The industrial tire market isn´t for the weak of heart.
Money talks, and during the last decade, only a few determined, well-established industrial tire makers have survived in the U.S. Their counterparts sold out or took much of their production to China and other countries.
The departed primarily have been mass producers of rubber tires who discovered they needed to move overseas to remain competitive with companies in China. Their tires had become a commodity.
Remaining are several niche manufacturers that continue to succeed as domestic producers because their tires require more technology and engineering.
Demand for solid rubber and urethane specialty tires has been up for the last several years and that´s not likely to change any time soon, several industry executives said.
That´s especially true with forklift tires for the material handling sector, according to William LeMeur, executive vice president of Warren, Pa.-headquartered Superior Tire & Rubber Corp.
Specialization is the way to go
Long-established U.S. specialty tire companies such as Superior Tire and Thombert Inc. are optimistic that their successes of the past will continue long into the future. Their specialized operations make it difficult for low-cost offshore tire makers, especially when it comes to polyurethane products, to cut into their business in North America.
Even a number of foreign-owned industrial tire manufacturers like Solideal International S.A. subsidiary Solideal Tire Co., which operates a plant in Muscle Shoals, Ala., see the benefit of making specialized tires in the U.S. for markets in the country.
"Urethane tire manufacturing has a pretty safe base here, safer than most in the industry," said Robert Moore, general manager of the facility.
Foreign competition in the industrial tire market certainly exists, LeMeur cautioned, but primarily in the pneumatic end of the business, an area in which Superior Tire doesn´t compete. "We´ve never been involved with the high-volume tire market.
"In terms of our niche market (aftermarket and original equipment specialty tires), both rubber and urethane, we have the right product ready to deliver at the right time." That includes tires used in food warehouses and other distribution centers.
"Our ability to be responsive allows us to be competitive and remain alive in the market," LeMeur said.
Thombert is in a similar boat, principally because the polyurethane tires and wheels it manufacturers for electric forklift warehouse trucks require a great deal of technology.
"It´s a stable, competitive business, but it´s not big enough that the Chinese want to jump in and make them," said Walt Smith, Thombert chairman and CEO.
The company, which produces its wheels and tires for both OEM and aftermarket distribution, operates a plant in Newton, Iowa, where it is based, and another molding facility in Brooklyn, Iowa.
It also exports some of its goods, although Smith didn´t say what percentage is shipped overseas.
Future looks bright
A number of Solideal´s specialty urethane tires are used to move steel, food and beverages, Moore said. "We cater to just about any distribution service."
The company, which also exports some tires, began manufacturing specialty tires in the U.S. in 1999 because "the U.S. market as a whole is a strong market," he said.
"And (the U.S.) is a good place to produce tires because of the availability of a work force, the climate for urethanes and availability of machinery. Raw materials for urethane also are made in the U.S. so chemical costs are lower here, although labor is higher."
LeMeur cited Superior Tire´s ability to respond quickly with quality products, "along with our superb engineering abilities and excellent location" as reasons for the company´s on-going success. It´s important to be near the firm´s customers in the U.S., he said, "so we´re not going anywhere."
Superior Tire can´t really compete on price, he noted, but its technical excellence, engineering, service and delivery offset those prices.
Thombert´s polyurethane tires and wheels, primarily used for electric forklift trucks in warehouses, require a lot of technology, Smith said.
Because of that, the company has not experienced much competition from low-cost manufacturers in Asia.
"Demand for our products is well-defined," he said. "The material handling market is growing with the economy-about 4 percent to 5 percent per year. As long as people consume groceries, there´s a need to move food around. It´s a stable but competitive business."
Smith, LeMeur and Moore said that much overseas competition is unlikely within the next several years. "Electric trucks are going faster and carrying heavier loads," Smith said. "Companies want speed and load-carrying ability," and that takes a lot of innovative technology, which long-established U.S. firms have in abundance.
There always will be room in the North American market for companies that can promptly deal with the ever-changing needs of their customers, LeMeur said.
As long as businesses focus on their niche markets and work to improve their offerings, they´ll be successful, he said.