NASHVILLE, Tenn.—Marangoni S.p.A. will invest $10 million in the coming year to build a RINGtread pressing plant and warehouse in the U.S., underscoring its commitment to establishing a North American retreading network. The company, through its Marangoni Tread North America Inc. subsidiary, also has two new RINGtread system (RTS) franchisees in the U.S. ready to start production. RINGtread is Marangoni's circular precured tread rubber, which is mated with the prepared casing in a proprietary process.
A to Z Tire & Battery Inc., a 25-outlet retail and commercial dealership based in Amarillo, Texas, recently started production of RTS retreads at a plant in San Antonio.
The company also has signed up a third U.S. franchisee—an as-yet unidentified retreader in the Southeast—putting the firm on track for its target of 20 retread franchisees by the end of 2000, said Jack Woodland, president of the U.S. subsidiary, during the recent International Tire and Rubber Association Expo in Nashville.
The first Marangoni RTS retread plant in the U.S., at Ray Carr Tires Inc. in Harrisonburg, Va., opened earlier this year. RTS Ring Tread System Inc. in Montreal was the first North American RTS franchisee, starting production in 1996.
Marangoni has two sites still under consideration for its new tread pressing plant: one in Alabama and one in Georgia. Company officials declined to specify the plant's size or capacity, but said manufacturing will start the second half of 2000.
The facility's warehouse will be in operation first, allowing Marangoni Tread to service its dealers more efficiently with circle treads imported from Italy, Mr. Woodland said.
The third phase of the project, in mid to late 2001, will be the addition of mixing capacity at the tread plant, Mr. Woodland said. This not only will facilitate improved ring tread production, he added, but also will put Marangoni Tread in a position to supply its franchisees with strip rubber for mold-cure production, should they so choose, or to evaluate whether to offer other Marangoni precured products, like the arced-surface WINGtread.
That eventuality also could open up possibilities for Marangoni's machinery division to get more involved in North America, Mr. Woodland said.
Marangoni's newest partner, A to Z Tire, used to retread passenger and light truck tires, but got out of business in the mid-1970s, said President Phil Nussbaum, who said he decided to consider commercial tire retreading after realizing the company's outside purchases of retreads had reached a point where it made sense to bring it in-house.
Commercial tire sales made up approximately one-fourth of A to Z's $50 million in sales in 1997.
Production started in May at a converted warehouse in San Antonio, and is going well enough that Mr. Nussbaum said he sees expansion as likely.
A to Z Tire chose Marangoni RTS for several reasons, Mr. Nussbaum said.
``There are some major retread wars and politics going on, and we don't want to be involved in that,'' he said.
``Marangoni's process is fairly unique. I think it's the best system—it's the retread system of the future,'' he added. ``With Marangoni, we can make a superior product and not enter the fray of price-cutting.''
Nearly all of A to Z's locations are combination commercial and retail, according to company data.
Larry Wingert of the Tire Business staff also contributed to this report.