American Tire Depot expands network

CERRITOS, Calif. (Oct. 31, 2014) — After nearly a decade of steady growth, Cerritos-based ATV Inc. kicked it up a notch the past couple of years, opening or acquiring 27 stores and pushing its American Tire Depot retail network to 72 locations, including its first outlets in San Diego.

From 2004 to 2012, ATV's retail store growth averaged two to three locations a year, increasing to 45 stores from 25 locations. In 2012-13, the dealership ramped up its growth to seven stores — aided by the unexpected availability of several former Scher Tire stores — and then 20 in the past 12 months.

The dealership, which also encompasses a thriving wholesale business under the Wholesale Tire Distributors banner, expects to keep growing.

“We're always looking for expansion that makes financial sense,” according to Avo Kamberian, ATV's marketing director. “We are here in California today and for the foreseeable future, that will remain the focus.”

Eleven of the new stores in the past year came via two acquisitions — six Ace Tire Center stores in San Diego and five stores from Phillips Tire Co. of Fullerton, Calif.

Financial terms of these and other acquisitions were not disclosed.

The former Ace Tire Center's stores in the San Diego area — in Chula Vista, El Cajon, Kearny Mesa, Lemon Grove, Point Loma and Poway — establish a sufficient-sized base to build on in that area.   

Business partners Mark Pugh and Steve Williams founded Ace Tire in 2007. The stores were affiliated with CarQuest Auto Parts' “Tech-Net” auto service network.

Mr. Pugh declined to comment on the sale of Ace Tire to ATV, referring all questions to ATV.

The Phillips Tire deal closed this summer, Mr. Kamberian said, coinciding with the retirement of the dealership's owner, Dale Phillips, after more than 50 years in the tire business.

The stores, in Cypress, Fountain Valley, Fullerton, Santa Ana and Westminster, are being converted to American Tire Depot signage.

Mr. Phillips could not be reached for comment.

The rest of the new stores were either single-store acquisitions or purchases of commercial property not occupied by an automotive service business, Mr. Kamberian said.

The dealership's growth in 2012-13 was boosted in early 2013 by the takeover of four former Scher Tire Inc. stores following the unexpected death in November 2012 of owner Bruce Scher.

The dealership declined to comment on the circumstances that led to those store acquisitions.

The company's sales reached $105 million last year, with retail accounting for about 85 percent of business.

Separately, ATV noted that ATV owner Ara Tchaghlassian was honored in late 2012 with the Small Business Administration's State of California Entrepreneurial Success Award, in recognition of his abilities as a successful entrepreneur.

Mr. Tchaghlassian built ATV from a single franchised Discount Tire Center location in Santa Fe Springs, Calif., in 1991 to a chain of 42 American Tire Depot stores (at the time of the presentation) throughout Southern California, providing jobs for more than 340 employees, the SBA noted in its presentation.