MEMPHIS, Tenn.BestDrive L.L.C. is a new player in the North American commercial tire/retread distribution business, but its owner/operator has a familiar name: Continental Tire the Americas L.L.C.
Seeking to improve the acceptance of and expand distribution of its ContiTread retread product line, Continental has established company-run BestDrive commercial tire sales/retread outlets in the Detroit, Memphis and Phoenix metro areas, according to Clif Armstrong, managing director of BestDrive at Continental Tire.
The goal of this initiative, he said, is to augment existing independent ContiLifeCycle retreaders in an effort to build a nationwide network.
Mr. Armstrong said Continental is opening BestDrive outlets only in markets where key fleet customers have told the tire maker they need a retread option before they'll commit to using Conti's new tires and where Conti is unable to find a viable independent business partner.
We went hard after the fleets to test our new tires, he said, and they came back to us and said, 'We need more points of light.'
The retread facilities being set up are designed for annual production of 45,000 to 48,000 units at full capacitythat is, with three curing chambers, two buffers, two builders, etc. in action.
The plants, laid out in 50,000- to 60,000-sq.-ft. buildings, start on a smaller scale with one or two chambers, he said, and ramp up over time.
The BestDrive outlets also sell new Continental- and General-brand truck tires and provide a range of truck maintenance services. The BestDrive locations have showrooms more representative of modern retail showrooms, he added, an effort to make the outlets distinctive in the marketplace.
Before opening a BestDrive location, Mr. Amstrong said Conti discusses the plan with its dealers in the targeted area to explain its rationale for the decision.
Our first option is always to have an independent ContTread retreader in a market, Mr. Armstrong said, but where we feel we have to, we'll put in our own stores.
That said, Mr. Amstrong said Conti has no immediate plans for more BestDrive locations. The BestDrive identity is one Continental uses in other markets worldwide, he added.
The Memphis location opened last September, he said, and the Detroit area plantin suburban Taylor, Mich.started production in early March.
The Phoenix location, by contrast, opened five years ago as Conti's original demonstration plant when it was setting up the Conti-LifeCycle network.
Now converted to a BestDrive outlet, it's located at the Lewis minimum security Arizona corrections facility in Buckeye, Ariz., west of Phoenix. The commercial sales/service facility is near to the prison grounds, whereas the retread plant is inside the facility, where inmates work alongside Continental personnel, earning a wage and learning a trade, Mr. Amstrong said.
Conti is one of a handful of light industries operating businesses at the facility, Mr. Armstrong said, under the auspices of the Arizona Correctional Industries (ACI). Wages paid to inmates go in part to offset their room and board costs, toward personal savings to be used upon release, or to victim relief in those cases where crime victims have been awarded judgments.
Conti launched the LifeCycle retreading system in 2011 and now has 15 licensed LifeCycle retread plants operating in the U.S. and one in Canada.
Another benefit of operating company outlets, Mr. Armstrong said, is it helps Continental fine-tune the retreading process and pass along best practices to its licensed retreaders.
The Memphis outlet is designed to employ 25 at full capacity, Conti told local authorities when it was seeking tax incentives for that unit. That document put Conti's investment in equipment at $1.4 million.
Mr. Armstrong has been with Continental since 1993 and has served in a variety of executive positions since, including director of marketing for commercial vehicle tires, his position prior to this latest change.
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