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Suppliers say tire dealers holding on to equipment longer

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AKRON—With the economy still in a state of flux, some tire dealers may be holding on to their old shop equipment as long as they can to get by.

Yet, with technological advancement in the field cropping up on a regular basis, a number of questions arise: Should you keep the old equipment? Attempt to upgrade existing systems? Or bite the bullet and buy new equipment? And when is the right time to buy?

“We see that the professional shops that we deal with are really starting to accept some of the newer technology on equipment,” said Larry Edgell, marketing manager for Akron-based Myers Tire Supply.

He told Tire Business the company is seeing tire dealers “really trend to the medium to upper lines of equipment” with the “higher technology.”

Mr. Edgell added shop customers are gravitating toward equipment that makes “it easier to do the job,” such as helper arms and balancers with automatic weight placement.

Greg Smith, owner of Indianapolis-based Greg Smith Equipment Sales Inc., said prices for high-quality shop equipment are dropping because much of it is being made in Asia.

“The price of high-quality equipment has come down drastically,” he said, and a lot of smaller shops “are able to perform more services than they were many years ago.”

Mr. Smith compared this to watching a ball game on a big screen TV. Ten years ago a person would have to go out to a bar or a restaurant with a wide-screen TV, but now everyone has them because they are more affordable.

“That's kind of the way it is in the automotive industry,” he added, “Many years ago, a tire changer was $5,000. Now you can buy a high-quality tire changer for $1,100 or $1,200, so more people are kind of doing their own thing.”

Mr. Smith said another shift for the small dealer is that equipment manufacturers are now allowing them to do some of their own repairs if equipment breaks down, instead of sending out a technician from the supplier.

“Many years ago the manufacturers would sell you a piece of equipment, but if it broke, they wouldn't let you fix it,” he said. “They had to send a technician out. They wouldn't let you install it—it would void the warranty. All that stuff has gone by the wayside now.”

Mr. Smith continued: “Our method of merchandising is this: If I sell a lift to a customer or a tire changer or a wheel balancer and he is reworking the electrical system on a Lexus, I'll bet you he's smart enough to put a new belt on a tire changer.”

Kevin Keefe, vice president of marketing at LaVerge, Tenn.-based Hennessy Industries Inc., said the company has noticed a trend of tire retailers who are “trying to extend the use of the life of their equipment.”

He said “more and more reliability and durability” play into the equation of “trying to extend that use of the (equipment's) life.”

Hennessy designs equipment with “a defined upgrade path in mind,” Mr. Keefe said, because its “goal is to never put a user in a situation where they are forced into a repurchase situation because of application capability.”

He added that “there's not a lot going on in terms of new tire and wheel technology that are pushing the envelope for new equipment purchases anyway,” so the decision is “a repair vs. replace, and the economics of that decision (are) dependent on the age of the equipment and the ability to be upgraded.”

Kaleb Silver, product manager for Bridgeton, Mo.-based Hunter Engineering Co., told Tire Business the equipment marketer has seen a lot of shops upgrading equipment.

“There have been many advancements in technology in recent years, especially with the introduction of our HawkEye Elite model of alignment equipment that takes away some of the less desirable effects that alignments might have had in the past,” he added.

“We do offer equipment upgrades that are appropriate for some customers, depending on the age of equipment,” Mr. Silver said. “But a lot of times, the best course of action for our customer is to do a new purchase.”

Mr. Edgell said that for a few years Myers Tire Supply saw companies buying used equipment. Now that purchasing trend has shifted. The companies see “more dealers going towards new” equipment purchases.

Mr. Smith compared the technological advancements in shop equipment to what has changed in a vehicle. A car still has four wheels and accommodates X-amount of people, he said, but “the accessories have changed. The ease of use has changed.”

“It's no different than a cell phone,” he continued. “With technology, computer-based pieces of machinery have become not only faster but more accurate, but when you're talking about a mechanical piece, like a tire changer or a lift, those are just mechanical pieces.

“The technology doesn't get any better on those. It's a piece of equipment. It can't be more aero-dynamically correct. So the lifts and the tire changers and the strictly mechanical pieces of equipment, we've not seen a lot of improvements because you cannot just re-invent the wheel on those things.”

Mr. Smith added that the pieces of equipment that are not just machinery have become more sophisticated, thanks to computer technology, such as tire changers, wheel balancers and alignment machines.

“Ten years ago, the alignment person in your shop was the guy that nobody argued with. Only one guy knew alignments and he knew the machine and whatever he said was law,” Mr. Smith said. “Well now, with the new alignment machines, virtually anybody in the shop can become familiar with the machine and the owner is not held at bay by the alignment tech.”

Mr. Silver agreed that alignment technology is an area with many changes.

“One big trend in alignments is the requirement by many car manufacturers to reset certain electronic systems in conjunction with alignment,” he said.

Mr. Silver said the most common is a steering angle sensor, which “is required by many manufacturers now to make sure that not only is the car traveling straight down the road mechanically because of the alignment that's been performed to the suspension of the vehicle,” but that the electronic systems also know what the car's new “straight-ahead” is.

“And they get reset to that (setting) so that they function properly from the time (the car) leaves the shop.”

Mr. Silver said Hun-ter's HawkEye system has “gone away from metal contact on the wheel, so that there's no chance of wheel damage whenever you do an alignment, and that's very appealing to a shop owner.”

He added that it “can mount to just about any wheel size in a very quick time with no changeover between sizes. It's just a simple extendable racket clamp-type system, where you place it on and clamp and you are good to go.”

Mr. Keefe said Hennessy has seen a higher emphasis on service bay throughput and productivity.

Dealers, he said, are asking: “How often is my machine up and running, and how quickly does it get cars in and out of my bay?

“Because bay turns equals revenue equals profit.”

Mr. Edgell noted that Myers Tire Supply sales have been steady, but for a tire dealer or auto service shop operator, deciding on what and when a shop buys new equipment depends on where the company is—as far as finances, plans for expansion and other factors.

“It's all based on individual needs,” he said.

Mr. Smith said that “if people are going to expand their business and go after new business for customers that are driving different types of vehicles than what they started out servicing, they're going to have to update their equipment to service those vehicles.”

To reach this reporter:; 330-865-6143.

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