FRANKLIN, Tenn. — Things are progressing nicely for Triangle Tire USA, according to CEO Manny Cicero, who responded to a questionnaire provided by Tire Business. Even though sales aren't as strong as the company expected, Mr. Cicero expects demand to increase in the second half of the year, as Triangle moves closer to breaking ground at its new tire facility in North Carolina.
Q: With the year nearing its halfway point, how would you describe business thus far in 2018?
A: Stronger than last year but not quite as strong as expected. All economic indicators point to extra heavy tire demand, especially in commercial tires. Sales have increased year-over-year as we continue to grow our distribution footprint. But it's definitely been a challenge to consistently achieve our budgeted numbers.
Q: What are some of the pleasant surprises you are seeing in the industry?
A: One of the really bright spots this year is strong OTR tire demand, especially in larger-diameter sizes. Nothing in this industry can surprise me much anymore but I guess what surprised me most was the joint ventures between Michelin/Sumitomo and Goodyear/Bridgestone.
Q: Where do you see the industry markets heading during the last half of 2018?
A: As dealers deplete their inventories, we expect the second half of the year to be much stronger than the first.
Q: What kind of trends are you seeing in the marketplace? How is your company reacting to them?
A: Consolidation of national distributors by Tier 1 manufacturers (Michelin and TBC, Goodyear/Bridgestone with Tire Hub). Our strategy has been to target regional distributors in favor of national players. In that sense, these consolidations have not had that big of a direct effect on Triangle.
In fact, there seems to be a movement by strong regional distributors to consolidate into groups to combat what they see as competition by their own Tier 1 suppliers.
Q: What sectors look to be strong? Are they sustainable for the future?
A: 1. Large OTR; 2. Specialty tires; 3. Light truck; 4. UHP. We think they're sustainable.
Q: What tire sectors are struggling?
A: We don't see any segments struggling. Just some doing better than others.
Q: Can you provide an update on the new plant scheduled to be built in North Carolina?
A: The plant is progressing on schedule with all necessary contracts with North Carolina officials signed and the project management team firmly in place. More important, Triangle has secured permission from the Chinese government to make the necessary investments in the U.S.
Q: Has any work begun at the site? Is there a target date set for groundbreaking?
A: Preliminary work has already started on the site. Drones will be utilized to chronicle the construction process. Groundbreaking is pending all necessary permits. We anticipate late summer for the official groundbreaking to occur.
Q: What kind of impact has antidumping and countervailing duties had on Triangle?