Mother Nature giveth, and she-and all-season tires-apparently taketh away. That's a quick, cold, snowy synopsis of the winter tire sales fortunes of several dealerships contacted by Tire Business in several of the nation's snow belts.
As dealers look at the ledger sheets in preparing to order snow tires for next winter, a number of them found that the always unpredictable weather, along with motorists choosing to rely on all-season tires to get them through, made their task all the more difficult.
All-seasons plague Foree Tire's winter tire sales
DENVER-Foree Tire Distributors in Denver has seen snow tire sales fall off dramatically in the past five years, according to Foree President Whitney Thomas. Total sales of the tires in 2003 was 13,103, down 7 percent from 2002's 14,735, he said.
The influx of all-season tires has played a role in the decline of snow tires, Mr. Thomas said, as has better road maintenance in Colorado that has reduced the amount of snow and ice on the roads each winter. But the biggest factor, he said, was the current lack of snow in Colorado winters, amounting to a seven-year drought.
``I wouldn't say it's killing the snow tire market, but it's not allowing it to grow,'' he said. ``The public seems to think it doesn't need to buy snow tires.'' Mr. Thomas added that he couldn't speak for other parts of the U.S., just for the areas covered by Foree-Colorado, Wyoming, and western Nebraska.
Foree's biggest-selling snow tire is the Snow Trakker, made by Goodyear but sold under the Sigma and Multi-Mile private brands. ``Not only does it have a modern tread design, but it's pinned for studs,'' Mr. Thomas said. ``In Colorado, that's a very important factor.'' It also sells Power King private brand snow tires made by Cooper Tire & Rubber Co.
In previous years, Foree based its snow tire orders on a three-to-four-year average of previous sales, but now ``it's exactly what we sold this year,'' Mr. Thomas said. ``Orders are due by early April, so it's a guessing game. No returns are allowed, so you have to be right on.'' There are no consignment sales of snow tires at Foree, he added.
Mr. Thomas' sales pitch to clinch the deal on a set of snow tires is simple, he said. ``Snow tires are made specifically to stop on snow and ice. I ask my customers, `Have you ever seen a car slide off into a ditch when you were on the road? What's the cost of a set of snow tires compared with $3,000 worth of damage to your car?' If your wife and kids are driving, the advantages of snow tires should be obvious.''
Willey's Tire finds `Mom Nature,' all-season tires uncooperative
ISHPEMING, Mich.-Snow tire sales so far this year for Willey's Tire Shop in Michigan's Upper Peninsula are down as people turn more toward all-season tires and Mother Nature is less than cooperative.
President Mark Willey said he sells primarily Republic, Cooper and Goodyear snow tires, with Republic being his strongest seller. But even in the Upper Peninsula, he has to convince tire buyers to go with four snow tires. Many times customers will opt for only two, then shift them around on the vehicle depending on the season. Also, many sport-utility vehicle drivers will opt for an all-season tire that has a more aggressive tread.
Often, Mr. Willey said he'll suggest customers buy at least two winter tires then come back if their vehicle's rear end still slips and slides. But that doesn't always guarantee a return customer.
``We've seen a big reduction in the amount of snow tires that we have sold,'' he told Tire Business. ``Years ago it'd be nothing to sell a couple hundred tires in one size in snow tires.... (Now) you're probably looking at maybe 20 percent of all our business would be snow tires.''
This year's slow sales follow three to four years of down snow tire sales as the winters have not produced a lot of snow early enough, he added.
``It all depends on Mother Nature,'' Mr. Willey said. ``If we get socked with it like in the first part of October, then it gets people to move on (snow tires). If it waits until the middle of December before it gets nasty, then the rest of them think, `Well a couple more months and winter's going to be gone.'''
Mr. Willey, who orders his snow tires in June or July, plans to order only about 500 or so tires since he'll have many left over, especially in the less popular 15-inch sizes. He usually bases next year's orders on the present year's performance.
His terms from his suppliers usually are set up with payments in October, November and December, though he prefers November, December and January.
``If we don't get snow in October, it's pretty hard to be selling them, then your payment is due already,'' Mr. Willey said.
None of his suppliers offers any tires on consignment, although ``it'd be nice if they did.''
Overall, business at the 75-year-old dealership was up in January yet down in February as Christmas debt and taxes pile up on people, he said. Founded in 1929, the business now includes the third generation: Mr. Willey's son Scott, who manages the second outlet, in Marquette, Mich.
Winter tire sales almost double for Northwest dealer group
PORTLAND, Ore.-An unusually strong winter of significant snow accumulation and freezing rain helped Northwest Tire Factory L.L.C.'s member dealers almost double their sales of snow tires.
The Portland-based dealer buying group has sold almost 40,000 winter tires in the Kelly, Cooper, Nokian and Hankook lines this season, according to Dave Simas, chief operating officer. Its top seller was the Kelly Magna Grip, a studless tire that comes with pinholes and can be studded if necessary, he said, noting that Kelly lines comprised half of the company's winter tire sales.
Heavy freezing rain that shut down the city of Portland for two days also increased Northwest Tire Factory's tire chain sales to three times higher than last winter, Mr. Simas said. Most people weren't prepared for the ice storm, which left many scrambling for winter tires.
``Our territories are split between the Rocky Mountain and the Cascade ranges,'' he explained. ``Anybody east of the Cascades or Rockies got a big batch, more than normal. The big difference this year is along the coastal areas of Oregon and Washington, we got the really bad weather, which we normally don't get.''
Customers purchased more studless tires this winter, and sales of 75-series snow tires were much weaker than in years past, he said, while sales of 50-, 60-, 65- and 70-series tires grew.
Describing this past winter as an ``anomaly,'' Mr. Simas said he guesses Northwest Tire Factory will probably order 30,000 to 40,000 snow tire units for next year and aim to sell the same levels as this winter. The group typically tries to phase out the older sizes of SKUs and grow its inventory about 10 percent to accommodate the same growth in its number of stores, he said.
``The problem is this year has two complications: the retail customer...will remember this last year, thinking, `Oh maybe I need to get more prepared.' Our store owners themselves are going to be thinking more about it, plus they've depleted their inventory,'' he said. ``We had a lot of people who sold inventories they've had for three or four years.''
Already, Mr. Simas said he has ordered 16,000 units from Nokian-four times more than what Northwest Tire Factory purchased for this season. He said figuring out how many snow tires to order is nearly impossible.
``I think it's always harder to judge when you have a spike every four or five years,'' he said. ``Normally our terms are based on our previous year's sales. We look at what we've done in the past. So it's always a guess trying to judge which tires after four or five years-if you get a rush-are really diminishing.''