VALENCIA, Calif.—With little, if any, fanfare, three of China's larger tire manufacturers have established a $100 million import and distribution company in this Southern California port. Led by Shanghai Tyre & Rubber Co. Ltd., the three tire companies joined forces last year to form China Manufacturers Alliance L.L.C. (CMA) to handle the importing and wholesaling of their respective brands, including Double Coin, Wynstar, Dynastar, Forward, Armour, Advance and Triangle.
CMA also coordinates custom brand contracts with the Chinese manufacturers, CMA Chief Executive Officer Jeff Kreitzman said. This type of business represents about one-fourth of the company's sales now, and could reach 40 percent or more by next year, based on several contracts starting up, he said.
To get established quickly, CMA last August bought most of the assets of importer/wholesaler Dynastar International of Santa Clarita, Calif., which had handled the importation of several Chinese brands since the early 1990s.
The Chinese companies made the change in order to have more direct influence over their business in North America, Mr. Kreitzman said.
Mr. Kreitzman, formerly president of Dynastar, and tire import-export veteran Wayne Hung, CMA's president, head up its management team, as well as owning shares of the company.
CMA forecast sales of $100 million for its first full year of operation and 10- to 20-percent annual growth in the coming few years.
The bulk of the company's business is in commercial tires—truck, intermodal, industrial, skid-steer etc. But the alliance's capacities for passenger and light truck tires are growing, Mr. Kreitzman said, providing opportunities for dealers or dealer groups to consider their own proprietary brand.
CMA did not specify a minimum order for custom brands, saying each possible contract would be negotiated on its own merits.
Mr. Kreitzman declined to identify any of the firm's custom brand customers.
Besides Shanghai Tyre, CMA's partners are Guizhou Tyres Co. Ltd. and Xuzhou Tyre Co. Ltd. Originally, Shandong Triangle Rubber Co. was part of CMA, but it withdrew before year-end, Mr. Kreitzman said, though CMA continues to distribute its Triangle brand.
Together, these three tire makers report about $700 million in sales worldwide, according to Tire Business' Global Tire Report.
Most of CMA's business is handled on a container basis, although it maintains a warehouse in Memphis, Tenn., to handle some distribution.
For now, CMA's primary target markets are the U.S., Canada, Mexico and the Caribbean, Mr. Kreitzman said. Central America is included in the firm's market area, but CMA still sees its potential as a few years down the road.
CMA also has salesmen active in Europe, doing business on a container-load basis in order to avoid the need for warehousing.