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Price fixing among tire manufacturers



 
 
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  #11  
Old December 31st 07, 06:27 PM posted to rec.autos.makers.chrysler,alt.autos.gm,alt.autos.ford,alt.autos.toyota,rec.autos.makers.honda
My Name Is Nobody
external usenet poster
 
Posts: 475
Default Price fixing among tire manufacturers


"Ted Mittelstaedt" > wrote in message
...
>
> "Ray O" <rokigawaATtristarassociatesDOTcom> wrote in message
> ...
>>
>> >
>> > What happened to competition? Seems to me there ought to be a big
>> > case here for an anti-trust price fixing lawsuit against the tire
>> > manufacturers.
>> > Anyone have any ideas?
>> >
>> > Ted
>> >

>>
>> It is possible that all of the tires you shopped were made in the U.S.,
>> which would reduce the disparity in manufacturing cost.
>>

>
> That might be true, and it is true that there are not a lot of other tire
> manufacturers
> that make that size AND that mileage and UTQGS rating I looked at.
>
> But, if I went to a treadwear and UTQGS rating of about 1/2 of what I
> surveyed,
> then there's an order of magnitude larger number of tire manufacturers
> making that



There arn't that many tire manufactures...


> size. But, they are ALL the same tire price ALSO (or within very small
> amounts
> of each other) for that treadwear and UTQGS rating. I'd find it hard to
> believe
> they all make tires in the US.
>
> After surveying I found NOT a lot of price coorelation between tire
> mileage
> warranty and price, but I found a LOT of price coorelation between
> different
> tires of the same UTQGS rating. I found a LOT of tires with DIFFERENT
> mileage rating but the same UTQGS specs. So I tend to discount the stated
> mileage as marketing fiction. What matters is UTQGS. And another telling
> indicator of the importance of UTQGS is that some manufacturers hide it.
> Goodyear, for example, doesen't post that on their website - they tell you
> you have to get it from the tire brochure at the tire dealership.
>


In my business, I have found that if I want to (and I don't generally) have
the cheapest price (cheaper than any or all of my competitors) every dollar
beyond one dollar cheaper than the competition is a dollar flushed down the
toilet. Why do it? I am not involved in "price fixing", but I do monitor
the market, and if my prices are substantially lower than the competition I
will generally raise mine. not unlike the airline industry, or your local
gas stations. There is absolutely no benefit to being half the price of
your nearest competitor.




> However, it's pointless. The cheapest tire I could find in that size is a
> 40K tire and it's only 1/3 cheaper for 1/2 the treadlife. For
> only 1/3 again more of the price you get double the tire life. Plus the
> mounting
> costs are all the same cost as well as the road hazard warranty. In other
> words
> I can buy a road hazard warranty for 40K miles or a road hazard warranty
> for
> 80K miles - but they both cost the same. If the road hazard warranty was
> 1/2 the cost for the lower-mileage tire it might be worth it - but the way
> it's
> priced at the tire dealerships, it's cheaper-per-mile for the more
> expensive
> higher mileage tire. Not to mention with a 40K mile warranty you have to
> replace the
> tires twice as often so your doubling your installation costs.


Unless you do not keep the car for more than 40,000 miles...

>
>> Tires are a competitive business and a company whose products are priced
>> higher will have a tough time competing without a product attribute that
>> a
>> consumer is willing to pay for, especially in the most common sizes like
>> 205/70-15.

>
> That I understand well. But that isn't how competition is carried out
> these
> days. In most commodity markets there are maybe a maximum of 2-4
> manufacturers who are
> dominant players plus dozens of small fry. For example, in computer
> software
> it's Microsoft
> and Linux distributions. In computer hardware it's Dell, HP & IBM. In
> hard
> disk
> drives it's Seagate and Western Digital. In soft drinks
> it's Coke and Pepsi. In cars it's GM, Ford, Toyota, Honda & maybe
> Chrysler.
> In US crude oil it's Exxon, Texaco and a few others. And so on and so on
> and so on.
>
> All these commodity markets got this way because these dominant players
> gobbled
> up competitors until they ran up against the anti-trust regulators of the
> world's
> governments who prohibited further market acquisitions. Manufacturing
> economies of scale in today's markets dictate that the larger you are the
> cheaper you can make things. In most markets, consolidation sets in
> and continues until the governmental regulators put a stop to it, or
> declare
> a monopoly market and start regulating the dominant monopoly.



You can't earn 11,000,000,000 in quarterly profits, if you limit yourself to
some predetermined small profit margin now can your? These corporations
legal obligation is to earn a PROFIT, as high as the "market will bear, not
supply their goods at the cheapest possible price.


>
> Naturally, in these markets the few dominant competitors have the same
> product price since the margins are so thin - these companies make money
> on volume.
>
> It's only in niche markets (ie: specialty foods, etc.) that there's still
> a
> large
> number of companies, or in commodity markets (like milk) where the
> product cost is so low that freight charges make global distribution
> uneconomical, and you cannot reduce the product bulk (ie: freeze
> dry it) to reduce shipping But tires are very expensive and they are also
> very complex and take a lot of technology to manufacture.
>
> As you say, tires are competitive. And since there are so many many cars
> out
> there, there's huge amounts of tires sold. And since tires are complex
> and
> not
> easy to manufacture in the barnyard, the product lends itself to a
> commodity
> manufacturing model of single-source manufacture with wide distribution.
> But
> the reality is that the market does not appear to work this way. It seems
> to me
> that in reality, tires are far more expensive than they should be, because
> the



NOT UNLIKE gas and oil!!!


> tire companies have spent so much money on making hundreds if not hundreds
> of
> thousands of slightly different but almost the same model of tire. So you
> have
> a situation where there's a lot of small manufacturers all making small
> production runs,
> instead of a few large manufacturers making a few giant production runs.
>
> The situation seems really ripe for a well-heeled tire manufacturer to
> start
> acquiring
> other ones and killing off product lines right and left, and substituting
> a
> few
> much cheaper product lines, then making their profit on bulk. That is the
> pattern that has happened in the past in most other commodity industries
> with
> this kind of product, and the only reason I can come up with that it
> hasn't
> happened in the tire industry is that all of the tire manufacturers have
> gotten
> together and formed a secret cartel of some kind to fix prices.
>
> Is this it? Or is there something I'm missing about the tire market that
> lends
> itself to this incessant brand fracturing.
>


I really don't think it has anything to do with "price fixing". I think it
simply has to do with corporate greed, plain and simple.

Besides, if all the competition is selling x type tire for $250 a copy, you
would be negligent to your share holders, if you sold your x type tire for
more than a few dollars less than that...


> Ted
>
>



Ads
  #12  
Old December 31st 07, 06:31 PM posted to rec.autos.makers.chrysler,alt.autos.gm,alt.autos.ford,alt.autos.toyota,rec.autos.makers.honda
Gordon McGrew[_1_]
external usenet poster
 
Posts: 229
Default Price fixing among tire manufacturers

On Mon, 31 Dec 2007 12:00:26 -0500, Bill Putney >
wrote:

>
>Heck - look at all the people paying 1-1/2 to 3 times more for certain
>tires because they're "high performance tires", when those so-called
>high performance tires get maybe 1/2 the tread life of the "cheaper"
>tire, and that's only if those "better" tires don't become so noisy
>after 1/3 of their tread is gone that the owner replaces them
>prematurely, further losing what little value he paid for.


Perhaps it is unintentional, but you seem to imply that
"high-performance tires" are marketing hype. I can assure you that
these tires do in fact provide significantly higher performance than
standard tires, especially when the latter are bought on the basis of
treadlife projections or warranties.

To be sure there are some trade-offs, treadlife being the greatest of
these. The need to switch to winter tires (which also have less
treadlife, higher cost and much better winter performance than "All
Season Radials") is another. However, consider that you have a $20K+
vehicle, a million dollars in liability and your life invested in a
speeding vehicle which is held on the road by four contact patches the
size of postcards. Of course, most buyers of High Performance Tires
want the enjoyment of driving they provide and they are willing to pay
in dollars, road noise and inconvenience for that joy.





  #13  
Old December 31st 07, 06:37 PM posted to rec.autos.makers.chrysler,alt.autos.gm,alt.autos.ford,alt.autos.toyota,rec.autos.makers.honda
Jeff[_3_]
external usenet poster
 
Posts: 399
Default Price fixing among tire manufacturers

Ed White wrote:
<...>

> Faulty logic here. For one thing, Japanese manufacturing costs are not lower
> than US manufacturing costs. Another problem is shipping - tires are bulky
> and not cheap to ship. The impact of CEO salaries on individual tire prices
> is tiny. Goodyear's CEO is wildly over compensated (nearly $7 million last
> year), but that is only about $0.03 per tire (3 CENTS per tire - Goodyear
> sold over 226 million tires worldwide last year).


Goodyear also makes automotive belts (e.g., fan and serpentine belts),
hoses (both for cars such as radiator hose and garden hoses plus pipes
and other industrial hose/pipe products), conveyor belts, the rubber
tracks on bulldozers, automatic transmission parts, products for the
military and aerospace, air springs (I guess for big trucks) and other
rubber products.

<...>

> Clearly you are working off faulty data. In fact, there are large
> differences in prices for tires with similar predicted tread life. Given
> that tire manufacturing is a mature industry and all companies make tires
> essentially the same way with similar costs for raw materials, I am
> surprised there is as much difference in prices as there is.


However, different makers may use different types of rubber and other
synthetic compounds, explaining some of the differences. And different
manufacturing techniques may require special equipment. Both of these
will affect the cost that it takes to produce a tire.

> I think most of
> the difference in prices is based on marketing ability more than differences
> in manufacturing costs.


I agree.

Jeff

> Ed
>
>

  #14  
Old December 31st 07, 06:52 PM posted to rec.autos.makers.chrysler,alt.autos.gm,alt.autos.ford,alt.autos.toyota,rec.autos.makers.honda
Ray O
external usenet poster
 
Posts: 347
Default Price fixing among tire manufacturers


"Ted Mittelstaedt" > wrote in message
...
>
> "Ray O" <rokigawaATtristarassociatesDOTcom> wrote in message
> ...
>>
>> >
>> > What happened to competition? Seems to me there ought to be a big
>> > case here for an anti-trust price fixing lawsuit against the tire
>> > manufacturers.
>> > Anyone have any ideas?
>> >
>> > Ted
>> >

>>
>> It is possible that all of the tires you shopped were made in the U.S.,
>> which would reduce the disparity in manufacturing cost.
>>

>
> That might be true, and it is true that there are not a lot of other tire
> manufacturers
> that make that size AND that mileage and UTQGS rating I looked at.
>
> But, if I went to a treadwear and UTQGS rating of about 1/2 of what I
> surveyed,
> then there's an order of magnitude larger number of tire manufacturers
> making that
> size. But, they are ALL the same tire price ALSO (or within very small
> amounts
> of each other) for that treadwear and UTQGS rating. I'd find it hard to
> believe
> they all make tires in the US.


As Mark A pointed out, in a free economy, selling price is determined by
what the market will bear. The more competition there is, then the closer
the prices will be for products that the buyer perceives to be the same.

> After surveying I found NOT a lot of price coorelation between tire
> mileage
> warranty and price, but I found a LOT of price coorelation between
> different
> tires of the same UTQGS rating. I found a LOT of tires with DIFFERENT
> mileage rating but the same UTQGS specs. So I tend to discount the stated
> mileage as marketing fiction. What matters is UTQGS. And another telling
> indicator of the importance of UTQGS is that some manufacturers hide it.
> Goodyear, for example, doesen't post that on their website - they tell you
> you have to get it from the tire brochure at the tire dealership.


The UTQGS was developed to provide a uniform method of comparing tires, and
since mileage ratings are not part of the grading system, tire makers have
and use mileage ratings for "wiggle room" in their marketing.


> However, it's pointless. The cheapest tire I could find in that size is a
> 40K tire and it's only 1/3 cheaper for 1/2 the treadlife. For
> only 1/3 again more of the price you get double the tire life. Plus the
> mounting
> costs are all the same cost as well as the road hazard warranty. In other
> words
> I can buy a road hazard warranty for 40K miles or a road hazard warranty
> for
> 80K miles - but they both cost the same. If the road hazard warranty was
> 1/2 the cost for the lower-mileage tire it might be worth it - but the way
> it's
> priced at the tire dealerships, it's cheaper-per-mile for the more
> expensive
> higher mileage tire. Not to mention with a 40K mile warranty you have to
> replace the
> tires twice as often so your doubling your installation costs.


Due to R&D, raw material, overhead costs, and competition, the price of
tires is not linear, and so the selling price of a tire with twice the
treadlife is not necessarily twice the price of the tire with the lower
treadlife.

People who research the UTQGS and who have the money will buy the tire with
better ratings, but there are a lot of people who know little or nothing
about tires, who do little or no research, and/or who do not have the money
to afford the better tire so the tire makers offer lower priced tires to get
a piece of that market segment.

>
>> Tires are a competitive business and a company whose products are priced
>> higher will have a tough time competing without a product attribute that
>> a
>> consumer is willing to pay for, especially in the most common sizes like
>> 205/70-15.

>
> That I understand well. But that isn't how competition is carried out
> these
> days. In most commodity markets there are maybe a maximum of 2-4
> manufacturers who are
> dominant players plus dozens of small fry. For example, in computer
> software
> it's Microsoft
> and Linux distributions. In computer hardware it's Dell, HP & IBM. In
> hard
> disk
> drives it's Seagate and Western Digital. In soft drinks
> it's Coke and Pepsi. In cars it's GM, Ford, Toyota, Honda & maybe
> Chrysler.
> In US crude oil it's Exxon, Texaco and a few others. And so on and so on
> and so on.
>
> All these commodity markets got this way because these dominant players
> gobbled
> up competitors until they ran up against the anti-trust regulators of the
> world's
> governments who prohibited further market acquisitions. Manufacturing
> economies of scale in today's markets dictate that the larger you are the
> cheaper you can make things. In most markets, consolidation sets in
> and continues until the governmental regulators put a stop to it, or
> declare
> a monopoly market and start regulating the dominant monopoly.
>
> Naturally, in these markets the few dominant competitors have the same
> product price since the margins are so thin - these companies make money
> on volume.


I think you answered your own question here.
>
> It's only in niche markets (ie: specialty foods, etc.) that there's still
> a
> large
> number of companies, or in commodity markets (like milk) where the
> product cost is so low that freight charges make global distribution
> uneconomical, and you cannot reduce the product bulk (ie: freeze
> dry it) to reduce shipping But tires are very expensive and they are also
> very complex and take a lot of technology to manufacture.
>
> As you say, tires are competitive. And since there are so many many cars
> out
> there, there's huge amounts of tires sold. And since tires are complex
> and
> not
> easy to manufacture in the barnyard, the product lends itself to a
> commodity
> manufacturing model of single-source manufacture with wide distribution.
> But
> the reality is that the market does not appear to work this way. It seems
> to me
> that in reality, tires are far more expensive than they should be, because
> the
> tire companies have spent so much money on making hundreds if not hundreds
> of
> thousands of slightly different but almost the same model of tire. So you
> have
> a situation where there's a lot of small manufacturers all making small
> production runs,
> instead of a few large manufacturers making a few giant production runs.
>
> The situation seems really ripe for a well-heeled tire manufacturer to
> start
> acquiring
> other ones and killing off product lines right and left, and substituting
> a
> few
> much cheaper product lines, then making their profit on bulk. That is the
> pattern that has happened in the past in most other commodity industries
> with
> this kind of product, and the only reason I can come up with that it
> hasn't
> happened in the tire industry is that all of the tire manufacturers have
> gotten
> together and formed a secret cartel of some kind to fix prices.


While the most common tire sizes have become commoditized, tire makers offer
a lot of products in other sizes and areas, like earthmoving, farm, and
industrial equipment; aircraft; racing (which has a huge number of sizes and
types - Indy, Nascar, F1, off road, and everything in between); truck and
tractor trailer; and niche tires (low profile, snow, rain, high security).
Most tire makers also make other non-automotive products that use rubber
like bellows, gaskets, seals, shoe parts, etc. This diversity in product
lines enables them to make money on niche products with less competition.


--

Ray O
(correct punctuation to reply)


  #15  
Old December 31st 07, 07:48 PM posted to rec.autos.makers.chrysler,alt.autos.gm,alt.autos.ford,alt.autos.toyota,rec.autos.makers.honda
B A R R Y
external usenet poster
 
Posts: 25
Default Price fixing among tire manufacturers

Art wrote:
> You will find it is a crappy business to
> be in.


Yeah, you're always on the road. ;^)
  #16  
Old December 31st 07, 08:42 PM posted to rec.autos.makers.chrysler,alt.autos.gm,alt.autos.ford,alt.autos.toyota,rec.autos.makers.honda
Bill Putney
external usenet poster
 
Posts: 2,410
Default Price fixing among tire manufacturers

Jeff wrote:

> However, different makers may use different types of rubber and other
> synthetic compounds, explaining some of the differences. And different
> manufacturing techniques may require special equipment. Both of these
> will affect the cost that it takes to produce a tire.


And that will be money well spent if it results in a better product. Of
course if it only increases cost with no real benefit, then the
manufacturer is now at a competitive disadvantage (lower profit, higher
consumer cost or both).

Bill Putney
(To reply by e-mail, replace the last letter of the alphabet in my
address with the letter 'x')
  #17  
Old December 31st 07, 09:58 PM posted to rec.autos.makers.chrysler,alt.autos.gm,alt.autos.ford,alt.autos.toyota,rec.autos.makers.honda
Bill Putney
external usenet poster
 
Posts: 2,410
Default Price fixing among tire manufacturers

Ray O wrote:

> The UTQGS was developed to provide a uniform method of comparing tires, and
> since mileage ratings are not part of the grading system, tire makers have
> and use mileage ratings for "wiggle room" in their marketing.


You're saying the mileage ratings (400, 620, or whatever) are not part
of the UTQG? UTQG is only temperature and traction ratings?

Bill Putney
(To reply by e-mail, replace the last letter of the alphabet in my
address with the letter 'x')
  #18  
Old December 31st 07, 10:13 PM posted to rec.autos.makers.chrysler,alt.autos.gm,alt.autos.ford,alt.autos.toyota,rec.autos.makers.honda
Ray O
external usenet poster
 
Posts: 347
Default Price fixing among tire manufacturers


"Bill Putney" > wrote in message
...
> Ray O wrote:
>
>> The UTQGS was developed to provide a uniform method of comparing tires,
>> and since mileage ratings are not part of the grading system, tire makers
>> have and use mileage ratings for "wiggle room" in their marketing.

>
> You're saying the mileage ratings (400, 620, or whatever) are not part of
> the UTQG? UTQG is only temperature and traction ratings?
>
> Bill Putney
> (To reply by e-mail, replace the last letter of the alphabet in my address
> with the letter 'x')


The uniform tire quality grading system has a treadewear rating with a
control tire assigned a rating of 100. A tire with a rating of 400 would
have a tread life that is 4 times the control tire; a rating of 620 would be
6.2 times, etc. Mileage is not necessarily the same as treadwear due to
differences in tread pattern and tire circumference, so rather than list
expected mileage, they compare tread wear.
--

Ray O
(correct punctuation to reply)


  #19  
Old December 31st 07, 10:35 PM posted to rec.autos.makers.chrysler,alt.autos.gm,alt.autos.ford,alt.autos.toyota,rec.autos.makers.honda
clare at snyder.on.ca
external usenet poster
 
Posts: 286
Default Price fixing among tire manufacturers

On Mon, 31 Dec 2007 01:07:44 -0800, "Ted Mittelstaedt"
> wrote:

>
>"Ray O" <rokigawaATtristarassociatesDOTcom> wrote in message
...
>>
>> >
>> > What happened to competition? Seems to me there ought to be a big
>> > case here for an anti-trust price fixing lawsuit against the tire
>> > manufacturers.
>> > Anyone have any ideas?
>> >
>> > Ted
>> >


In checking prices for tires for my daughter's car, I found the
difference in price for THE SAME TIRE to vary 15% from the cheapest to
the most expensive tire reseller in my market area. The difference
between the private branded tire built in an American BFG owned
(Kelly) plant and Michelin, Toyo, and Bridgestone for the same quality
tire was about 10-13% at a dealer that sold all of them except the
private brand, and accross the market, about 15% between the highest
and lowest across brands.
I bought the private branded (Moto-Master from Canadian Tire) because
they had them in stock, could install them in a short time, and the
price was near the bottom of the range.

The chinese built tire from the same retailer was only a few bucks
less, and I don't buy Chinese CRAP if I have another alternative that
makes sense.

That is in the Kitchenr/Waterloo trading area in Ontario Canada.
>>
>> It is possible that all of the tires you shopped were made in the U.S.,
>> which would reduce the disparity in manufacturing cost.
>>

>
>That might be true, and it is true that there are not a lot of other tire
>manufacturers
>that make that size AND that mileage and UTQGS rating I looked at.
>
>But, if I went to a treadwear and UTQGS rating of about 1/2 of what I
>surveyed,
>then there's an order of magnitude larger number of tire manufacturers
>making that
>size. But, they are ALL the same tire price ALSO (or within very small
>amounts
>of each other) for that treadwear and UTQGS rating. I'd find it hard to
>believe
>they all make tires in the US.
>
>After surveying I found NOT a lot of price coorelation between tire mileage
>warranty and price, but I found a LOT of price coorelation between different
>tires of the same UTQGS rating. I found a LOT of tires with DIFFERENT
>mileage rating but the same UTQGS specs. So I tend to discount the stated
>mileage as marketing fiction. What matters is UTQGS. And another telling
>indicator of the importance of UTQGS is that some manufacturers hide it.
>Goodyear, for example, doesen't post that on their website - they tell you
>you have to get it from the tire brochure at the tire dealership.
>
>However, it's pointless. The cheapest tire I could find in that size is a
>40K tire and it's only 1/3 cheaper for 1/2 the treadlife. For
>only 1/3 again more of the price you get double the tire life. Plus the
>mounting
>costs are all the same cost as well as the road hazard warranty. In other
>words
>I can buy a road hazard warranty for 40K miles or a road hazard warranty for
>80K miles - but they both cost the same. If the road hazard warranty was
>1/2 the cost for the lower-mileage tire it might be worth it - but the way
>it's
>priced at the tire dealerships, it's cheaper-per-mile for the more expensive
>higher mileage tire. Not to mention with a 40K mile warranty you have to
>replace the
>tires twice as often so your doubling your installation costs.
>
>> Tires are a competitive business and a company whose products are priced
>> higher will have a tough time competing without a product attribute that a
>> consumer is willing to pay for, especially in the most common sizes like
>> 205/70-15.

>
>That I understand well. But that isn't how competition is carried out these
>days. In most commodity markets there are maybe a maximum of 2-4
>manufacturers who are
>dominant players plus dozens of small fry. For example, in computer software
>it's Microsoft
>and Linux distributions. In computer hardware it's Dell, HP & IBM. In hard
>disk
>drives it's Seagate and Western Digital. In soft drinks
>it's Coke and Pepsi. In cars it's GM, Ford, Toyota, Honda & maybe Chrysler.
>In US crude oil it's Exxon, Texaco and a few others. And so on and so on
>and so on.
>
>All these commodity markets got this way because these dominant players
>gobbled
>up competitors until they ran up against the anti-trust regulators of the
>world's
>governments who prohibited further market acquisitions. Manufacturing
>economies of scale in today's markets dictate that the larger you are the
>cheaper you can make things. In most markets, consolidation sets in
>and continues until the governmental regulators put a stop to it, or declare
>a monopoly market and start regulating the dominant monopoly.
>
>Naturally, in these markets the few dominant competitors have the same
>product price since the margins are so thin - these companies make money
>on volume.
>
>It's only in niche markets (ie: specialty foods, etc.) that there's still a
>large
>number of companies, or in commodity markets (like milk) where the
>product cost is so low that freight charges make global distribution
>uneconomical, and you cannot reduce the product bulk (ie: freeze
>dry it) to reduce shipping But tires are very expensive and they are also
>very complex and take a lot of technology to manufacture.
>
>As you say, tires are competitive. And since there are so many many cars
>out
>there, there's huge amounts of tires sold. And since tires are complex and
>not
>easy to manufacture in the barnyard, the product lends itself to a commodity
>manufacturing model of single-source manufacture with wide distribution.
>But
>the reality is that the market does not appear to work this way. It seems
>to me
>that in reality, tires are far more expensive than they should be, because
>the
>tire companies have spent so much money on making hundreds if not hundreds
>of
>thousands of slightly different but almost the same model of tire. So you
>have
>a situation where there's a lot of small manufacturers all making small
>production runs,
>instead of a few large manufacturers making a few giant production runs.
>
>The situation seems really ripe for a well-heeled tire manufacturer to start
>acquiring
>other ones and killing off product lines right and left, and substituting a
>few
>much cheaper product lines, then making their profit on bulk. That is the
>pattern that has happened in the past in most other commodity industries
>with
>this kind of product, and the only reason I can come up with that it hasn't
>happened in the tire industry is that all of the tire manufacturers have
>gotten
>together and formed a secret cartel of some kind to fix prices.
>
>Is this it? Or is there something I'm missing about the tire market that
>lends
>itself to this incessant brand fracturing.
>
>Ted
>



--
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  #20  
Old December 31st 07, 10:36 PM posted to rec.autos.makers.chrysler,alt.autos.gm,alt.autos.ford,alt.autos.toyota,rec.autos.makers.honda
Bill Putney
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Posts: 2,410
Default Price fixing among tire manufacturers

Ray O wrote:
> "Bill Putney" > wrote in message
> ...
>> Ray O wrote:
>>
>>> The UTQGS was developed to provide a uniform method of comparing tires,
>>> and since mileage ratings are not part of the grading system, tire makers
>>> have and use mileage ratings for "wiggle room" in their marketing.

>> You're saying the mileage ratings (400, 620, or whatever) are not part of
>> the UTQG? UTQG is only temperature and traction ratings?
>>
>> Bill Putney
>> (To reply by e-mail, replace the last letter of the alphabet in my address
>> with the letter 'x')

>
> The uniform tire quality grading system has a treadewear rating with a
> control tire assigned a rating of 100. A tire with a rating of 400 would
> have a tread life that is 4 times the control tire; a rating of 620 would be
> 6.2 times, etc. Mileage is not necessarily the same as treadwear due to
> differences in tread pattern and tire circumference, so rather than list
> expected mileage, they compare tread wear.


Ahh - got it. When you say mileage, you mean when they state that "this
is a 75,000 mile tire". Thanks.

Bill Putney
(To reply by e-mail, replace the last letter of the alphabet in my
address with the letter 'x')
 




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