Nitrogen equipment, service can benefit consumers, dealers

AKRON — Few would deny the benefits of using nitrogen to inflate tires. However the product is still not a common offering in tire service shops — which could provide a competitive advantage.

Companies that sell nitrogen-inflation equipment and tire dealerships that offer the service view nitrogen as an easy and profitable add-on service.

"It's definitely a profitable add-on, and the main reason, I would say, is it brings people back into your door," said Matt McWilliams, service solutions national account manager, aftermarket for Mahle Aftermarket Inc.

"So if you're putting nitrogen in their tires, and they come back in and they need more nitrogen,…they're going to come back to you, and at that point you have a chance to upsell them on other things," he said.

• This story appears in the July 31 print edition of Tire Business.

"One thing we do see is that people who do get nitrogen, keep nitrogen. And generally, if you don't have it, they'll go somewhere that has it," said Tom Bolgrean, president of Branick Industries Inc.

"You know, it's an inconvenience for them if you don't have it. So the customers that have nitrogen seek out locations that offer it so they can get their tires worked on or get work on the car. They know they're getting nitrogen in the tires…. It's definitely a competitive edge to have it in your location."

In the near future, aftermarket auto service shops will be seeing more vehicles with tires already filled with nitrogen as new car dealerships have been adopting nitrogen.

"We're seeing the typical customer is usually a car dealership, as well as tire resellers," said Branick's Mr. Bolgrean, whose company has been manufacturing nitrogen generators for about 15 years.

"One of the things we hear from them is, 'I've got customers coming in asking for it (nitrogen), so I got to have it.' That's just one of the things.

"Car dealerships — they provide it as an add-on to the sticker price of the car. So they'll preload new cars, as well as offer it to their service customers," he noted.

Mahle has been selling nitrogen inflation equipment for almost a decade.

"We've seen a bit of a resurgence in it lately because we have been marketing it a little bit differently," Mr. McWilliams said. "We've been going back to the dealerships and getting them to put it in all their new vehicles off the lot."

Both companies said the sales trend for nitrogen equipment has been steady.

"Over the last 24 months, it kind of went from us pushing (nitrogen equipment) to them coming and asking for it. Independent shop owners are definitely more aware of how they can make extra money within their shop," Mahle's Mr. McWilliams said.

"With new car sales being so high, the independent aftermarket guys are looking for every advantage they can get to get a return on investment."

Plaza Tire Service, based in Cape Girardeau, Mo., offers nitrogen at 42 of its 62 retail outlets. President Mark Rhodes said eventually the dealership will offer the service at all the stores.

"What I've personally found out about nitrogen is it's a very customer-friendly item to talk about and, if the salespeople take the time and explain it, I would say well over 65 percent of the people to 75 percent of the people buy it — if it's explained to them correctly," Mr. Rhodes said.

"The main reason you would buy nitrogen is to keep your tires inflated to the optimum level, and therefore they get the best fuel mileage. To sell it on fuel mileage is the best way to do that."

Plaza Tire charges $2.50 to $4 per tire, depending on the market, for nitrogen fill and offers free top-offs.

"It's really a simple process, and everybody should do it," Mr. Rhodes said, noting he has seen a rise in popularity for nitrogen in his market.

"We've been doing it for several years, maybe seven to eight years. When we first started, it was completely unheard of. It's gotten more customer-friendly."

The bulk of Plaza Tire's nitrogen sales comes with new tire sales. "Most people at that point want to maximize the value on a new set of tires," he added.

"When your doing oil changes and rotations and other service work, it's obviously something you can recommend."

Ronald Morse, sales manager for Reese's Tire & Automotive Tire Pros in Cottonwood, Ariz., agrees.

The single-outlet dealership has been offering nitrogen for about five years for $5 per tire with free top-offs.

He said nitrogen is an easy sale. "When you explain the benefits and features of it, people like it," he said.

Mr. Morse said nitrogen sales have been steady for the dealership, which he said is the only shop in town to offer the service.

Retail giants Tire Rack Inc. and Discount Tire/America's Tire explain the benefits of nitrogen in tires on their respective websites but, in the end, they recommend that instead of consumers paying extra for nitrogen, they are better off regularly checking the air pressure in their tires.

The cost of nitrogen generators can average about $4,500 to $5,500, but the price varies depending on type and size, according to Mahle.

"A shop can make that money back typically in the first year, if not sooner," Mr. McWilliams said, noting that car dealerships recoup the cost in the first month because they roll the cost into the new car price, sometimes at around $10 per tire.

"It doesn't take long to pay the equipment off, and that's without charging a lot for the service," Mr. Bolgrean said, noting that $20-$25 per set of tires seems to be the typical range for nitrogen. Some offer it free while others charge higher amounts.

According to a Clemson University study, nitrogen inflation in passenger car tires can extend tire life while improving the fuel economy of the vehicle.

Nitrogen-inflated tires can maintain tire pressure 74-percent better than shop air per month at normal operating conditions and thus provides 70-percent less rolling resistance than tires inflated with air.

Several major tire makers support the use of nitrogen in tires based on nitrogen's ability to retain air pressure longer, since the gas does not permeate the tire rubber as easily as air molecules.

Nitrogen also lacks the damaging moisture inherent in shop air.

When tire pressure monitoring systems (TPMS) became required equipment on vehicles built since 2007, consumers became more aware of TPMS hardware — and what it costs to replace it, according to Branick's Mr. Bolgrean.

"Nitrogen, again, I want to say, is an ideal inflation gas because it's dry, and it's not as hard on the TPMS hardware that regular air and moisture and contaminants can bring to that hardware and render them broken and having to be replaced," Mr. Bolgrean said.

It is incumbent on the tire dealer and service adviser to educate consumers on the benefits of nitrogen for their tires, according to proponents.

"Your average consumer doesn't come in and say, 'Hey, can you put nitrogen in my tires?'" Mr. McWilliams said.

"It's a growing consumer base that's aware (of nitrogen)," noted Mr. Bolgrean. "There's still a fair segment that doesn't really know about nitrogen.

"So one of the things I would suggest for people getting into nitrogen is you should talk to your customers about it. Mention it, if they ask questions. Explain why they should get nitrogen."

Dealers are fairly well educated on what nitrogen is and the benefits of it, Mr. Bolgrean added.

"We continue to talk about it the same way we have for the past 15 years. We offer counter materials, brochures and information for their customers to see and read as they are getting their vehicles worked on."

The passenger vehicle market is by far the largest nitrogen market, he added.

"When we first got into this, we focused on the heavy-duty trucks and 18-wheelers, because they count every mile they get on a tire. They really do benefit the most," he said.

However, long-haul truckers have a hard time finding sources for nitrogen top-offs when they are on the road because nitrogen dealers are thinly dispersed, he noted.