PHILADELPHIA (Dec. 14, 2001)—Automotive service chain Pep Boys—Manny, Moe & Jack is shifting nearly 100 percent of its private brand tire business to Cooper Tire & Rubber Co., which currently makes about 60 percent of the firm's tires.
The deal will mean the loss of about $100 million in business for Bridgestone/Firestone, which makes Pep Boys' Futura brand along with Cooper, according to Tire Business research.
"Cooper has been an excellent supplier, both in terms of product quality and sales support, and has earned our respect and trust,” said Don L. Casey, senior vice president-merchandising. “Going forward, this is clearly a 'win-win' situation for both companies.”
The sale of Cornell and Futura brand tires represents 17 percent of Pep Boys revenues, or $333 million in fiscal 2000. Pep Boys operates more than 620 stores in 37 U.S. states and Puerto Rico.
The deal will allow Cooper to enhance its capacity utilization, Mr. Casey said, thereby improving Pep Boys' cost structure.
Cooper said it expects its relationship with Pep Boys to become “even stronger,” according to Mark F. Armstrong, president of Cooper's North American Tire Division.