Following a lackluster 1993 in which it posted a net loss of $22.9 million, General Tire prepped itself for a year of change. The company's German-based parent, Continental A.G., started things off in January announcing it would continue to restructure the U.S. tire maker as well as foster a more cooperative atmosphere between the two firms.
``The emphasis is on exchange between the two worlds of Continental and not dominance of one culture over another,'' Conti Chairman Hurbertus von Grunberg told General dealers.
Early on, General also mutually terminated its marketing agreement to make Big O brand tires for Englewood, Colo.-based Big O Tires Inc. The move finalized the break in the Big O-General supply relationship that began fracturing in 1992 over Big O's concerns about product quality.
But the biggest change occurred in November when General announced it would relocate its headquarters from Akron to Charlotte, N.C., by the end of 1995. That move will bring the company closer to its Charlotte passenger tire plant, reduce long-term costs and generate ``a new corporate culture consistent with our size and strategy,'' said Alan Ockene, then-General president and CEO.
A short while later, Mr. Ockene announced he would retire at the end of 1994, in part, because he didn't wish to move from the Akron area.
In his place stepped 54-year-old Bernd Frangenberg, executive vice president of General's passenger/light truck division. Mr. Frangenberg joined the U.S. tire maker Jan. 1, 1993, when he was appointed head of General's passenger/light truck division after serv-ing Continental as vice president in charge of original equipment.
When Mr. Frangenberg joined General last year, other company executives were on their way out in order to, as Mr. Ockene put it, ``flatten the organization.'' Horst K. Mehlfeldt, former senior vice president and chief financial officer, John D. Kelley Jr., former vice president, corporate quality and international technology, and John Henry Davis, former vice president and general counsel, resigned Jan. 1, 1994.
But the company's personnel moves affected all levels of employment throughout the year. General eliminated about 100 administrative and clerical positions and, separately, cut 70 information systems workers who were to be hired by a subcontractor, Integrated Systems Solutions Corp.
In October, General opened its new $7.5 million Commercial Division Tire Technology Center in Mount Vernon, Ill. The center is home to more than 30 tire engineers, chemists and equipment design personnel who will develop radial highway truck tires.
The year also marked a change in marketing strategy as General unveiled some of its first television advertisements to tout Continental brand tires during the Professional Bowlers Association tour. Those ads marked the first step of General's new multi-brand marketing approach as well as its cooperative effort with Conti. General later announced it would begin molding the words ``Continental Technology'' on the restyled sidewalls of its entire line of General brand radial medium truck tires.
The bottom-line effects of 1994's changes were unclear at presstime, but Continental said it expected General to post a ``slight'' year-end loss, primarily due to costs associated with ``necessary restructuring measures.'' General was at a break-even point through the first three quarters of 1994 while sales increased slightly.