LEAVITTSBURG, Ohio (April 10, 2009)—Denman Tire Corp. is trying to snag a small bailout loan or new business from the federal government to survive today's hard times.
The struggling tire manufacturer had substantial losses from October through February and said it needs a $3 million loan or more government contracts to remain afloat in 2009.
The aid will allow Denman to implement a turnaround plan that includes purchasing new equipment, said Sanford “Sandy” Pensler, owner of Pensler Capital Corp., which owns Denman and several other companies. The capital would be put into the Leavittsburg plant to provide a broader range of products.
The firm has discussed both possibilities with U.S. Rep. Tim Ryan (D-Ohio), who Pensler said has been very helpful so far, “but we're only one item on his agenda.”
He hopes the company can benefit from contracts that fall under the stimulus bill. “We'll remain vocal to make sure it does happen.”
Pensler said that of late orders have picked up a bit and the firm has gained some new business. “I'm surprised that March has been this good,” he said.
If it continues, “then we're pretty well positioned” for the time being. “Our volume is off almost 40 percent, but that's beginning to come back now. We have our seasonal pick-up and if the economy starts to improve, that would help.”
In addition, Denman has added new tire designs, which has improved its product line.
“We're not that different from most tire makers,” Pensler said. “Most are in trouble. Several years ago we had contracts with the government, but Michelin then was awarded the contracts.” Those pacts primarily were for off-the-road tires.
Denman has been on shaky ground since October when orders plummeted and it began losing a considerable amount of money, Pensler said, and the last two years have been weak for the tire maker.
In 2007, employees took concessions, including a freeze in pensions and a reduction in retiree health care benefits.
The firm laid off about 85 workers in the latter part of 2008, he said, and now has about 190 hourly employees.
Pensler doesn't want to make more cuts or, worse yet, see the firm go out of business, so “we're beating the drums … we don't want to be passed up. I've owned the company for about 14 years and it's been profitable most of that time. Hopefully, it will be again.”