NBGI Private Equity, a fund focusing on traditional economy companies, has bought 41 Lex Autocentres from Lex Service PLC. They will be rebranded as Nationwide Autocentres and will offer high quality, fixed price servicing for retail and fleet customers. Further acquisitions are expected and Tom Dunn, formerly operations director at Lex Autocentres, has been appointed managing director of National Autocentres. The newly established Nationwide Autocentres network announced that the firm's focus would be on MoT testing and general maintenance for both the retail and fleet sector. However, they also had plans for future development and were piloting additional services to cover air conditioning, GPS tracking and LPG conversions.
Nokian Tyres has purchased the 13-outlet tyre chain of Dackaffaren for the sum of 4.3 million Euro. Dackaffaren had a turnover of 110 million Swedish Crowns (11.5 million Euro) last year and employs 70 staff. The company will be incorporated into Nokian’s Vianor tyre retail chain, which now consists of 50 outlets in Sweden and a total of 170 outlets in five countries. Kim Gran, Nokian’s President and CEO, says that the acquisition completes the company’s coverage in Sweden.
Michelin North America has selected Modern Media, a e-retail software specialist to develop its B2C initiative in North America. Michelin North America Inc’s Debra Track said, “Modern Media will help us create a platform that will allow us to go after a new generation of consumers that don’t necessarily use traditional media in their shopping habits”. The value of the deal has not been disclosed.
Nokian has released interim financial figures for the first nine months of this year. These show an increase in net sales of 7.4 per cent to 277.7 m Euro and an operating profit of 25.3 m Euro (11.9 m Euro for the same period last year). Net profit reached 9.1 m Euro (2.7 m in 2000). Nokian’s target for the year is to achieve a sales growth of around 10 per cent and improve on last year’s profitability.
Cooper-Avon Tyres has reshuffled many of its management team. André Korynevsky – responsible until now for retreading materials – has been appointed European Sales Director, liaising with the company’s offices in Germany, France and Switzerland. He will continue to manage the retread materials business. Phil Caris is the new European Sales & Marketing Director with responsibility for multi-brand strategies, coordinating global product management. As European Major Accounts Director, Steve Cundy will head a team of three, which will service the business with European retail chains, marketing Avon house and private brands, as well as developing fleet business.
Just Tyres Holdings, the group consisting of the Just Tyres retail chain, the Southam Tyres wholesale business, Autostop and Autostop fleet network, has called in the Administrative Receiver. 40 of the 90 Just Tyres depots were closed down immediately, resulting in 100 job losses, or one third of the total group workforce. Autostop Fleet has also closed down. The Receiver is looking for buyers, either for the group as a whole or its component divisions separately and reports “considerable interest”.
Nokian Tyres has released financial results for last year. Net sales were 398.5 m Euro, 23.5 per cent higher than 1999. Allowing for acquisitions made during the year, the figure was 359.8 m Euro, or 11.5 per cent higher. Operating profit was 39.4 m Euro (1999: 42.1 m), affected by a 1.7 m Euro loss incurred by the tyre retail chain. Net profit was 19.8 m Euro (1999: 25.7 m).
Continental Tyre Group is to set up a new UK truck network, comprising independent businesses with exclusive territories, managed by Continental. This will obviously affect the commercial division of Conti’s subsidiary National Tyre Services. Some will be sold, while some will be taken over by existing staff – a number of these are expected to join the new truck network, which will be called ContiNetwork.
In a speech at the conference which ran alongside the Essen Reifen 2000 exhibition, Sir Tom Farmer, Chairman and Chief Executive of tyre retailer Kwik-Fit, announced a change to the company’s famous slogan of “Our aim is 100% customer delight”. This, he said, is meaningless hype – nobody is delighted when presented with a bill for tyres, or an exhaust system, however good the service and product. Today’s customer is more sophisticated than his counterpart of a decade or so ago and he (or she) expects – indeed, demands – satisfaction when purchasing goods and services. Kwik-Fit’s new attitude to the customer is to try to give him what he wants and, if anything goes wrong, to move heaven and earth to rectify it. The words “delight” and “satisfaction” will disappear from adverts, letterheadings and the like, although Sir Tom said that service and customer care will continue to be a priority for Kwik-Fit. The move comes at a time when the company is undertaking its most aggressive-ever advertising campaign, offering four 12″ and 13″ tyres for £65, including valve, balancing and fitting. Never before have the company’s adverts featured prices so prominently, and never before have the prices been so cheap. Sir Tom Farmer says that the move is in response to actions by competitors and it is certainly having its effect on the tyre retail market. Kwik-Fit’s own house magazine underlines the aggressive nature of the campaign, saying that, if the prices are undercut, they will be reduced even further. “This is war!” says the article.
On Friday 4th August, the Montinex tyre retail group went into Administrative Receivership. Discussions with potential purchaser Stapleton’s Tyre Services broke down last month. The parts of the Montinex group in Receivership are Chessington Tyres, Malvern Tyres, Northway Tyres and Charlie Brown’s Autocentres, totalling some 144 retail outlets. It is hoped to sell these as a going concern. Fleet Tyre Management is not in Receivership and is continuing to trade. Montinex turns over £86m annually and employs 840.
It has been confirmed that Kwik-Fit has purchased the “vast majority” of depots which made up the Montinex group retail chain. Montinex was put up for sale by the Administrative Receiver in early August and the deadline for receipt of bids was 18th August. The Kwik-Fit deal was finalised less than two weeks later. Kwik-Fit would not reveal the exact number of centres involved, but said that the company would study them in detail in order to determine the best way forward for each – at this early stage no decisions have been made.
When Continental bought the UK retail chain National Tyre Service a decade ago, the company regarded its equity as a way of gaining a foothold in the market and increasing its market share. To put it simply, National was merely a vehicle for moving tyres. In the last few years, the German parent has realised the strategic importance and benefits of having its own chain and has re-thought its attitude. National turns over £150 m annually and it is no secret that the company has been making a loss over recent years but this, says Chief Executive Adrian Dunleavy, is due to change within the next five years, with the aim being profit and a sustainable market share. In an exclusive interview with TYRES & ACCESSORIES, Dunleavy discusses the details of the plan and the investment promised by Continental. He also gives frank answers to the critics of National’s “two tyres for the price of one” offer, who regard this as being responsible for today’s price cutting. And how does he respond to the widespread condemnation of the National Motor Dealer offer, which was designed to encourage motor dealers into the tyre business? The five-year plan requires time and investment and Continental have granted both. Dunleavy accepts that the pressure is on him to deliver results within the designated time frame.
Nokian Tyres has released figures for the first nine months of the year. Sales rose 29.9% to 258.6 million Euro (199 m for the same period 1999) and operating profit fell to 11.9 million Euro (18.4 m). Net profit was 2.7 million Euro (9.9 m).
Michelin has introduced a new initiative in the UK, aimed at supplying a single source, total tyre life package for fleet customers. Called Encore, the new service introduces a retreading facility for Remix tyres and the possibility of retreading new tyres from competitors. The retreads will be branded Encore and will only be available for fleet customers and not on retail sale. Further details are available in November’s TYRES & ACCESSORIES. The company has made ‘substantial’ investments at Stoke-on-Trent, including a new, independent retreading facility, in an attempt to woo fleet business. Encore will only be available to those customers who buy Michelin tyres as new, as the whole aim of the scheme is to increase sales of new Michelin tyres. For fleet customers, product alone is no longer enough, as they are demanding more in the way of services and tyre management. Encore gives Michelin a greater measure of control and enables the company to offer a ‘new to scrap’ tyre management service.