Tire industry M&A deals keep coming so far in 2024

Strong M&A activity in 2022 continued throughout 2023, and this year has been no different. Top independent tire retail dealers, such as Discount Tire/America's Tire and Sun Auto Tire & Service Inc., grew their footprints, while newcomers, such as Goodturn Tire & Auto, made a statement via acquisition.

The biggest deals so far this year have come from tire maker Titan International Inc., which acquired Carlstar Group L.L.C. for nearly $300 million, and Hankook & Co. Group, which increased its ownership stake in Hanon Systems to 50% with a $1.3 billion investment.

Discount Tire has grown its footprint in the Chicago market, acquiring the retail tire and automotive maintenance operations of Suburban Tire Auto Repair Centers, comprising six locations. The deal, which closed March 31, expands Discount Tire's footprint in the Chicago metro area to more than 35 locations.

Sun Auto acquired Carrollton Complete Automotive, a single retail location north of Dallas, the company announced March 18. Established in 2011, Carrollton Complete Automotive offers a wide range of automotive services as well as a tire sales at a 14-bay facility.

VIP Tires & Service expanded its footprint throughout New England to a fifth state, acquiring Joe's Tire Shop in Waterbury, Conn. VIP's expansion into Connecticut brings the company's store count to 70 locations across five New England states.

Goodturn, an automotive services platform "focused on tire repair and maintenance services comprised of a network of premier brands," launched following 14 acquisitions in Florida, Michigan and North Carolina this year. Goodturn, in business for three years, has 24 locations representing 10 dealership brands.

Gills Point S Tire, which in 2023 made eight deals for 19 locations spread across the U.S, also has continued to grow so far this year. The Portland, Ore.-based dealership has made three deals for five more tire retail locations.

Gills Point S operates over 60 locations in nine states: Oregon, Idaho, Maine, Michigan, Montana, New Hampshire, New York, Vermont and Massachusetts.

Titan International made the first major acquisition within the tire industry in 2024, acquiring specialty tire, wheel and outdoor equipment manufacturer Carlstar Group. The $296 million cash and stock transaction closed Feb. 29.

The transaction includes three factories in the U.S. (Aiken, S.C.; Jackson, Tenn; and Clinton, Tenn.) and another in China (Meizhou), as well as a dozen distribution centers around the world.

Titan President and CEO Paul Reitz said in a recent earnings statement that the last two months were "exciting" as the integration of Carlstar continues.

"I have been particularly impressed by the enthusiasm I see from everyone at Titan and our new team members that joined us with the acquisition," Reitz said. "One of the key strategic rationales for the acquisition was our expected ability to be a 'one stop shop' for customers by delivering best in class products with a deep portfolio for both aftermarket and OEM channels.

"From top to bottom, our employees understand this vision and are working hard every day to make it happen. We have made a lot of progress integrating Carlstar's operations and are very pleased by the initial feedback we've received from the market on the 'new Titan' and how that benefits our customers."

Hankook increased its ownership stake in Hanon Systems, a Seoul-based producer of automotive thermal- and energy-management solutions for the transportation industry.

On May 3, Hankook announced a deal to acquire a 25% stake in Hanon held by a private-equity firm, along with 12.2% stake represented by new shares to be issued through a capital increase, for a total $1.3 billion.

Combined with its existing stake, Hankook will hold a 50.53% stake in Hanon. The acquisition, which is expected to be completed by year-end, makes Hankook one of the Top 30 companies in South Korea with global assets of $19.1 billion.

Fox Factory Inc., a purveyor of vehicle lift kits and other vehicle modification components, struck a deal to buy Custom Wheel House L.L.C. (CWH), a Santa Fe Springs, Calif.-based parts distributor whose businesses include Tensor Tires and Method Race Wheels. Fox Factory agreed to pay Thompson Street Capital Partners $129.8 million for CWH, whose origins date to 2010 with the founding of Method Race Wheels.

Duluth, Ga.-based Fox Factory called the acquisition "complementary" to its existing upfitting and lift-kit business and said it "further broadens" its product offering in a growing segment of the automotive industry.

• This time last year, GreatWater 60 Auto Care made waves with the most acquisitions, five, of mostly single-location tire dealerships. In total last year, GreatWater made eight deals for 27 locations.

• Pomp's Tire grew its footprint when it acquired Royal Tire and its 20 retail outlets and three retread plants.

• AutoNation Inc. made a $190 million deal for mobile tire repair and service chain RepairSmith Inc.

• The biggest deal of the first quarter was BP North America's $1.3 billion bid for TravelCenters of America and its more then 250 truck stops in 44 states.