MTD History: Dealers Faced Tough Challenges 100 Years Ago
Some challenges that tire dealers face today aren't necessarily new. That became apparent as I was flipping through the March 1921 edition of Tires, which later became known as MTD. Here’s what was happening in our industry 100 years ago this month.
Headline: “Factories Calling Back Stocks From Dull Branches.” If you think supply is tight right now, know that tire dealers were grappling with shortages one century ago. “All (tire) factories report surplus stocks diminishing rapidly and have issued statements indicating that as soon as such supplies are completely exhausted, production will be increased commensurate with actual current demand. This is taken to mean that it will become policy in the rubber industry in the future not to provide too far in advance, but to keep production on an even keel and parallel with actual demand so as not to clog dealers’ shelves with surplus stocks and so as also to prevent a repetition of the crisis and necessary heavy retrenchment in the tire industry created when tire sales slumped last year.” (Miller Rubber Co. led the charge, becoming the first tiremaker to pull back tires.)
Headline: “Bill Would Legislate Tire Dealers Out of Business.” Much has been written in recent years about online tire sellers and their impact on tire dealers with brick-and-mortar locations. A century ago, mail order houses were the precursors to e-commerce portals. And they were in the spotlight - for political reasons. “Complaining that its adoption would drive them out of business in favor of mail order houses, the tire dealers of California have registered a vigorous protest against Senate Bill 655, which would tax motor vehicle tires 10%.” Proceeds from the tax would be used to finance road work. But mail order operations that sold tires weren’t required to pony up. California dealers were concerned that passage of the bill could “legislate them out of business,” leaving the market to the mail order channel. Thankfully, we know this did not happen, but at the time it was a major concern.
How about the overall economic situation? There are some interesting parallels. The fourth quarter of 2020 ended on a high note for a lot of tire manufacturers and dealers, many of whom have entered 2021 with a renewed sense of optimism. Readers of MTD were surfing a similar wave in early 1921, according to an editorial written by then-MTD Editor Jerry Shaw.
During 1920, the U.S. economy plunged into an acute depression caused by “massive inflation the Federal Reserve created to help the government finance World War I,” according to the American Institute of Economic Research. The situation was getting better by the time 2021 rolled around.
Happier days were here again, wrote MTD’s Shaw in an editorial titled, "Now, It's Optimism." According to Shaw, who was in frequent contact with both tire dealers and tire company executives alike, "optimism is rapidly displacing the darker-toned views held by many in the tire industry during the past nine months. There is nothing artificial or forced about the spirit of better times that now pervades the industry, for already a business revival has set in. Dealers throughout the country remark that there has been a marked quickening in their sales and they are looking forward to the present year being a highly successful one for them.
“All in all, it can be said that the tire industry has passed through the storm of general depression that has swept through the industrial world and that while still showing signs of the ordeal, it is making rapid strides on the road to recovery - and prosperity.”
Think about where our industry was 12 months ago. Now think about how far it has come since then. Some old things are indeed new again, as the old saying goes! Let’s all be thankful for that.