WASHINGTON (Sept. 22, 2010)—Beginning Oct. 1, the Rubber Manufacturers Association will be strictly an association representing tire manufacturers, according to RMA President Charles A. Cannon.
But that doesn't mean it won't work on issues of common interest with the Association of Rubber Product Manufacturers, the successor organization to the RMA's Elastomer Products Group, Cannon said.
“As of the end of our fiscal year, there will be two separate 501(c)(6) trade associations, each with its own management, boards of directors and budgets,” he said.
“It is a fundamental structural change,” Cannon said. “We will move forward in a cooperative spirit, but fully independent of each other.”
With the separation of the ARPM from the RMA, the latter group loses one senior executive and one staff member, as well as about $500,000 from its previous annual bud- get of $7 million, according to the RMA president.
“We're presenting a new budget to the board of directors of about $6.5 million, so it's a pretty clean break in that area,” he said. With the creation of the ARPM, the RMA now has 16 permanent staff members, he said.
The reinvention of the RMA as a tire industry organization will mean a major refocusing of the association's activities, beginning immediately, according to Cannon.
“The EPG, being a very diverse and dispersed membership, had a multitude of discrete issues, some of them unique to substrata within the group,” he said. “The creation of the ARPM refocuses the RMA and its core mission.
“Tire manufacturers have been the largest part of the organization for virtually its entire life,” he said. “This allows us to move to highly focused activities directed by the priorities of the tire sector.”
Statistics regarding RMA membership suggest the division of the RMA and the ARPM is a logical development of the evolution of the rubber industry, Cannon said.
In 1918, he said, the RMA had 340 corporate and 249 individual members. By 1981, membership stood at 215 companies; in 2000, 121; and in 2010, only 48.
“In 1918, the rubber industry consisted of a very dispersed group of small manufacturers, including the tire industry,” Cannon said. “But consolidation has been the rule in the industry almost since World War I.”
The RMA held steady at about 200 member companies for decades, but consolidation accelerated dramatically beginning in the late 1980s, especially among elastomeric product manufacturers, he said.
“We moved from the Molded and Extruded Products Division, to the General Products Group, to the Elastomeric Prod- ucts Group in an attempt to more efficiently serve our member companies,” Cannon said.
“We reduced dues substantially for EPG members, but the trend line was greater than we thought.
“It became apparent that we couldn't serve the two groups equally, but we didn't wake up to that until rather late,” he said.
At the time of this interview, the scheduled Sept. 7 meeting of the RMA Board of Directors was still in the future. Under the direction of its new chairman—Rich Kramer, Goodyear president and CEO—the board is working to identify emerging issues, as well as issues in which the RMA and the ARPM can work together, according to Cannon.
“Right now we are facing a combination of a much more activist NHTSA and EPA with a Congress that is largely unreadable at the moment,” he said. “The administration may be more intense in its activism as the perception grows of a less receptive Congress.”
Along with charting the RMA's actions on legislative and regulatory issues, the directors will work with the ARPM on transition issues, such as the ARPM taking on responsibility for the former EPG's collection of industry statistics and technical documents.
“We're working out an agreement for them to take full charge,” Cannon said. “As part of the transition, they'll be using the original EPG name for a while.”
While the exact change in the RMA's activities isn't yet evident, it will become evident quickly, according to Cannon.
“There will be new initiatives and e-merging issues, and a number of issues that have been quiescent will become more active,” he said. “It will not be a calm time.”
Six months of working out transitional issues have created a new, totally viable group that the RMA expects to work with on mutually vital issues, according to Cannon.
“We don't celebrate this event, but we recognize it is a rational and reasonable resolution to technical and institutional challenges,” he said.
“After a lot of effort to revise and retool, we have reached an appropriate separation.”