Prinx Chengshan Tire North America Inc. is focusing on ways to differentiate itself from other value-tier tiremakers. That means the Fortune and Prinx brands both are rolling out unique tread patterns. It means Prinx Chengshan is investing in consumer marketing to drive consumers into tire dealerships in the U.S. and Canada, and doing that in a unique way. (Pickleball, anyone?)
It also means both brands are offering comprehensive product lines that combined will have 450-plus SKUs that cover passenger, light truck, trailer and commercial truck tires by the end of 2024. And, those tires are all produced in factories owned by the brands’ parent company, Prinx Chengshan (Shandong) Tire Co. Ltd., which company leaders say provides steady production.
Most of the tires for North America are built in a three-year-old factory in Thailand.
Samuel Felberbaum, president of the business in North America, says, “Our goal is to continue to grow both brands. We see (a) huge light at the end of the tunnel. The growth for both brands is really good.”
Ken Coltrane, vice president of marketing and product development, says the first Fortune and Prinx tires entered North America in August and September of 2020. In the three years since, six million passenger and light truck tires have entered the North American market.
In the beginning, sales and marketing for the Prinx brand was handled by TBC Corp. But that agreement between the two companies ended on June 1. So now Prinx Chengshan is working to push both brands into the market.
Coltrane says, “One things dealers are going to see going forward is that it really is two different brands. Our latest tires, the Prinx HiSeason and the Fortune ClimaFlex, are two different tread designs. We’re not taking one tread design and just slapping a different name on a sidewall. That’s an initiative we’re taking as we develop new product lines and as we go to second-generation product lines.”
When the company launches new all-terrain tires in July 2024, those too will feature unique designs. (In 2021 it launched rugged-terrain tires under each brand that had unique patterns.)
The differences will extend beyond the tires’ looks. “Both brands will have a different feel,” Felberbaum says, noting different marketing agencies are working on each brand and marketing materials will have distinct looks.
"We're really trying to differentiate ourselves," he says.
The tiremaker is currently working to extend its dealer network throughout the U.S. and Canada. Pete Salvan, vice president of sales, says there’s been “positive growth on both fronts.
Felberbaum says, “We’ve really diversified our customer base, especially with having the Prinx brand back. We still have lots of room to grow in Canada. Lots of room to grow in the Midwest. We have lots of room to grow in every part of the country.”
Coltrane noted growth also comes in the form of extending the product line with existing customers as well.
“One of the things about our range, it lets us get in the door with people. This new four-season (tire) may get us in the door with somebody we’re not currently doing business with.”
Felberbaum adds, “And when you deal with us, it is not an all-or-nothing proposition. If you could buy some TBR from us, we want you to buy it. If you could buy some passenger product, we want you to buy it. We don’t come in and say you have to buy everything.”
Salvan says, “We believe people are going to have a positive experience and we will grow our business with them because of that positive experience. We’re trying to be easy to do business with as well. The easier you are to do business with, the more business you’ll do.”
One differentiator the two brands will offer is an investment in consumer marketing. It is already well underway with the Fortune brand, which is the official tire of USA Pickleball. The brand’s first TV commercial aired during the national championships in November, and as a result of filming that commercial, the brand has a trove of videos it can use to drill down to the point of sale.
Salvan says the company is working to make the Fortune and Prinx brands “best in class,” and the marketing investment is part of that. Nicole Moore, director of marketing, calls it another differentiator in the value tier.
Felberbaum says, “At the end of the day, it’s push-pull. We have to work with distribution and direct retailers to sell, to push the product in, but then we’ve got to help pull it through. The only way we can pull it through is by having some brand recognition. So when (dealers) say (to a customer) ‘how about a Prinx tire? How about a Fortune tire?’ If we’re doing our things right, we’re hopeful people are going to recognize that and get a great, high-quality tire at a fair, value price.”
All of the effort and energy Felberbaum and his team are putting into both brands comes with other forces at work in the marketplace. One of the big unknowns revolves around tariffs.
Because most of the tires Prinx Chengshan brings into the U.S. market are made in Thailand, the current anti-dumping investigation of truck and bus tires imported from Thailand brings uncertainty. An existing tariff on passenger and light truck tires from Thailand is also in the midst of its annual review.
As for the truck and bus investigation, Felberbaum and Coltrane both testified at a November hearing with International Trade Commission staff. Coltrane says, “We don’t think the U.S. truck tire market is being inured by truck tires from Thailand.”
While the United Steelworkers union and its attorneys is alleging that tires are being dumped in the U.S. market at below-market prices, Coltrane notes the price of Thai tires increased dramatically as a result of the shipping crisis.
“At one point freight cost on TBR tires was $74 a tire during the peak of the freight crisis. Now that same tire might be $13. Prices have come down drastically.”
But how the International Trade Commission and Department of Commerce evaluate the market will be what ultimately matters. Both parties will investigate the issue throughout 2024.
On the passenger and light truck tire side, Coltrane expects most of the anti-dumping rates to decrease, but that final determination is still yet to come.
In the meantime, dealers are asking if a drop in those rates will result in a drop in prices. ”Let’s say they think your anti-dumping is doing go down by 10%, well that doesn’t mean our freight is going down by 10%.” Raw material prices are also trending upward.
Felberbaum says, “At the end of the day, if the TBR anti-dumping duty goes into effect it harms the people who need it the most because everything’s going up. Our prices will go up. The wholesaler will go up and it will go up to the end user.
“It creates a lot of uncertainty for our customers who are planning what they’re going to carry. For us right now, it’s business as usual. We’ll have a plan when this goes into effect, but (customers) really can’t plan because it’s unknown. I think that’s the biggest challenge.”