ENGLEWOOD, Colo.-General Tire and Big O Tires Inc. have mutually terminated a marketing agreement for General to manufacture Big O brand tires. The agreement, inked last May and to be renewed annually, was annulled in January due to ``policy differences,'' a Big O spokeswoman said. The companies would not elaborate.
The agreement had laid out details of orders and warranties for Big O brand tires made by General, the spokeswoman said.
Production will be picked up by Big O's other supplier, Kelly-Springfield Tire Co., she added.
General, however, will continue to produce the Sonic line of private brand tires for Tire Marketers Associates, a division of Big O based in Clearwater, Fla., that supplies tires to distributors primarily in the eastern U.S.
The termination of the agreement finalizes the break in the Big O-General supply relationship that began fracturing more than a year ago over Big O's concerns about product quality.
The Englewood-based company has been progressively moving away from its reliance on General, once an 11-percent owner in the tire franchiser, so the latest development was no surprise to industry analysts.
The loss of the Big O account is a ``big blow'' to General, according to analyst Donald DeScenza of DeScenza & Co. in New Canaan, Conn.
Last May, Big O severed its 15-year supply agreement with General and repurchased 400,000 shares of its stock from General.
About that same time, Big O signed a major supply agreement with Michelin Americas Small Tires to direct ship Uniroyal, Riken, BFGoodrich and Michelin brand tires to its more than 370 company and franchised stores nationwide.
The franchised stores still will carry some General brand lines, according to the Big O spokeswoman said.
Tire Business for 1994