MADERA, Calif.—Schoettler Tire Inc. credits expansion into the San Francisco bay area for its recent sales growth but worries how the California energy crisis might affect its future.
"There are very uncertain business conditions here," said David Schoettler, the dealership's secretary and treasurer.
"It's a little scary. And it's tough like that for everybody."
At $36.5 million, Schoettler Tire's sales were up 20 percent in 2000 over 1999. Mr. Schoettler said the company's profit margins are decreasing as natural gas prices continue to rise.
"Gas prices in our retread shops have doubled," he said. "How are you going to pass that on in a competitive situation?"
The company was more aggressive at the start of the year than it is now, Mr. Schoettler said. Plans to open two outlets this year have been changed to just one instead.
However, Schoettler Tire's decision to switch its retreading system supplier to Michelin Retread Technologies Inc. from Bandag Inc. last year was a good one, Mr. Schoettler said.
That move gave the dealership a chance to become the only MRTI shop in northern California, he said.
"We're quite satisfied with it," he said. "We feel like it produces an excellent product."
While retreading accounts for a mere 8 percent of Schoettler Tire's revenues, the company derived 62 percent of its sales from its commercial division. Half of those sales are from fleet accounts. Schoettler Tire has 12 company-owned commercial outlets, including the retread plant.