AKRON-TBC Corp., the nation's largest private-brand tire distributor, and Kelly-Springfield Tire Co. have inked a long-term contract in which the two firms pledge to work closely together for their mutual benefit. The 10-year agreement is aimed at keeping both companies abreast of issues affecting the North American tire market, according to Marvin Bruce, chairman of Memphis, Tenn.-based TBC.
As part of the agreement, the firms will work to improve the flow of tire technology, explore joint concerns of warehousing and distribution and streamline production schedules, the companies said.
The goal is to improve efficiencies at both companies and provide better service to the customer, Mr. Bruce said.
The TBC chairman and Kelly President Lee Fiedler jointly announced the agreement at a press conference in Akron, March 21.
``From the tire manufacturer's point of view, our commitment to the private-brand tire business is strongly reinforced by establishing the framework for continued growth with our largest customer,'' Mr. Fiedler said. TBC represents about 20 percent of Kelly's business, he added.
Kelly will assign a tire engineer to work exclusively with TBC's purchasing and engineering group to assure TBC and its nationwide distributors remain at the cutting edge of technology, the firms said.
``We plan to establish the right environment to foster dialogue aimed at implementing mutually beneficial cost-saving programs,'' Mr. Fiedler said. ``This is vital in order for Kelly-Springfield and TBC to compete effectively in today's replacement tire market. Organizations must be cost-efficient in all areas of their business.''
The two firms have had a strategic partnership since 1963, when Kelly began making tires for TBC.
Kelly produces Cordovan, Multi-Mile and Sigma passenger and light truck tires, and Sigma, Power King and Multi-Mile medium truck tires for TBC.
Cooper Tire & Rubber Co., in Findlay, Ohio, Fidelity Tire Manufacturing Co. in Natchez, Miss., and Hankook Tire Manufacturing Co. Ltd. in South Korea also supply tires to TBC.
The new agreement means TBC's customers can be assured of on-going supplies of state-of-the-art products from Kelly as they move into the 21st century, said Mr. Bruce, who called the pact more than an ``agreement.''
``It's a pledge to each other to ensure that our companies will continue to be leaders in their respective environments,'' he said.
The agreement states Kelly will remain TBC's leading supplier but contains no quotas on tire purchases, Mr. Fiedler said.