunlop motorcycle sales to both the original equipment and replacement markets.

2. Falken Tire, located in Rancho Cucamonga, Calif., is responsible for replacement sales of Falken, Ohtsu and private branded products for the light vehicle and commercial markets.

3. SRNA OE Sales, located in Detroit, Mich., is responsible for Dunlop light vehicle tires for Japanese OEMs, and Falken OE tire sales for all North America OE customers.

So the former Falken Tire Corp. and TBC Corp. are run independently of each other by different companies. I hope that clears up all of the confusion. Just don't ask me to repeat any of this without a cheat sheet.

Related Topics: Falken Tire, OE tires, Richard Smallwood, Sumitomo Rubber North America, TBC Corp., tire plant

Bob Ulrich Editor
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