ATD explains General Motors supply arrangement

April 1, 2005

American Tire Distributors Inc.'s (ATD) recent announcement that it has been authorized to supply tires to 3,700 General Motors (GM) dealerships represents "an evolution" of the company's existing arrangement with the auto manufacturer, not a new deal, ATD official Ron Sinclair told today.

"We've had a relationship with GM for years as part of their 'On a Roll' tire program," says Sinclair. "It's been a long-standing relationship."

The arrangement allows GM dealerships to order tires directly from ATD but it does not bind them to ATD, he explains.

"We know there are many tire distributors that serve GM dealerships. It's an open market. GM authorizes their suppliers. It's up to them."

ATD will supply "whatever (tires) are authorized by GM." He did not identify which ATD-carried tires have won such authorization.

The Huntersville, N.C.-based distributor also participates in Ford Motor Co.'s "Around the Wheel" tire program.

"We see auto dealerships continuing to increase their focus on service, including tire sales."

It isn't ATD's intent to interfere with its independent tire dealership customers who presently sell to car dealerships, he says.

ATD's relationship with GM "does not preclude tire dealerships from working with local GM dealerships. The independent tire dealer represents our core customer."

Sinclair declined to reveal if ATD is seeking similar arrangements with other auto manufacturers.