STOW, Ohio (June 21, 2000) — The proud name of Dick Cepek, long synonymous with off-road adventures, soon will be a part of that landscape again.
Following the recent liquidation of the bankrupt specialty tire and accessories marketer, a competitor—itself known as an innovator in that niche—has stepped in to acquire Dick Cepek Inc.´s assets and resurrect its well-known product lines.
At a May 31 auction of West Coast-based Cepek´s holdings, privately held Max-Trac Tire Co. Inc.—which does business out of Stow, Ohio, as Mickey Thompson Performance Tires & Wheels (M/T)—beat out two other companies to proffer the winning bid of $1.6 million.
Cepek had filed for Chapter 11 bankruptcy protection on March 11, 1999, in U.S. District Court, Central District of California, Los Angeles Division. However, after months of unsuccessfully trying to find a buyer for the 42-year-old company, the court ordered the case converted to a Chapter 7 liquidation on Feb. 14.
As part of the deal, M/T incurred none of Cepek´s debt while acquiring the Cepek name, its tire molds, vehicle suspension and lighting divisions. It also got all inventory left in Cepek´s 11 retail stores and in its former Beaumont, Calif., headquarters and warehouse.
Because the retail stores were leased, they were not included in the purchase and can now be sold separately.
Mickey Thompson President Lee McMannis told Tire Business he was not interested in buying any stores. Rather, his objective is to move the company—named after motor sports racing great Mickey Thompson—"to the forefront of aftermarket specialty supply with a complete product line and continue the off-road traditions of both companies."
Whether or not M/T will keep intact all of Cepek´s lines has not yet been determined. It is currently selling off all non-Cepek products.
"We´re in the process of reviewing all Cepek-brand product lines," Mr. McMannis said, "with the hope and intention that we´ll bring them into the marketplace as soon as possible. We´re also looking at how we´ll differentiate between Cepek and M/T products."
On June 1, Mickey Thompson opened the doors to a new warehouse and office complex it acquired in Temecula, Calif., after consolidating operations from a leased warehouse in Compton and its West Coast sales office in San Juan, Calif., said Roger Simmons, M/T advertising promotional manager. But with so much yet to be determined as the company absorbs the Cepek organization, Mr. McMannis was not sure where the new Dick Cepek Division will call home.
M/T, he added, is now positioned to increase product availability and service to its and Cepek´s West Coast customers.
Before it closed down, the majority of Cepek´s tires were being manufactured by Denman Tire Corp. in Leavittsburg, Ohio, along with some from Cooper Tire & Rubber Co. and Specialty Tires of America Inc. (STA).
But prior to the Cepek acquisition, a Denman executive told Tire Business that the company no longer had capacity to produce any tires for Cepek. So once production restarts for the Cepek lines, Mr. McMannis said they will be made by STA and Cooper.
Both he and Mr. Simmons called the acquisition "a perfect fit" for Mickey Thompson, which has made a name for itself internationally as a private brand marketer of specialty products including wheels and bias-ply tires for 4x4, light truck and sport-utility vehicles. Through Cepek, it will get a number of tire sizes M/T didn´t have, as well as a radial tire program.
Mickey Thompson also focuses on straight-line racing with products destined for drag and land speed racing, as well as for hot rods. It recently expanded into U.S. Formula 3 and S.C.C.A. racing as the exclusive importer of Avon racing tires for North America.
Since its founding in 1963, M/T´s history has included many innovations and firsts: The company introduced the industry´s first 70-series tire in 1966, the first 60-series tire three years later, the first raised white letter tire in 1970, and the first 50-series line in 1971. It also debuted, in 1977, the first on/off road tire with tread on the sidewall and, in 1994, began offering DOT-approved 17-inch off-road racing tires and wheels.
Along with Cepek´s wide-ranging line of tires and accessories, M/T gains a suspension program encompassing lift kit packages for an extensive array of sport-utility and off-road vehicles.
"It´s cutting-edge technology and the quality, we believe, is second to none," Mr. McMannis said. Because of proprietary restrictions, he would not divulge what manufacturers are supplying suspension parts.
Ironically, it was that suspension program, in part, that led to Cepek´s downfall.
About three years ago, the company introduced the system during the annual Automotive Aftermarket Industry Week (AAIW) shows in Las Vegas. But as it lapsed into a negative cash flow situation, Cepek apparently found itself unable to pay bills to suppliers, including those providing parts for the suspension kits. Consequently, many of them then couldn´t be shipped.
Bill O´Roake, who was executive vice president of sales and marketing when Cepek shut its doors, now is onboard with Mickey Thompson. In an M/T press release announcing the acquisition, he referred to "the woes created" when the high-tech suspension system "was inadequately marketed," then noted: "We are looking forward to the opportunity provided by Mickey Thompson to bring the proprietary Cepek suspension system to market for our customers.
"It is the easiest suspension kit to install on the market, with unique technology."
Mr. McMannis said there are "a lot of things" his company needs to address in order to get the suspension program up and running before the AAIW shows this fall, including "getting proper inventory, seeing what can be shipped and what needs to be ordered."
M/T is hoping to remedy that situation "fairly quickly," Mr. Simmons said. At the AAIW, the company is planning to have a 30x90-ft. booth showcasing the expanded Mickey Thompson and Cepek product lines.
After the smoke clears and M/T digests its purchase, Mr. McMannis said one goal is to grow the Cepek operation. But first, "the primary product lines need to be distributed. After that, we´ll just put it into our traditional high level of supply, customer service and promotion that we do and have done for years."
The low-key Mr. McMannis joined M/T in 1964—a year after it was started in Stow by Mickey Thompson and Mr. McMannis´ father, Gene, who at the time was head of tire design research at Goodyear.
"Goodyear made a number of tires for Mickey, including for his landspeed record runs," Mr. McMannis recalled. "Mickey convinced my dad to leave Goodyear and start the company with him.
"The first (Mickey Thompson) products actually were racing slicks made by Cooper."
A competitor par excellence, Mr. Thompson participated in almost every form of motor sports, including drag racing, boats, road courses and the Indianapolis 500. In off-road racing, he drove for a short time for racing legend Parnelli Jones before deciding to design and build his own off-road vehicles.
He set more than 500 national and international speed records including one in 1960 that stood for 30 years before being broken.
Tragically, Mr. Thompson, 59, and his wife, Trudy, 41, were murdered in their driveway March 16, 1988, as they were leaving for work from their home in the exclusive community of Bradbury, Calif., near Pasadena.
Since that time, a reward of $1 million has been offered for information leading to the arrest and conviction of the individuals responsible for the crime. Witnesses indicated to police that possibly two suspects fled the scene on 10-speed bicycles after the murders.
The case has been featured several times on the TV show "America´s Most Wanted."