Within a month of buying wholesale distributor Target Tire Co. of Jacksonville, N.C., American Tire Distributors Inc. (ATD) has joined American Car Care Centers Inc. (ACCC) as a member distributor and assumed most of Target Tire's former territory.
With the deal announced Sept. 27, ATD will distribute to ACCC dealers in North and South Carolina, Georgia and southeastern Tennessee as the marketing group's 19th member distributor. Alliance, Ohio-based Terry's Tire Town will handle ACCC's market in Virginia, and the distributor already plans to buy or lease a warehouse within 30 to 60 days in the Richmond, Va., area. Terry's Tire Town and Ampac Tire Distributors Inc. had covered the territory in the interim.
ATD finalized a deal Sept. 3 to buy Target Tire, which operated 11 warehouses serving about 1,800 customers in five states plus portions of others. The deal gives ATD a total of 80 warehouses. Terms of the deal were not disclosed.
Len Lewin, president of Memphis-based ACCC, said in the short term the arrangement with ATD would give ACCC dealers a seamless transition since many Target Tire employees continue in the same functions.
``The name on the building changes but basically the interfaces and so on remain the same,'' he said.
While the arrangement as it stands now covers only the markets formerly served by Target Tire, both companies left open the possibility for expansions.
``ATD has got growth plans, and so do we,'' Mr. Lewin said. ``We still have a few markets that are available that are open, and it's just a matter of watching how things progress and determining down the road if those plans match for both our companies. But the possibility's certainly there.''
An ATD spokesman said the distributor will have a better idea in six to 12 months where the ACCC work fits into its portfolio, and any growth will have to be agreed upon by both ATD and ACCC.
Mr. Lewin said the addition of a large distributor should not pose a problem for ACCC's smaller distributors. He pointed to longtime ACCC distributor Ampac, which services more than 200 dealers. Some of ACCC's smaller wholesalers supply as few as 25 dealers.
``So we're quite used to gravitating with the small and the large under the same umbrella,'' he said. ``That's not a problem.''
Will Tolerton, president of Terry's Tire Town, said the addition of Virginia to the distributor's ACCC region in parts of Ohio and Pennsylvania plus Maryland, Delaware and West Virginia will ``appease'' his company's appetite for growth for a few years. But he is not concerned about losing any territory.
``I'm definitely confident my partners in American Car Care will protect all of us in our territories we currently serve,'' he said.
Dennis Mangola, CEO of Ampac-which covers ACCC territory through much of the Sun Belt west of Georgia-also said he does not believe ATD's addition is a threat to his territory.
``Each one of us have our own territories and own responsibilities, and it's pretty well defined,'' he said, adding he believes ATD will do a good job in its assigned region.
As a member distributor, ATD can sign on new ACCC dealers but only in its designated territory. ATD also will sell the American Radial brand, but only to ACCC dealers in its area. Other brands handled by ATD include Michelin, BFGoodrich, Uniroyal, Bridgestone, Firestone, Goodyear, Continental and General. Of those, Target Tire had handled essentially the same except for Goodyear, the ATD spokesman said.