TBC posts record earnings for qtr. MEMPHIS, Tenn.—Buoyed by an 8.9-percent increase in tire unit shipments, TBC Corp. posted record earnings for the first quarter of 2000, ended March 31.
Net earnings for the three months rose 3.7 percent, compared with the 1999 quarter, to $3.95 million, on a 9.4-percent jump in net sales to $177.4 million.
The gain in unit shipments of tires was well above the average for the industry as a whole, said Larry Day, TBC president and CEO. Mr. Day attributed the increase to new product introductions and other marketing initiatives, including new premium touring tires with 100,000-mile warranties and a completely new line-up for the company's Sigma brand.
TBC should benefit from some industrywide price increases, scheduled to take effect at mid-year, Mr. Day said, and also is benefiting from its investment in Carroll's Inc., a large wholesale distributor that TBC acquired in 1998. Since then, Carroll's has added four new distribution centers and increased both its penetration of existing markets as well as its geographical coverage of the Southeast, he said.
TBC will continue to expand its Big O Tires Inc. retail operation, as well, Mr. Day said. Big O finished 1999 with a total of 454 stores, he said, and should have a net gain of 20 to 25 locations this year.
Bandag's 1st-qtr. results unchanged
MUSCATINE, Iowa—Bandag Inc.'s results for the first quarter of 2000 were virtually unchanged from a year ago, as a slight increase in net sales was more than offset by an increase in income taxes, resulting in a slight decrease in net income.
For the three months ended March 31, Bandag posted net income of $10 million, down 0.2 percent from the 1999 quarter. Net sales crept up 0.1 percent to $224.3 million, as a 4-percent decrease in tread rubber sales was overcome by higher sales in the company's Tire Distribution Systems Inc. (TDS) subsidiary.
The company said most of the decrease in tread rubber sales occurred in North America, where some dealers left Bandag for other retread suppliers.
Within the TDS distribution subsidiary, the 6.1-percent increase in net sales, to $89.8 million, was due almost entirely to acquisitions, the company said. However, an 18.4-percent jump in operating expenses pushed the unit further into the red, as its operating loss increased to $2.89 million from $1.9 million a year ago.
Bandag Chairman and CEO Martin G. Carver maintained the company is well-positioned for the future through "our vision for serving fleet customers through a `Strategic Alliance' with our Bandag dealers."
Prototype wheel has layer of rubber
NASHVILLE, Tenn.—Bridgestone Corp. and Tokyo-based Topy Industries Ltd. have announced the development of a prototype wheel for automobiles that contains a layer of rubber between the rim and the disk, which secures the wheel to the hub.
Bridgestone, the parent company of Bridgestone/Firestone Inc. and Bridgestone/Firestone Europe, said the new wheel design will provide a quieter, more comfortable ride and improved vehicle handling.
This special rubber layer reduces the amount of vibration and the tug on steering encountered as the wheel rolls over ruts and other imperfections in the pavement, Bridgestone said. On conventional wheels, the rim and disk are welded together, and noise and vibration are transmitted more directly from the wheel to the body of the auto.
Bridgestone said another possible application for the new wheel is with low rolling resistance tires.The two firms said they will continue to work together to develop a commercial version of the wheel and will explore other tire-wheel systems to enhance performance.
NHTSA proposes recall, safety rules
WASHINGTON—Tire manufacturers are mulling their response to legislation proposed by the National Highway Traffic Safety Administration that would tighten tire recall and other motor vehicle safety requirements.
Among other things, the NHTSA bill would extend tire makers' obligation to recall defective products to five years after the date of manufacture from the current three.
One section of the bill would require all auto, tire and parts manufacturers to test their products or perform engineering analyses before they could certify them as meeting NHTSA standards. Currently, all makers may certify compliance without testing, the agency noted. NHTSA would require manufacturers to maintain records on all tests and analyses.
Another section would raise maximum penalties for violating federal motor vehicle safety standards to $5,000 for each violation, up to a ceiling of $4 million for a series of related violations. The current limit is $1,000 per violation and $800,000 tops for a series of violations.