Do freighters continue to be the biggest bottleneck in the supply chain?
Yes, absolutely. In 2021, we were blind to where the containers were after they were put on the ship. At the height of the supply-chain issue, we had containers that were at the docks in Long Beach and Los Angeles ports but couldn't be located due to the tremendous number of containers they were handling.
At one point there were more than 100 container ships waiting off the coast to dock and unload. 2022 has been better, but the challenge for us as well as our customers now is handling and scheduling multiple containers for delivery.
Are you being hit with unexpected premiums?
Without a doubt. Aside from ocean freight costs which have increased four-fold in some cases, the costs for delayed deliveries and demurrage are a big issue. Over-the-road-trucking shipment rates have increased dramatically as well as rail shipment rates. At one point in late 2021, rail rates were higher than over-the-road truck rates.
What was the strategy behind the recently launched marketing portal for dealers?
We want to improve communication with our dealers, make it easier for them to access information they may need for marketing purposes without having to pick up the phone and call someone. It is still a work in progress, but so far it has been well received.
What continues to drive your growth?
We are a premium player in the value segment or Tier 3 market. We have been focused on supplying high quality tires to our dealers at a reasonable price. That strategy has proven itself over the past many years.
What are you telling dealers who are unable to get certain tires?
We try to be honest with them about availability and as transparent as possible about lead times, deliveries and manufacturing capacity increases. Most of our customers understand because this is affecting everyone.
What are some pleasant surprises in the industry?
The growth in the business and our customers' understanding of the new realities we are all facing in the tire industry — from ocean freight costs, supply-chain issues, manufacturing capacity issues, to inland freight issues.
What kind of trends are you seeing in the marketplace?
The emerging EV and hybrid market in commercial vehicles is no longer just a trend. It is a reality. Our strategy of marketing a strong, durable four-belt casing, which can be retreaded multiple times, fits the needs of this segment extremely well. With the extra torque of EVs, drive tires will wear more quickly and casings that are capable of multiple retreads will be at a premium and in high demand.
Do you expect to roll out any additional products in 2022?
We have introduced a new 3PMS snow tire line called RSD3 in 11R22.5, 11R24.5 and 225/70R19.5, and we have added two sizes of the REM2 in the ROTR segment, 775/65R29 and 875/65R29. These are available now.
How is the company addressing sustainability?
Like many others, we are pursuing new materials and other activities that would bring us to net zero/neutral carbon emissions.