Tire dealers see possibilities in Goodyear, Cooper deal

AKRON — Tire dealers expressed shock to learn the largest U.S. tire company was buying the second largest.

Many dealers wondered, in such an interconnected system of supply in the tire industry, how does Goodyear buy Cooper Tire & Rubber Co. in a deal worth $2.5 billion without it reaching the rumor mill?

While few specifics of the deal, announced Feb. 22, have been made public, dealers reached by Tire Business were optimistic and expressed well wishes to the company.

"They have been great partners to Tire Discounters over the years, and we look forward to working with them through this transition and beyond," Jamie Ward, president and CEO, Tire Discounters, the eighth largest independent tire dealership in the U.S., said.

Tire Discounters sells both Goodyear and Cooper tires.

The Cincinnati, Ohio-based company has more than 135 retail locations in six states and recently announced intentions to start franchising in 2021.

Frank Kneller, CEO of GB Auto Service, with 181 retail outlets in five states, expressed optimism.

"We are excited about the merger, as it will be focusing on aftermarket tire opportunities," Mr. Kneller said.

The move combines two Ohio-based companies that have been making tires for more than a century.

Richard Kramer, CEO and president of Goodyear, said the transaction is good news for independent tire dealers across North America.

"Dealers should feel good about it, and supply and service ought to be something that improves," he said to members of the tire trade press Feb. 22.

BTS Tire & Wheel distributors and Blacks Tire Service Inc. (BTS) have been Goodyear and Cooper dealers for more than 70 years, Rick Benton II, vice president of BTS Tire, said.

"I think this will have a positive impact for the tire industry as it will create synergies between two similar companies at Goodyear and Cooper," he said. "Both being close together in Ohio, I am sure there will be considerable efficiency from corporate strategies all the way to the engineering and production side."

Whiteville, N.C.-based BTS operates more than 50 locations across North and South Carolina. Mr. Benton said it is exciting to see two large American companies coming together and open up possibilities for greater innovation and improvement in quality.

Many dealers noted that they expect little impact to their own businesses, alluding to an adage that most customers want the best quality they can afford. Brand allegiance rarely plays a part.

"We were surprised like everyone else," Chris Mitsos, vice president of Mountain View Tire & Service Inc., said. "Usually you hear rumors of stuff, and this and that, but it was pretty quiet."

Mountain View Tire, with 31 locations throughout the greater Los Angeles metro area, has sold Goodyear tires for 34 years, Cooper for about 11 years.

"We love both companies, we do well with both companies," he said. "We will continue to do business with both companies, and we will treat them as separate vendors, which they wanted to be treated as separate vendors for the time being.

"My hope is the Cooper brand, by and large, can survive this," Mr. Mitsos said. "I am hoping they use Cooper's portfolio to improve their own portfolio."

He pointed to Cooper value brand Starfire Tires as "an opening price point brand that Goodyear doesn't have."

Larry Sutton, president of RNR Tire Express, said while it's interesting news to follow, he doubts it will have much impact on tire dealers. The fast growing rent-to-own franchisor, with a network of more than 140 retail locations in 24 states, sells both Goodyear and Cooper.

"The old standard is 'if it's not broke, don't fix it,'" Mr. Sutton said. "Most likely, not that much will change."