Online Exclusive: Yokohama sees growth in high-value tires

The aggressiveness that Yokohama Tire Corp. showed during the pandemic is paying dividends today, according to Jeff Barna, president and CEO of the U.S.-based subsidiary of Japanese tire maker Yokohama Rubber Co. Ltd.

Barna told Tire Business the company continues to strengthen its position in North America, bolstering its high value-added passenger car and medium truck tires lineup, while maintaining its commitment to the North American tire dealer.

How's business thus far in 2021?

Business across all segments has been strong thus far in 2021. The market is obviously in a better position versus this time last year when we were all faced with the uncertainties of the pandemic, so the adage that a rising tide lifts all ships fits here.

That being said, based on our approach to our business last year, we are reaping significant dividends and are outpacing the market in all categories.

What would you like customers to know about how your company tackled the challenges brought on by the pandemic?

We wrapped up 2019 with the anticipation that 2020 was going to be an incredibly promising year for us. Our perspective (at the time) was that the quality of our people and teams, organizational structure, programming, products and customer alignment were about as good as it's been since I arrived here at Yokohama in 2017.

While it might have been easy to feel (and act) "inconvenienced" by the pandemic, we rather elected to go on the offensive. The thinking was that others might take a more passive approach to the market while dealing with COVID, so we unilaterally viewed this as an opportunity to seize the moment.

Our employees and especially our customers embraced an "It's go time" approach, which not only has served us well throughout 2020 but created a great springboard for '21. In retrospect, our customers would be able to tell you that we approached 2020 with a good deal of aggressiveness that set us up extremely well for 2021.

How is your transition going being named president and CEO of Yokohama Tire Corp.?

It's going well. The company recognizes North America as a potential global driver of growth and the support we've received—and I've received personally from our customers—further ingrains this sentiment within the walls of our parent YRC. Given last year's volatility, the U.S. team was given an opportunity to embark on what I'd label to be a homegrown strategic planning process.

The outcome of our strategic plan was to gain even further alignment with YRC and, in particular, confirm strategic investments for this market throughout the plan year 2025.

I'm happy to say that we are highly satisfied that YTC will be given the opportunity to make even further contributions within the global YRC company portfolio.

Our objective is to become YRC's No. 1 entity worldwide by 2025, and we are confident that this can be achieved as a result of their committed support.

YRC recently announced its Yokohama Transformation 2023 (YX2023) strategy that involves the consumer tire sector focusing on high-value-added tires and the commercial tire segment seizing business opportunities presented by market changes. Can you explain that change and what it might mean to the way you approach business?

The backbone of YTC's strategy here in the U.S. for years has already been cemented in high-value-added passenger car tires along with our strength in medium truck. So, for all intents and purposes, there really shouldn't be any surprises for our channel partners but rather a confirmation that YTC's GTM strategy is sound.

Do you expect any supply difficulties in the second half of the year?

Our industry's supply chain remains an unbelievable challenge and still requires months of work to sort out. I won't go on to list the litany of issues confronting us all primarily because your publication has done an excellent job of keeping us all current on the malaise.

As for YTC, we are told that our fill rates are actually better than most, which is a sad commentary knowing that we are nowhere near where we want to be or should be.

How have backups at ports impacted business? Do you expect the situation to resolve anytime soon?

We are starting to see some relief in terms of the California ports working down the congestion and turning ships faster, however I feel as if we will have to live with the premium paid on ocean freight containers for the foreseeable future.

The only way to technically deal with the delays would be to encourage higher stocking levels in our D/Cs, which is great in theory but hasn't been as practical in execution based on current customer demand.