A worldwide shortage of rubber tires for off-the-road (OTR) vehicles spells good news and bright long-term prospects for a North Bay retreading plant.
By this October, Goodyear Canada officials hope to be cutting the ribbon on a new facility now under construction in a south-end industrial park.
The tire making giant is expanding its shop by moving it across town into a new and larger 80,000-square-foot space. The company has been a fixture on Gormanville Road for 21 years, but it has outgrown its 50,000-square-foot shop because of the global and Canadian demand for tires, especially from the mining industry.
The $8.5 million investment means security for its 50 North Bay employees over the next 15 years. That’s the length of the lease Goodyear Canada signed with CIR General Contracting, the builder of the facility on a 19-acre property.
The North Bay plant, Goodyear’s only such Canadian facility, retreads a wide range of tires for the construction, mining, forestry and recycling industries.
“We do tires up to 8,000 pounds,” says North Bay business centre manager Glenn Bennett. “It could be 130 inches in diametre down to 40 inches.”
Tire makers are scrambling to make new OTR tires, so using retreaded tires has become vital and economical for some companies. Not only are there big road construction projects in the North, Bennett says there’s “unbelievable business” over the last three years from the mining industry.
The new plant will employ Lean manufacturing principles, which includes minimal tolerance for waste. This creates a strong demand for improved performance and continuous flow of production. In the existing shop, Bennett says machines were installed wherever there was space and inventory was piling up between work stations.
The new layout will avoid a lot of wasted movement and production should increase by 20 per cent using the same number of people.
“It’s a lateral move across town for more production space with lots of room for expansion,” says Bennett, but nothing definite is in the works. “We’ve just outgrown the facility.”
Retreaded tires can run close to, or sometimes better, in performance than new tires, and at only 65 per cent of the tire cost, says Gary Blake, Goodyear’s Lean Six Sigma Champion, who is overseeing the North Bay expansion project.
He says there’s a tremendous amount of engineering and material invested in a tire’s casing. If it hasn’t been wrecked, a user can get two or three more lives out of it by putting a new tread on. This is more environmentally friendly and in North Bay’s case, it keeps about 8,000 to 10,000 tires annually out of landfills.
“Every tire we can retread keeps a vehicle running in this worldwide shortage," says Blake.
The company ships tires to more than 200 selected dealers across Canada, who sell them to the big miners, southern Ontario contractors, steel makers and waste management firms. In Northern Ontario, Royal Tire is their distributor serving many of the major mining companies.
Some tires are shipped west, but only for companies in support roles for the oil sands production. No tire manufacturers are retreading the big tires for the large earthmoving equipment and dump trucks.
Tire retreading is not a huge portion of Goodyear’s overall business, but there’s always growth opportunities on the horizon.
According to the Tire Retreading Information Bureau, 18.6 million retreaded tires were sold in North America in 2006 with more than $3 billion in sales.
The possibility of shipping internationally is being studied, but Goodyear has not firmed up any commitments yet. “Right now there’s more business locally than we can keep up with,” says Blake.