"We have some factories that are setting up their own distribution with API and other factories that are very happy just to do business with API and our brand. We represent significant volumes for the factories we do business with.”
Since it's a private company, Mr. Kreitzman declined to disclose sales volume, but said the company increased its sales 40 percent in 2013 over 2012.
He said the surge over recent years was not so much due to the end of the elevated tariffs the U.S. imposed on Chinese-made tires in 2009-2012 but to other factors, including the introduction of new products.
“We brought to market in the last two years 340 new SKUs,” he told Tire Business.
When the elevated U.S. tariffs were first imposed in 2009, API had to raise its prices 35 percent in the first year. “We didn't have 35-percent margin to give away,” he acknowledged.
“We dropped out of the gate a little bit when the tariff came on, because everybody just panicked and didn't know what to do. So there was a dip over two or three months and then people realized, 'We're going to have to buy tires.'
“And they started buying again. So there was a two- to three-month lull before and then business was back to normal. Margins were depressed but, all in all, sales were OK, and they continued to grow for API anyway,” Mr. Kreitzman said.
He expects continued growth in API sales over the next two to three years — in the range of 40 percent.
“A lot of that is due to new customers and new programs. It's not from our existing customer base, the market isn't growing at that pace. We just have some good things that are happening,” he said.