Truck Tire Market Report: Stay On Top of Customers' Needs, Says Alliance's Sheehey
“The best advice I can share is to stay on top of your customers' needs, especially during this period of uncertainty and change,” says Brian Sheehey, vice president, marketing, Alliance Tire Americas Inc.
In this interview, Sheehey dispenses additional advice for commercial tire dealers, discusses the impact of COVID-19 on Alliance’s truck tire business, previews new truck tire products that are in the works and more.
MTD: How did the COVID-19 pandemic and resulting government actions impact your commercial truck tire business in the United States and Canada?
Sheehey: Alliance Tire Americas (ATA) experienced a mild first quarter of 2020, but April saw an increase in demand for our Galaxy, Constellation and Aeolus TBR brands. Between warehouse inventory and containers on the water when our Alliance Tire Group manufacturing plants were briefly shut down by the COVID-19 emergency, we have been able to maintain a steady flow of truck tires to the marketplace.
MTD: A number of tire manufacturers temporarily suspended production at their U.S.-based truck tire plants. It is expected that these shutdowns and/or production suspensions will have a dramatic impact on truck tire shipments for the rest of the year. Can you quantify expected shipment declines?
Sheehey: Due to the COVID-19 pandemic, we had to temporarily suspend production in our plants in Tirunelveli and Dahej, India, for a few weeks while our plant in Hadera, Israel, continued to operate at full capacity. Our Indian plants resumed production in late-April and we have inventory of tires across the U.S., so we do not expect any significant impact on our truck tire shipments for the remainder of the year.
MTD: New Class 8 truck orders and new trailer orders have dropped dramatically in recent months. What effect is this having on your OE business, if applicable? And how will the knock-on effect of low OE channel demand impact replacement tire sales?
Sheehey: ATA’s truck tires sales are concentrated in the replacement market. Our focus has been on supplying our dealers with the recently launched Galaxy TBR brand, expanding our application offerings and ensuring maximum fill rates to meet just-in-time delivery needs. The replacement market is likely to see an increase in demand as owner-operators and fleets invest in keeping their current trucks and trailers safe on the road.
MTD: When do you expect OE and replacement tire demand to bottom out and when will demand – in both channels – start to rebound? What are you doing to prepare for this?
Sheehey: We started to see replacement tire demand rebound in mid-to-late April, once the pandemic situation and resulting government actions became clearer. Our new Galaxy brand TBR line is being manufactured at one of our plants in India since the government lifted its restrictions in late-April. Prior to the Indian government's restrictions that temporarily suspended manufacturing, ATA's four North American warehouses were stocked at 125% above normal seasonal capacity, so we have been able to continue supplying our customers here and help keep truckers rolling. With our manufacturing back on-line, we will be releasing new Galaxy TBR models, as scheduled, early in the third quarter of this year.
MTD: Truck tire dealers have played an instrumental role in keeping fleets up and running during the COVID-19 pandemic. What are you doing to support your dealers? What advice do you have for them during this challenging time?
Sheehey: ATA proactively set up online product training seminars for our dealers and OEM partners and their staffs, who—due to work or travel restrictions—were able to spend an hour a day learning about the sellable features and benefits of our products, and about technological innovations in design technology and compounding that benefit the dealers' bottom lines, as well as the performance of truck fleets, farmers, loggers, construction and industrial machinery owners, and the other segments we serve on and off the road.
“The best advice I can share is to stay on top of your customers' needs, especially during this period of uncertainty and change; be proactive in anticipating customer service needs and maintenance requests; respect the safety protocols at your customers' locations; and provide superior response times,” says Sheehey. “This is a time when your customers really see the value of working with a dealer they trust – someone who can give them solid advice and great service. Dedicated tire dealers have been on the front lines throughout the past few months, keeping truckers safe on the road and helping them stay in business and keep our economy alive.
“We should all be proud to be part of this industry and proud of the role we are all playing as we begin to rebuild our economy.”