FULLERTON, Calif.—Yokohama Tire Corp. (YTC) has had a busy start to 2013, reshuffling its executive ranks, creating a sales company in Mexico and disclosing plans for a $400 million truck tire plant in Mississippi.
Starting in the executive suite, Hikomitsu Noji, president of Yokohama Rubber Co. Ltd. (YRC)—the Tokyo-based parent company—took over as president and CEO of YTC and CEO of Yokohama Corp. of North America, while retaining his positions at YRC.
YTC Chief Operating Officer Takayuki Ham-aya will be in charge of YTC's day-to-day operations, including strategy development, cor-porate planning and driving business performance. He's supported by former YTC President and CEO Norio Karashima, who was recruited to be executive adviser to YTC management at the company's Fullerton headquarters.
Other executive changes include: Tom Masuguchi, to senior vice president, chief strategy officer and deputy chief financial officer; Fred Koplin, to senior director, consumer sales; Rick Phillips, to senior director, commercial and OTR sales; Andrew Briggs, to director, marketing communications and product planning; Lawrence Kull, to director, tire business planning; and Jeremy Kahrs, to senior director, supply chain, logistics, corporate planning and OE sales. Additionally, YTC named Vice President Gary Nash to head up Yokohama Tire Mexico S. de R.L. de C.V., the new sales company in Silao, Mexico (see related story on page 1).
With sales of $1.47 billion in 2011, North America represents YRC's single largest sales market outside of Japan, representing about one-fifth of global sales. Sales in the quarter ended March 31 were essentially unchanged from the 2012 quarter at $245.5 million. With those changes in mind, Tire Business asked Mr. Hamaya to bring readers up to date on the firm's status and outlook for the remainder of 2013.
How do you think the market is doing so far this year? "This year has been challenging for us and our customers. Due to the economy still in recovery phase, consumers are more cautious, tending to save more and spend less. We are also seeing prolonged replacement periods as consumers hang on to their tires longer. Both of these impact demand on tires."
Is this what was expected or has it gone a little off prediction?
"A little below expectations so far, but the second half looks much better. There are already good signs in the economy and consumer confidence is on a good trend."
What kind of purchasing trends have you seen—for consumers as well as Yokohama customers? Are high-performance tire sales strong, or, in light of the slow economic recovery, are consumers simply purchasing the cheapest tires available for their vehicles?
"Despite some good signs, there is still a lot of uncertainty in the economy, so consumer spending has generally been soft. However, we are beginning to see sales in various segments—including high performance—catch up."
What are your expectations for the second half of the year? And with that, how does Yokohama see the OE vs. replacement market segments developing for the rest of 2013?
"The second half of the year will be definitely better. The OEM market data show that it will continue to be strong. However, Yokohama's strategic business model is actually focused on growth in the replacement market. The majority of our marketing efforts will be to strategically allocate capacity to maintain market inventories as needed and grow further in that regard."
What's your view on the wide-base single truck tire market segment? For instance, how much faster is it growing vs. the market overall? And what are Yokohama's efforts—if any— to take advantage in this sector?
"This segment of the market is definitely promising. Our new ultra-wide-base tires, (the) TY517 drive tire and RY407 trailer tire, are being very well received by the market. Leading edge technology, like our zero-degree belt construction, should improve retreadability. Overall, the market acceptance of these products is growing and the dependability and performance of the products continues to improve."
With all the executive changes that have taken place at Yokohama recently—especially in North America—are still more changes on the way? Is the company settling into a period of "stability" now as newly appointed execs become better versed in the company's North American operations?
"We have a very stable management structure. We have long-standing employees who are in new positions and we are very confident these changes will be highly effective and allow us to continue our record of success. "The changes will make Yokohama as a company stronger and more agile, which ultimately benefits our customer base. We can understand their needs better, provide more timely decisions and be more proactive in managing the needs of the market. "The key for us now is teamwork and enhancing internal communications. I started seeing improvements almost as soon as the changes were implemented."
With new executives in charge, will the company be taking a fresh/different approach to anything—from how it goes to market to marketing etc.?
"We will obviously continue to do all of the things that have made us strong over the years, like making sure our strategies consider the needs of our customers. However, the benefit of new executives is that they do bring new and innovative ideas to the table. This blending of market-proven strategies plus bold and new ideas will create an exciting future for Yokohama."
Describe the state of dealer relations with Yokohama.
"Since the management changes have been implemented, I have been visiting with a lot of dealers, sharing with them reasons for the structural changes as well as business approach. The reaction has been very positive. We have a seasoned customer base so they are used to the volatility of the market, but they can also see that Yokohama is poised in a positive direction given its new leadership and business initiatives. They appreciate the strength we have gained."
Any other types of trends you are seeing?
"Since Hikomitsu Noji has been appointed CEO of YTC, YRC's commitment to the U.S. is now stronger than ever. Communication with our parent company is better now than it has ever been. We have a unified vision and corporate plan that is understood and supported by everyone involved. We have several new and exciting products in future development and also a steady stream of new products expected to come out starting this year."