QUINCY, Ill.Titan International Inc. is stepping up efforts to shore up market share in key sectors while also cutting personnel both domestically and abroad to contain costs.
Titan International Chairman and CEO Maurice Taylor Jr. outlined the company's situation and action plan in an open letter to shareholders, customers, etc.
In the letter/press release dated Oct. 16, Mr. Taylor stopped short of disclosing Titan's anticipated revenue and earnings forecasts for fiscal 2015, saying there are too many variables that likely will change in the coming months.
Among specifics Mr. Taylor did share:
Titan is cutting in half its workforce in Russiawhere its Voltyre-Prom venture operates a plant in Volzhskiyaiming to reduce employment there to 1,000 by year-end from 2,300 in January 2014. Without disclosing specifics, Mr. Taylor said Titan believes this measure will impact the bottom line next year significantly.
Several high-ranking, long-time executives are retiring at year-end, including: Cheri Holley, general counsel; Kent Hackamack, vice president of corporate development; Ron Schildt, past president of Wheel Group; Mary Ann Wray, vice president of purchasing; Bill Campbell, executive vice president, chairman of Titan Tire; and Michael Akers and Ernie Rodia, consultants.
Titan is banking on the implementation of economic value-added (EVA) as its guiding performance management framework. Through EVA, Mr. Taylor said, Titan will be able to distinguish which business units are earning their full cost of capital and producing quality earnings.
Using EVA will provide Titan better insight into the discrete business drivers that will enable it to identify and prioritize the correlating initiatives that will drive growth and shareholder return, he added.
Mr. Taylor noted that two of Titan's business areas, farm and mining, are in cyclical downturns that should last minimally through 2015, if not into 2016.
He also said that Titan's management sees adoption by key vehicle makers of Titan's proprietary LSW low-sidewall tire/wheel concept as key to the company's sales resurgence and market share gains.
Mr. Taylor stressed that Titan has demonstrated time and again the performance improvements available through using the LSW systemfuel savings of approximately 6 percent, higher operating speeds, greater durability and the mitigation of road loping and power hopping, for examplebut noted that the key vehicle makers have yet to spec LSW as an OE fitment.
Titan now hopes the overwhelming positive feedback from farmers will result in pulling the LSW option through the dealer sales channel and then, in turn, influence the OEMs as to the value of the LSW, Mr. Taylor said.