CLEVELAND—Titan Wheel International Inc. continues to live up to its leviathan name, swallowing up failing companies while, in the process, adding titles to its president's curriculum vitae. On May 14, one day after struggling Hamden, Conn.-based Condere Corp. filed for Chapter 11 bankruptcy protection, Titan Wheel's subsidiary, Titan Tire Corp., acquired a 19-percent stake—almost 900,000 shares—in Condere.
As Condere CEO Dennis Terwilliger stepped down, its board elected Titan Wheel's flamboyant president and CEO, Maurice ``Morry'' Taylor Jr., to the posts of chairman, CEO and president of Condere, at an annual salary of $1.
According to a Titan press release, Condere incurred more than $8 million in losses in 1996 on sales of $120 million. Among its holdings are Fidelity Tire Manufacturing Co., TTS Corp. truck tire emergency service, and three ServisFleet commercial tire outlets.
The bankruptcy has thrown Natchez, Miss.-based Fidelity into turmoil, forcing it to halt production. But it also is paving the way for Mr. Taylor to rescue—and redefine—the truck tire plant, converting it to production of what Titan is calling its revolutionary new Grizz LSW off-highway tire/wheel concept.
This low-profile concept was introduced a few weeks ago and is scheduled to begin rolling off the line in late June. (See TIRE BUSINESS, May 12.)
Titan Wheel is a global maker of mounted tire and wheel systems for off-highway equipment used in agriculture, construction, mining, military, recreation and grounds care. It has manufacturing and distribution facilities throughout the U.S. and Europe.
The company also recently announced its intention to repurchase up to 5 million of its shares to increase shareholder value.
It is Mr. Taylor's intent ``to try and turn around'' Fidelity, and his unvarnished assessment that, for at least eight years, the company has been making the wrong product: radial truck tires. ``They've got to get out of that and into something that they at least can make some money on,'' he said.
Still energized from his Condere appointment, the self-made millionaire jetted into downtown Cleveland May 16, commanding an expansive press conference for the tire trade press fittingly held in a room in the hangar of Million Air Flight Service.
Though the meeting had been arranged to spotlight the Grizz LSW, Mr. Taylor—wearing a dark blue power tie with white stars and a grizzly bear peering over an American flag—also discussed his plans for Fidelity as well as his distinctive opinions on subjects far and wide.
Point blank, for example, he predicted that ``within 18 months I see Titan owned by somebody a lot bigger than us.
``One of the Big Three tire makers either will have to exit the (OTR) business, or buy us....''
The man who likes to refer to himself as ``The Big Dog'' and ``The Grizz,'' stated that Condere's board brought him in because he has a proven track record of turning around losing companies.
It will be a daunting challenge because the company is riddled with problems, including an upper management that Mr. Taylor, in his characteristic shoot-from-the-lip style, called ``goofy.'' The next 60 days will be real tough, he said. If Condere can't be saved within that period, ``it will be liquidated.''
But first, rather than send in subordinates, he said he'll personally negotiate workplace changes at Fidelity with the United Steelworkers of America, which represents the factory's 500 hourly employees.
Despite rumors, he said he won't ``lop off heads.... I'm not going to cut their pay'' or restructure wages. ``They just have to work eight hours (a day). That's all I'm asking.''
A hands-on manager—right down to fixing plant machinery himself—the 52-year-old executive said, ``At Natchez, I have to go in, and they have to realize: Here's the big dog. I can sweat and work like they do....
``Our philosophy is, if you're paying someone an hourly wage—a maintenance guy, for instance—and he gets his job done and still has time left, is it beneath him to do something else to fill the time? Like pick up a broom, or paint machinery or something?
``That's the problem you have in these facilities. What's wrong with working a full eight hours for an honest day's wages? That's what we have to change.''
Though Fidelity's production has stopped, salaried employees are finishing off some ``perishable inventory,'' he said. ``But the union is complaining about management operating the plant. The company went bankrupt and the only thing these jerks can think of to do is file grievances.
``I told the union: Write all the grievances you want. Don't give them to me. Hand them to the guy in the black robes. Once there's a bankruptcy, by law, it's in the judge's hands.''
Still, Mr. Taylor said he doesn't expect trouble from the union ``because I've got a plan.''
Comparing himself to an emergency room doctor, he views failing companies like ``someone who comes in all banged up, in bad shape. The doctor may have to amputate a leg, but if all goes well, the patient survives.... My job is to put that patient back together; let him walk out alive.''
Fidelity's inability to sell radial truck tires at the same prices as does Goodyear, Michelin North America or Bridgestone/Firestone Inc. (BFS) is largely why Mr. Taylor will drop that production. That has already upset the tire maker's customers, he admitted.
``They've beat down Fidelity's prices,'' he charged, "then used that against other tire makers. When I told them radial truck tires are Fidelity's biggest loser, they cried that their tire prices will go up.
``I said, `You're the ones who've been going around bankrupting companies. That's too bad, but you're out of luck.'''
If ``surgery'' on Fidelity is successful, it will begin producing some of the Grizz LSW package, which Mr. Taylor plans to license to other tire makers. Goodyear, Michelin and BFS have shown interest in it, he said.
Titan's takeover of Fidelity comes at the expense of Galaxy Tire Inc., which had been Condere's largest shareholder.
Consequently, Galaxy pulled its molds from Fidelity's plant, which made Galaxy's bias OTR and specialty tires and contributed to about 14 percent of Galaxy's annual sales of $70 million.
According to Mr. Taylor, Galaxy sold a block of its Condere stock recently, but still owns a piece of the company. And he said the only objection he's had to taking over operation of Condere is from Galaxy's owners, the Ganz family.