AKRON-Tire manufacturers face a difficult and uncertain future in trying to restore public confidence in their products-one that will require increased commitment on the part of company management and employees alike, said a top tire industry executive in a recent speech.
``Only when we have demonstrated our commitment to a new standard of quality that embraces safety and environmental stewardship will we retain the good will of our customers,'' said H.I. Shin, president and CEO of South Korea-based tire maker Kumho Industrial Co. He made the remarks in a speech at the Tire Society Annual Meeting and Conference in Akron April 24, which coincided with the dedication of a new technical center opened just outside of the city by the tire maker's Kumho Tire U.S.A. Inc. unit.
No stranger to challenges, Mr. Shin told how Kumho has achieved both growth and increased profitability in the midst of a floundering Korean economy. He also stressed the importance of moving forward as an industry-particularly technologically.
``Our global market share is merely 2 percent, but it may surprise you to learn that we are the world's 10th biggest tire manufacturing company in terms of sales and volume,'' Mr. Shin told his Tire Society audience.
``Kumho'' is the Korean word for a very large, placid lake, he said. ``This is the same image we want our customers to have when they use our products-calmness, serenity and security.'' Kumho also was the nickname of the company's late founder, Incheon Park, according to Mr. Shin.
Entering into business at the close of WWII with just two cars, Mr. Park built a passenger transit service that eventually became the largest in South Korea. He ventured into tire manufacturing in 1960 after deciding that the only way to assure his transport service of a consistent supply of tires was to build them in his own factory.
Mr. Shin has been with Kumho since 1965 and was appointed president of the South Korean parent company in 1997 after serving as CEO of subsidiary companies in Britain and the U.S. At the time he assumed the company's presidency, Mr. Shin said, South Korea was suffering the worst economic crisis in its history-and Kumho was experiencing the same financial troubles as most Korean companies.
``In a free and open market, it is the customers who will determine who is providing value, and those companies will be successful,'' he said. ``World-class quality and value has always been my catchphrase for management.''
By the end of 1999, after Mr. Shin had been president for only two years, Kumho had achieved a 30-percent reduction in claims, indicating better customer satisfaction and increased profitability.
Under his leadership, Kumho has continued to forge ahead with technological advancements. The company, which opened its first U.S. technical center in Akron in 1990, moved these operations to a new, $4 million, 20,400-sq.-ft. technical center in Fairlawn, Ohio, just outside of Akron in December. A similar technical center was instituted in Britain in 1997 and another soon will be built in China.
Kumho's goal, Mr. Shin said, is to form a global network for systematic technology.
The company also has found a testing venue for its products by participating in motor sports. Mr. Shin said auto racing provides a ``clear picture of the effects (on tires) of even small changes in design and composition.'' Such involvement recently led to Kumho's selection as the official tire of Formula 3 racing.
The industry's greatest technical challenge, he said, is to continue improving tire quality, handling and noise characteristics without sacrificing traction or treadwear. And manufacturers also must develop the technology to build more energy-efficient tires, he added.
To ensure quality, Mr. Shin emphasized the importance of hiring bright and resourceful people ``who possess vision and a challenging spirit''-and having company management that is willing to focus corporate resources on research.