CANCUN, Mexico (April 13, 2016) — Rock and roll music has a reputation for being irreverent, but the leaders of Continental Tire the Americas L.L.C.'s Gold Program were anything but that as the company opened its 2016 Gold dealer business meeting April 12 at the Hard Rock Hotel in Cancun.
Instead the group's leadership stressed repeatedly how important its independent tire dealers are to the program and how it continues to listen to them and to strive to become their No. 1 supplier.
Rock music also is exciting and stimulating and the Conti Gold program executives delivered that, too, introducing three tires, including two that take the company into new product segments:
- the first-ever Continental brand all-terrain tire, the TerrainContact A/T; and
- General Grabber X3, a product that extends the Grabber light truck dirt tire to one that is designed for use on rock, in mud and in dirt. It is the company's first mud and rock tire.
Also new is the General Grabber Arctic, a winter tire designed for large SUV's and pickups.
“Our dealers have asked us to expand our product lines and that's exactly what we are doing here,” said Jim Sicking, Continental's director of sales in an interview following the Gold program business meeting.
Asked why it took so long to add these product lines, Mr. Sicking said the company had to wait until it had enough production capacity. “It makes no sense to launch a new segment when you can't supply current products,” he said.
Today, product supply is no longer an issue at Continental in the U.S. compared with three or four years ago, Mr. Sicking said, as new capacity has come on stream at Continental A.G. plants worldwide. This includes the two-year old facility in Sumter, S.C., that continues to ramp up production of passenger and light truck tires and has been earmarked for expansion.
Conti also has added light truck tire capacity at its factory in Mt. Vernon, Ill., including for building three-ply tires.
While there is no formal way to measure fill rates, Mr. Sicking said Conti's major distributors say the company is either No. 1 or No. 2 in fill rates in the industry over the last two or three years,
The introduction of new products is part of a list of wants Gold dealers have expressed to Continental executives in two surveys conducted over the past four years, which have served to guide the Gold leadership team as it strives to improve the program.
These suggestions include: keeping the program competitive, help with profitability, the need for more supply, frequency of contact with sales reps and improving brand awareness.
Continental has made progress in all areas, the executives said, highlighted this year with the introduction of the three new tires.
The Continental TerrainContact A/T is so new, in fact, that the company was unable to get one to show dealers at the beginning of the conference. It was set to arrive after the business meeting concluded but before Gold Elite dealers returned home several days later.
In researching plans to introduce the TerrainContact A/T, the company was surprised to learn that one third of roads in the U.S. are not paved, according to Joe Maher, product manager -- passenger. “So you really need to have off-road and on-road capability,” he said.
The market for off-road tires for light trucks and SUVs is estimated at 26 million units, meaning “37 percent of the industry we have not participated in at all,” he said of the Conti brand.
Conti is targeting the owner of late-model pickup trucks and SUVs with the TerrainContact A/T.
“In many cases these are the premium fitments where they want a tire that looks like an all-terrain tire, has capability of an all-terrain tire but they really are very interested in on-road performance, because they are doing the majority of their driving on road,” Mr. Maher said. “But they need off-road traction for some event in their life,” such as towing, driving to a mountain home, etc.
These vehicle owners value a quiet ride and good wet traction and want the tire to look like an off-road product, he said.
The new tire features Conti's Traction Plus Technology, which provides a combination of off-road capability and good road manners, according to Mr. Maher.
For off-road driving, the tire has an open, high-void tread pattern providing lots of gripping surfaces, he said. It also has large stable tread blocks for durability.
To reduce noise, Conti has designed the tire with noise blocking elements in the shoulders to keep the sound trapped inside the tread, Mr. Maher said.
For wet traction Continental used a patented-plus silane in the tread compound, an additive that bonds polymers and gives performance on wet or slippery roads.
The tire features an all-season tread design with traction grooves for grip on snow and full-depth siping that allows it to perform well both when new and as the tire wears. Sidewall styling is raised outline white lettering.
Continental spent three years designing the TerrainContact A/T, Mr. Maher said. This includes 100-plus hours of computer simulations, the testing of 1,500 tires, 12,000 hours of machine testing, 1 million miles of machine testing and over 2 million miles tested.
“So before the product actually gets ready to go to market there is a lot of work that's done...by our developing team...to make sure it's targeted for the consumer and that it is easy to sell for the dealer,” he said.
The TerrainContact A/T will come with a 60,000-mile treadwear warranty, a 60-day trial period, three years of roadside assistance, 12-month road hazard coverage, a 72-month manufacturer's warranty and a U.T.Q.G. rating of 680 AB in S- and T-speed rated sizes and 680 AA on H-speed rated sizes and above.
Continental will offer the tire in 35 sizes covering 80 percent of the premium tire market, including 20 metric sizes with 12/32nd inch of tread depth covering 45- to 75-series aspect ratios and 16- to 22-inch rim diameters.
In addition the tire will come in 15 LT metric sizes with 16/32nd inch of tread depth, 60- to 80-series aspect ratios and 16- to 20-inch rim diameters.
Conti will begin shipping the tire in September, with full availability scheduled for November.
Joining the TerrainContact A/T in the Continental tire lineup is the General Grabber X3, which will replace the Grabber red-letter sidewall tire.
“The X3 is a tire that has a much broader appeal” than the previous tire, Mr. Maher said, and is designed for use in mud, dirt, rock and on-road applications.
It is targeted at true off-road vehicles, 4X4 trucks, any vehicle from the OE wheel to completely modified vehicles for off-road use.
Like the TerrainContact A/T, Conti spent three years developing the Grabber X3. The company tested 16 different tread patterns, as the tread is especially important to off-road performance, Mr. Maher said. All told the company spent 500 hours testing the tire off-road at its test track in Uvalde, Texas, tested more than 1,000 individual tires and invested over 20,000 man hours in testing. Overall, the tire underwent more than 2 million miles of testing, including being competition-driver approved.
The Grabber X3 features an aggressive tread pattern, including a strong muscular-looking off shoulder that offers additional performance capabilities, Mr. Maher said. Sidewall styling includes black lettering as well as red-outline lettering in select sizes.
For grip in the mud, the tire features a high-void tread pattern that includes large, self-cleaning evacuation channels. Alternating shoulder scoops in the tread also help remove mud.
For driving on dirt, the tire employs stone bumpers that help to release stones embedded in the tread blocks. This also minimizes stone drilling and enhances puncture resistance.
To aid in driving on rock, the tire features multi-angle gripping edges that provide traction in every direction. In addition side-grip deflection pads help protect the tire body but also add grip to the sidewall and shoulder area of the tire.
The tire comes with a three-ply construction in all sizes and a multi-pitch tread pattern to reduce noise on the road.
Conti will offer the Grabber X3 in 29 sizes and 42 articles. This includes 13 flotation sizes with 21/32nd inch of tread depth, in 15- to 21-inch rim diameters and 10.5- to 13-inch widths. The tire also will be available in 16 light truck metric sizes, with 18/32nd inch of tread depth, 55- to 75-series aspect ratios and 16- to 20-inch rim diameters.
For winter driving, Continental is adding the General Grabber Arctic designed for large SUVs and pickups. The tire is positioned between the Grabber Arctic LT and the General Altimax Arctic.
Mr. Maher said the Grabber Arctic offers a high level of comfort compared to standard passenger tires and all sizes are extra-load rated for maximum market coverage.
The tire is designed with a robust tread compound, ultra-high-strength steel belts and a broad contour.
For traction in snow and ice, Grabber Arctic employs winter traction technologies, two different kinds of siping technology, is pinned for studs and has tread-block reinforcement buttresses that help create stability on high center of gravity vehicles.
Conti will offer the tire in 15 sizes, replacing seven sizes of the Altimax Arctic and adding eight new sizes. The tire will be available starting in the fall.
A total of 650 attended the 2016 Continental's Gold program reward trip to Cancun, including company employees and 335 elite Gold dealers (and their spouses) who purchased a minimum of 2,000 Continental and General tires during the past year. Of these, 71 dealers attended the trip for the first time.
During the past year, purchases by Gold dealers grew 14 percent, Gold rewards were up 15 percent, elite dealer purchases rose 9 percent, elite dealer rewards increased 13 percent and the year ended with the most elite dealers ever, said Chris Jenkins, national programs manager.
For 2016, Continental has added new sponsorships for the General brand, including expanding its involvement in competitive fishing and with ARCA (Automobile Racing Club of America) stock car racing.
In addition to its relationship with Major League Fishing, the tire maker has signed deals with FLW (which is named for Forrest L. Wood, founder of Ranger boats and developer of Ranger fishing boats) and Bass in media buys and is sponsoring four Bass Elite anglers.
Fishing is the No. 2 participation sport in the U.S., behind bowling, said Travis Roffler, Conti's director of marketing.
Also in 2016, Continental has become the official tire and exclusive race tire supplier to the ARCA racing series with the General brand.
“ARCA produces some fantastic racing and allows us to expose the General brand to a whole new audience of motorsports fans,” Mr. Roffler said when the deal with ARCA was announced last fall. “We're eager to expand our portfolio and showcase our technologies to such a dedicated audience.”
Continental also expanded its sponsorships of college basketball, adding seven teams this past year for a total of 28. The new teams are Baylor University, Boston College, Butler University, Georgetown University, Indiana University, Louisiana State University and Villanova University,
In this year's NCAA tournament, six of the elite eight and all four finals teams in the tournament were sponsored by Conti. “It was like being the spec tire on the final four,” Mr. Roffler said. “Fantastic engagement with all of these schools.”
Overall, Conti received 6 billion impressions from its television commercials and courtside signage during this past year's basketball season, Mr. Roffler said.
To further its involvement in sports marketing, Conti just signed a deal with Dan Patrick and the Dan Patrick Show sports talk show. The deal is with Direct TV, Mr. Roffler said, and the show is broadcast simultaneously on NBC sports through local cable companies.
The show runs from 9 a.m. to noon every morning. Any time a coach is on, that segment will be encompassed in the Continental Tire Coach's Corner and there will be Continental tires visible as props on the show.
“I think this will then caveat into the possibility of using Dan Patrick in a television commercial for our college basketball activation,” Mr. Roffler said.
Finally, in keeping with the rock ‘n roll theme of the 2016 Conti Rocks Cancun Gold dealer event, to spark sales of the new two new off-road tires, the Continental TerrainContact A/T and General Grabber X3, and as a way of saying thank you, Mr. Sicking offered Gold dealers this incentive. If a dealer purchases 80 of either or both of the new tires in the fourth quarter, they will be given the choice of receiving a specially made General- or Continental –themed Les Paul guitar.
“I hope you have a lot of guitars,” a dealer yelled from the audience.
To reach this reporter, [email protected].