Keegan: Assurance up, Dunlop down, private brands stable
Sales of Goodyear Tire & Rubber Co.´s Assurance family of tires have exceeded the company´s expectations, according to Bob Keegan, chairman, CEO and president.
Partially as a result, Goodyear posted tire unit sales of 25.7 million in North America during the second quarter, a 1.6% increase vs. the same period last year.
During a conference call addressing the company´s second-quarter results, Keegan discussed brand performance in North America.
1. Assurance. "There´s a buzz in the market today that is far exceeding our expectations," he said. Four North American tire plants are manufacturing the line, which includes the TripleTred and the ComforTred; new sizes are being added "as quickly as we can to meet demand." The company will ramp up promotion of the TripleTred´s all-season characteristics during the upcoming fall and winter seasons.
2. Dunlop. The brand "continued to be weak in the second quarter." The company hopes new tire introductions at the Specialty Equipment Market Association (SEMA) show in Las Vegas in November will give the brand a shot in the arm.
3. Private brands. The company´s private brand market share has stabilized "after falling a bit in the first quarter." Keegan said eliminating some private brands and skus beginning last year "has improved profitability."
Keegan also said Goodyear is having some success with its pricing. The company raised prices at least 2% on all tires on May 1. It recently announced another increase of up to 5% on all brands and across all product categories effective Sept. 1.
While its price increases in the consumer replacement segment are "partially sticking," price increases in the commercial tire segment have been embraced, according to Richard Kramer, executive vice president and chief financial officer.
"Our expectation is (dealers) will be able to pass through the (Sept. 1) increases. We think the price increases will be well accepted," added Keegan.