Dealer Tire wins business from Southeast Toyota

CLEVELAND — Southeast Toyota Distributors L.L.C. has engaged Dealer Tire L.L.C. to help develop an "enhanced tire retailing" program for 176 Toyota dealerships it supplies throughout the Southeast.

The deal between Dealer Tire and Deerfield Beach, Fla-based Southeast Toyota includes provisions to supply replacement tires to Toyota dealerships in five states, beginning Dec. 1.

Dealer Tire, which sells replacement tires to more than 10,000 franchised new-car dealerships throughout the U.S., replaces TBC Corp./Tire Kingdom as Southeast Toyota's tire vendor.

Financial terms of the deal were undisclosed, but the agreement likely involves the sale of hundreds of thousands of tires per year.

Dealer Tire has a network of warehouses that can deliver tires to dealerships as often as twice per day, and it helps dealerships by providing retail materials and an online shopping guide for service customers.

A Dealer Tire spokesman said the agreement also includes training and tools intended to help Southeast Toyota dealerships boost customer satisfaction and retention.

Southeast Toyota distributes Toyota vehicles to dealerships in Alabama, Florida, Georgia, North Carolina and South Carolina. In 2016, Toyota dealers in those five states sold 472,596 new Toyotas, including 118,548 fleet deliveries. They also sold $514 million in parts and accessories, Southeast Toyota said.

Scott and Dean Mueller, brothers who built Dealer Tire into a $1 billion yearly business by focusing on selling replacement tires to new-car dealers, have been ramping up their efforts to teach dealers how to improve their tire retail skills.

New-car dealers have an estimated 8.5-percent market share of the U.S. tire replacement business, a figure the Muellers think could grow to as much as 25 percent in the next 15 years.

"If dealers are going to dominate their market in service, maintenance and light repairs, tires have to be part of the equation," Dean Mueller, 58, Dealer Tire's founder and president, told Fixed Ops Journal this month.

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Richard Truett is a reporter with Automotive News, a Detroit-based sister publication of Tire Business.