With a restoration in demand on the horizon, Nexen Tire executives say the corporate is poised for progress. Over the previous few years, main modifications have taken place to set the South Korean tiremaker on this path: First, the opening of its tech middle in Richfield, Ohio, in 2019. Then, hiring new blood to strengthen its workforce and shifting its HQ to Ohio. Add to that lunching a mixture of tires in common segments, and most significantly, no remembers in its historical past within the US, and Nexen executives imagine that the corporate is able to assist its sellers in any means they want.
“We’re totally populated in the entire United States,” says John Hagan, government vice chairman for Nexen Tire America. “With the availability chain points behind us, hopefully, we at the moment are aligned with our buyer’s expectations.”
To get an replace on the enterprise and what to anticipate sooner or later, we caught up with Nexen Tire executives final 12 months through the firm’s Nexen Journey Supplier Journey in Banff, Canada. Check out protection from that right here. Beneath, hear what Brian Han, CEO of Nexen Tire America; Reon Ky Kim, vice chairman of selling; John Hagan, government vice chairman of gross sales; and Jason Yard, director of selling, needed to say about how the corporate is poised for future progress.
Madeleine Winer, Editor, Tire Evaluate: There was a whole lot of transitions inside Nexen Tire North America. You talked about this led to the delivery of a brand new tradition. Are you able to describe what which means and what this appears to be like like for Nexen?
Do: After we moved from California, we had a very good system, however after we went into Richfield, it gave us the chance to carry youthful, vibrant folks into the group. We strengthened our workforce and elevated a whole lot of the assist capabilities basically, which interprets to our sellers getting higher response instances, higher communication, improved reporting, transparency… We give our sellers month-to-month reviews to indicate their exercise and the place they’re in comparison with the place we would like them to be. This assist is just about a report card, so we’re capable of do it faster and quicker.
MW: You additionally added a brand new CRM system, right?
Do: Yep. Now, we’re quicker to the market…we are able to see at excessive ranges what is going on on with totally different clients in several elements of the nation. It provides us the flexibility to react rapidly as a result of our gross sales workforce, in fact, is within the weeds. They need to be. However we are able to see traits and instructions that we use to strategize day-after-day on how we might be quicker and higher out there.
We do our damnedest to show round any requests from our sellers inside 24 hours. Some are extra complicated than others, so we’re not 100% profitable, however at the very least it’s a purpose that we attempt for. If one thing comes up from the sector, we collaborate after which we flip round and decide… Our clients are joyful that we’re getting again to them instantly on what we are able to do.
MW: Speaking about provide chain, I needed to ask about fill charges. How have you ever all seen these fluctuate in comparison with early within the pandemic to now?
Do: Ever since I joined Nexen, we all the time strived for 95% plus or minus two or three a given time. After which when the pandemic got here, we nonetheless weren’t at 90, 95, however we have been greater than the remainder of our opponents. We have been doing very properly till the availability chain bumped into delivery points, container points, after which we dropped. However now that it has handed us, we’re now constructing that fill charge again up and our goal is to get again as much as the place our sellers anticipate us to be. We’re doing every part in our energy to get again as much as the 95 p.c vary.
MW: What are a few of these stuff you’re doing to rise up to that vary? I do know Nexen opened up a producing facility within the Czech Republic round 2019/2020.
Do: For the US, Korea supplies 100% of our provide. The Czech plant is for OEM alternative within the European market.
Yard: The Czech plant opened up extra capability for Korea to assist provide the US market. It took the pressure off Korea [for the European market]. So, tires produced in Europe are bought in Europe somewhat than coming from Korea, giving Korea extra capability to provide within the US.
MW: Going into 2023, how are you all seeing demand amongst your sellers?
Do: We’re seeing and hoping that the demand will enhance. For those who take a look at Q2 and Q3 final 12 months, there have been no tires, after which there was a large inflow of tires. So, we requested: Is demand sluggish as a result of financial system and other people making an attempt to save cash? Or is it as a result of it’s relative to the variety of tires that every vendor bought pounded with during the last three months? There’s a whole lot of hypothesis, nevertheless it’s a little bit little bit of each. It ought to get well in 2023. That is a constructive signal.
MW: There have been a whole lot of worth will increase out there. Can you are taking me by means of your pricing technique and what the long run appears to be like like for Nexen?
do: Nexen’s general technique has all the time been simply to observe the market. We do not wish to be a frontrunner in worth will increase, nor will we wish to be a frontrunner in worth drops. For those who go take a look at the primary eight months [of 2022], all people was growing costs and we have been following alongside. Now you might have, with the demand being comfortable, a whole lot of Tier 3 and Tier 4 taking away surcharges of their container enterprise. Not that the freight has modified in any respect, however they’re simply wanting to maneuver quantity. So, we’re getting a few of that stress by means of all the opposite tiers on what is going on to occur subsequent. I nonetheless suppose we’ll go into this 12 months and keep the general costs, however there will likely be some challenges right here and there going ahead.
MW: Nexen lately launched the Roadian ATX. With the sunshine truck market getting extra segmented, how are you studying the sunshine truck market?
Do: Sooner or later, we’re positively wanting on the different niches, however actually our focus is the Roadian HTX2 and the ATX. The HTX2 is our first all-weather tire. After we launched it, it did quite a bit higher than we anticipated. Even with the sluggish demand and the general flooding of tires out there, we have been capable of do fairly properly on each tires to date.
Yard: Some modifications will include the totally different sizes as properly. Within the ATX, we’ll be popping out with extra sizes within the subsequent a number of months for it to suit extra CUV and SUV sizes. We’re increasing each tires so far as sizes go. We now have our bases lined with the HTX, the ATX, MT and even the GTX for SUVs. And, they’ve all been launched within the final three years, in order that they nonetheless have new know-how.
Kim: The CUV/SUV and truck phase is growing yearly within the US. Nexen Tire America and Nexen Tire Korea, we’re specializing in growing these classes primarily for the USA market… In our five-to-10-year plan, we have now some extra plans for this phase.
MW: Nexen’s OE enterprise has additionally grown within the US exponentially. How does this play a job in your strategic progress plan going ahead?
Do: It is key. I imply, on the finish of the day, when you take a look at what our OE fittings are particularly with Stellantis and a few of the Korean manufacturers like Hyundai and Kia… a whole lot of the brand new ones that we gained three, 4 years in the past at the moment are hitting the alternative market. For those who return and take a look at the place our progress has been from an OE chart, we’ll begin seeing these first replacements this 12 months in good numbers. We have seen some already, nevertheless it’ll actually transpire into good alternative numbers subsequent 12 months and the 12 months after. Our OE fittings have additionally helped with model imaging and advertising capabilities.
MW: I additionally needed to ask about the way you all are viewing the EV tire market. We have seen tire producers put out EV-specific tires. What would you like sellers to find out about how Nexen is addressing tires for EVs?
Do: We have been engaged on EVs for years. We began working with Canoo out on the West Coast, for instance, years in the past once they have been simply beginning up. We’re additionally taking a look at many various car platforms, and we have now a whole lot of tasks within the works. What we will do is take a specific tread sample and create a subset of EV tires that complement our present product line, which helps in model advertising and complexity. Our sellers need to cope with all this measurement proliferation out there. It helps them go to 1 sample, one product, and so they have the boldness of Nexen to promote it.
Any of the tasks that we’re engaged on within the EV market, we’re working carefully with the OE producers. We’re assembly the burden necessities of the efficiency traits, low rolling resistant targets, and many others.
MW: Geographically, through which areas does Nexen wish to develop? I do know the corporate has enterprise in Canada as properly, however how do you see your footprint increasing going ahead?
Do: Our progress has been within the works for the final three to 4 years, nevertheless it actually got here to fruition final 12 months the place we began getting traction with enhancing our distribution community all through the US. That is additionally with the assistance of a few of our bigger distributors who’ve acquired different firms and have introduced them into the mildew… So, in the event that they weren’t carrying Nexen, now they’re. Some parts like which have allowed us to develop at an excellent clip.
During the last couple of years, since we have now grown our distribution, we’re totally populated in the entire United States. The place we have to enhance on is growing our share of accounts with our sellers in order that we’re capable of increase. For those who take a look at the previous, the sellers have been prepared, and we weren’t. With the availability chain points behind us, hopefully, we at the moment are aligned with our clients’ expectations. So, we simply need to work on that and do a greater job of executing.
MW: Going off of that… when a vendor or service advisor is on the counter, how do you all need them to consider Nexen and the way would you like sellers promoting the product?
Do: Positively the warranties and the worth proposition that Nexen provides them versus our opponents. Us having no remembers within the US goes a good distance. Additionally, simply the general worth of what our tire can do in comparison with our opponents. They are often assured promoting it and know that it will not come again.
For those who take a look at the everyday store proprietor, they need the benefit of promoting it to the buyer, mounting and balancing with no points, little or no weights to steadiness—Nexen hits all these.
MW: I do know you all launched a brand new slogan in 2021: “We bought you.” So I am curious, how has that been obtained right here and what does that imply to you all?
Yard: I feel it speaks to the belief and confidence that sellers and clients have in our product. We get suggestions, and a type of issues we hear probably the most is Nexen tires keep bought. There is a confidence when sellers carry Nexen in that they are going to promote them and keep bought as a result of the standard is there. And if for some motive there is a matter, Nexen stands behind it. That goes proper into the phrase, “We bought you” it doesn’t matter what.
From the vendor standpoint, it stems from the delivery of how we talk to sellers that we bought you lined on all bases. That is what kicked it off and bought us going, after which that mushroomed into a world marketing campaign.