Fast boat from China

Dec. 17, 2008

Nobody believes in the quality of Chinese-manufactured tires more fervently than Jeff Kreitzman, CEO of American Pacific Industries Inc. (API), but not all Chinese-made tires are equal, he says.

Product quality varies by company and factory, according to the outspoken executive. “Our tires are so significantly different,” he says.

Why? For starters, Kreitzman explains, API conducts its own research and development.

“This has been a huge part of our success. We design our own products.”
Medium truck tires will make up about 40% of API’s total $210 million in sales this year.

The company recently introduced the latest addition to its Gladiator medium truck tire line, the Gladiator QR35-TR, to the North American market. The QR35-TR is designed for trailer applications and is lighter than previous-generation Gladiator products. (Gladiator is API’s only medium truck tire brand at the moment.)

It contains a special tread compound for chip and chunk resistance, plus bead and shoulder elements to reduce heat build-up and other features.

Kreitzman recently brought CTD up-to- speed on API’s medium truck tire program, including upcoming products and plans for the firm’s dealer network in the United States.


CTD: The new Gladiator QR35 -TR is available in four sizes: 11R22.5, 11R24.5, 295/75R22.5 and 285/75R24.5. The Gladiator line seems to cover the whole gamut of popular truck tire sizes...

Kreitzman: ... and we’re moving into wide-base tires and also some specialty sizes and designs. We’re in the process of developing a true front-end long-haul tire.

CTD: At what stage is your wide-base project?

Kreitzman: We’ll be launching a size  315/80R22.5 tire, a 385/65R22.5 and a 425/65R22.5 by the end of the year.

CTD: Will these tires be based on an existing model?

Kreitzman: They’re going to be based on our current QR88-MS tire. We’re currently delivering it in tall tires: 11R22.5 and 11R24.5.

CTD: Some tire manufacturers believe wide-base truck tires aren’t going to be mainstream products and are more for niche applications. Do you agree with that?

Kreitzman: Everybody’s looking for lower rolling resistance and improved fuel economy. It’s proven that wide-base tires on trailer applications are more fuel efficient, and you can still get the loads out of them. I think wide base is the future. I’m seeing more of them on roads.

We’re not a primary tire supplier; we’re not a Michelin or a Bridgestone or a Goodyear. We’re trying to be a very good second-tier supplier. We’re not necessarily going to set the trend because our customers are going to dictate what they want. If they see a lot of wide-base tires in the marketplace, then there’s room to bring the tire in. We’re going to build it for them.

CTD: You have two plants in China. Are they operating at maximum capacity?

Kreitzman: We just expanded to a second plant this year because we were at maximum capacity at the first plant. We’re not at max capacity now. But our sales are good; we’re not sitting around trying to figure out where we’re going to sell our tires.

CTD: How many Gladiator brand truck tires do you ship to the U.S. each year?

Kreitzman: This year has been one of our better years. This year we should end up at around 550,000 units. In 2009, we expect that number to be close to 800,000 units.

CTD: Do you have plans to aggressively expand your dealer base in the U.S.?

Kreitzman: We have a pretty good dealer base. We’re going to nurture the dealers we have. We have a lot of new products coming on line so our growth will come from within our existing dealer base and with the new products we’re developing.

We’ll add a dealer here and there, but we’re not going to get crazy and lay dealers on top of each other.

“We have a nice mix of wholesalers and bolt-on dealers,” says Kreitzman.
“The majority of our business comes from the bolt-on guys. Those are the guys who give you immediate feedback about how your product is doing.”  
He says API is developing a second medium truck tire brand, “but we don’t want to release its name.”  ■