SRNA Talks Growth Plans, Supply and More at Falken Meeting
During this week’s Falken Tire dealer meeting in Aspen, Colo., executives from Sumitomo Rubber North America Inc. (SRNA) outlined the company’s position within the market, its growth plans, industry supply issues and new product offerings that will be launched in 2022.
Matt Leeper, vice president of sales for SRNA, said “our growth has outpaced the industry in 17 of the past 18 months.”
Currently, the company says it has a little over 3.5% of the total U.S. replacement tire market, with passenger tires standing at 3.8%, light truck at 2.7% and TBR at 2.6%.
SRNA is now approaching the U.S. market through a diversified marketing and distribution organization utilizing four different channels - independent tire dealers, distributors, large retailers and TBR specialists.
Leeper emphasized that the company is backed by Sumitomo Rubber Industries, the fifth largest global tire manufacturer.
The Falken brand has also been available at the original equipment level. Leeper said the brand has “small market share" at OE, but has “some really cool fitments.”
SRNA also has aggressively pushed its Fanatic dealer program. There are now nearly 10,000 Fanatic dealers on the books, up from 3,000 in 2018.
The company also has policed its Minimum Advertised Price (MAP) program in the marketplace, he added.
During the meeting, Rick Brennan, SRNA vice president of marketing, addressed the supply issues facing the industry at the present time, stating that COVID-19 “created a dramatic change for everyone.”
He used months-on-hand (MOH) as the barometer for inventory management.
When COVID-19 shut down the industry in April 2020, MOH spiked to six to seven months, well above normal.
As 2020 moved forward, demand spiked, while inventories shrunk dramatically. Plant closures, shipping issues, tariffs and employment issues were the leading causes of this, said Brennan.
Fast forwarding to this month, Brennan shared current U.S. Tire Manufacturers Association production/import figures.
Currently, passenger tire inventory stands at 1.9 MOH, 5 million units below average. P-metric light truck tire inventory is at 1.7 MOH, 2.8 million below average. Light truck inventory is 1.4 MOH, which is 1.2 million below normal, and TBR is at 1.3 MOH, which is one million below normal.
Brennan expects supply to remain tight through the end of 2021, with passenger tires trending upward in the first part of 2022.
TBR will be tight throughout all of 2022, he noted.
SRNA has been investing heavily in its Buffalo, N.Y. plant, with production growth for PLT to be at 8% in the fourth quarterof this year, with TBR growing 25% and motorcycle at 14%.
By Q4 2022, PLT should increase by 38%, TBR by another 7% and motorcycle by 7%. Currently, Brennan said Falken’s fill rate is roughly in the 75% to 85% range.
Visit www.moderntiredealer.com tomorrow for more information about new Falken brand products.