HILTON HEAD, S.C.—It's one thing to develop new and innovative tires and wheels. It's another for them to be practical in the market place. Continental General Tire, looking to avoid potential ``real world'' problems as it develops and introduces new tire and wheel concepts, has formed a dealer group called the Continental Technical Club.
The idea is to involve tire dealers early on in the development cycle and solicit their opinions on how such innovations might impact their operations, said Chris Dickson, vice president of sales and marketing for CGT's replacement passenger and light truck tire group.
Last fall, the club met for the first time. Two groups of about 15 dealers each spent two days at Conti General's Uvalde, Texas, test track learning about some of the company's new technology and discussing issues such as tread design.
``We want this group to work with us to identify what it means to the independent tire dealer,'' Mr. Dickson said. None of this technology can be introduced if it can't be commercialized in the replacement market, he added.
In a wide-ranging interview during the Clemson Tire Conference in Hilton Head in early March, Mr. Dickson also revealed plans for a new range of light truck tires as well as expanding the company's dealer base west of the Mississippi River.
``We're making a real effort to get our share in that part of the market,'' he said.
The company also will unveil a new buying concept for dealers this year, he said.
CGT and its German parent, Continental A.G., recently announced several new tire concepts, which are in various stages of development.
Two of these are run-flat designs, while the third is a corporate effort to re-define the role of the tire, making it a vehicle systems component.
This last technology would, in effect, create an intelligent tire, Mr. Dickson said. The Conti Sidewall Torsion Sensor System involves magnetizing the tire's sidewalls and using vehicle-mounted sensors to gather information, which would be transmitted to a control system on the vehicle and passed on to the driver.
Of the two run-flat tire concepts bthe companies are testing, one fits standard tires and wheels; the other requires a unique rim.
The ContiSafetyRing uses a light-weight metallic insert mounted inside a normal tire that supports it in the event of air loss. This concept differs from the ContiWheelSystem, which employs new tire and wheel designs and does away with the tire bead and apex construction.
Conti, the world's fourth-largest tire maker, realizes it probably can't catch the top three, which are much larger in size, Mr. Dickson said. So the company aims to be a leader in a different way—a leader in developing automotive systems.
More than sales volume, Mr. Dickson believes the value a company is able to provide customers will drive the market in the future.
``To give value, we need to look at what are the needs of our customers and how we can best answer those needs,'' he said.
The Continental Technical Club is one way the company is keeping abreast of customers' needs.
``My belief is that some technological innovations in our industry have not been successful because we have not paid attention to how they're integrated into the re-supply chain,'' he said.
Through the tech club, Mr. Dickson said, CGT wants to answer such questions as: What retail advantages can dealers glean from its new, innovative products? Are there other things dealers could do with the products that would enhance them even further? What are the technical issues faced in mounting and demounting these tires? What happens if somebody vandalizes the sensors?
In establishing the Conti Tech Club, CGT doesn't necessarily want dealership principals. Instead, it has its eye on younger, junior management people, whose feedback Mr. Dickson called ``far more visionary.''
Also this year, CGT will begin working on a new light truck tire line—an area ``we have neglected for 10 years now,'' Mr. Dickson said.
CGT learned from dealers that they need a range of light truck tires to address various types of light truck owners and uses: tuner, sophisticate, utility, off-the-road and snow.
Working in cooperation with Conti's tech center in Europe, the company plans to introduce these lines in both Continental- and General-brand versions.
Mr. Dickson expects the first of these new LT tires to be available early in 2000.
Another new development for 1999 is the Powerline program, aimed at the ``profit segment'' of a retailer's business.
Simple in concept, Powerline will provide larger retailers with a single tire line, from broadline to performance, under one brand name—General, Continental or a private label.
Depending on the dealership, the Powerline could consist of as many as 52 sizes ranging from 175/75R13 through 55-series 16-inch versions, for example, Mr. Dickson said.
Powerline simplifies a dealer's inventory by providing a single line covering the majority of sizes, eliminating the need to stock a variety of brands. Traditionally, CGT has offered lines in only 11 or 12 sizes that covered 80 percent of the market.
All the dealer wants to do is sell tires, Mr. Dickson said. ``He wants to be happy about the tire, wants to give the best service and wants to have the best margins. To do that, why would I need to stock 800 variations of it, because that's just added money.''
Conti General currently is talking to retailers with sufficient buying power about this new program and expects the first Powerline dealership to begin receiving tires in April.