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With all the raw material cost increases being passed through and then some, Goodyear and Cooper Tire have been on FIRE.  GT is up 110% and CTB is up 80% in the past 6 months. 

 So, I wouldn't weep for all the tire makers.  Not sure what is going wrong at Kumho.  Could be currency exchange issues, or higher raw materials in Korea due to China's swallowing up the world, or maybe just bad execution.
 

SteveEkstrand:

  So, I wouldn't weep for all the tire makers.  Not sure what is going wrong at Kumho.  Could be currency exchange issues, or higher raw materials in Korea due to China's swallowing up the world, or maybe just bad execution.
 

 Or maybe price undercutting all the competition for years across the board is finally catching up? 

honda93:

I am a teacher, not a businessman, but if Kumho is to retain its place amongst the SCCA Solo community, you need to absorb any raw materials/production price increases within your "bread and butter" products. Most of the general tire-buying public won't notice a dollar or two here and there given the sales volume differences.

However, you need to lower the prices on the V710 and your other R-compound tires by the end of the 2007 season, or as I said earlier, I feel you will lose your stance amongst this loyal group of consumers. Anthony Crea

So, Anthony, next time your school district is strapped for cash, and they want to continue with the same high level of teaching staff, should that same staff absorb a pay freeze or perhaps a cut in pay?

Take your time.....

 I didn't think so. Price increases are a fact of life. As others have mentioned, material costs have gone up. Check with the Econ teacher at your school, betcha he could diagram this.

Not trying to flame, but asking Hoosier or Kumho to absorb those costs is a bit unrealistic.

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I think Anthony was joking...

I missed the or <J/K> or other indication of sarcasm. 

I think he's asking for Kumho to subsidize its race tire production by increasing its asking prices for its non-race tires. 

I agree with Matt, though (first time ever) -- the money's got to come from somewhere. 

PedalFaster:

I agree with Matt, though (first time ever) -- the money's got to come from somewhere. 

Frig. The Apocalypse is coming, for sure. 

mattm:

So, Anthony, next time your school district is strapped for cash, and they want to continue with the same high level of teaching staff, should that same staff absorb a pay freeze or perhaps a cut in pay?

Take your time.....

 I didn't think so. Price increases are a fact of life. As others have mentioned, material costs have gone up. Check with the Econ teacher at your school, betcha he could diagram this.

Not trying to flame, but asking Hoosier or Kumho to absorb those costs is a bit unrealistic.

Matt,

Thanks for the suggestions, but we've had freezes in our salary steps... just last year actually! It's one of the downsides of having the taxpaying public (of which I am a member) vote for my district's budget (an hence my salary). I accept this as part of my chosen profession because I admittedly vote the budget down in my own town. A lot of people would be taxed out of town if it easily passed each year.

Now back to the topic at hand...

I meant what I said and I appreicate everyone who has backed me up (or at least attempted to! )

The letter was a means of venting, but I feel there is truth to it regarding the fact that Kumho made their name not on RAW SPEED or GRIP like Hoosier has been known for, but on offering a product that could stay within a few tenths of Hoosier and do so at a price that made them a major player in this small niche market in a relatively short period of time. Now that they had to raise their prices (seemingly moreso on their R-compounds), I feel they will no longer hold onto that market advantage of having a product with a strong performance & longevity per dollar ratio relative to Hoosier. For what Hoosier offers in contingency (actual tires) I believe their business within the Solo community will increase while Kumho's decreases; this is of course pertinent to serious National competitors... For those who just want the experience of R-compounds there is always Avon and Toyo.

Also, yes, in my letter I basically asked Kumho to absorb the increases in all their other products, from their line of $30 "Pep Boy Specials" to commercial truck tires. Why should we take such a strong hit? Our market is admittedly small enough that as I said above, we are a loyal, but at the same time volatile, group of consumers. WE made Kumho what they are in this market because of their strong performance & longevity per dollar ratio that I mentioned above. Kumho should realize this and make some sort of "amends" to keep the SCCA community happy.

Unless of course they don't care, and we will return the favor by showing (through a loss of sales) that neither do we.

vwawd:

Looks like it's going to get the ST people as well. Tirerack just upped the Yoko Advan Neova AD07 by $19 in 245/40-17 to $229

 looks like the Yoko price change was a temporary blip. Its back now to the original price....wonder if I can get the difference back on the set that I purchased at the higher price :(

mattm:

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I think Anthony was joking...

I missed the or <J/K> or other indication of sarcasm. 

 

Huh. It appears that unfortunately he was not joking.  Anthony, you're not an economics teacher, are you?

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Huh. It appears that unfortunately he was not joking.  Anthony, you're not an economics teacher, are you?

No, I am a Special Education teacher. I have lots of emotionally disturbed, socially maladjusted, and conduct disordered students, but I also have the neurologically impaired (learning disabled) ones as well... Nothing hardcore like autism, however. 

Sorry if I came across as some economics specialist, but I'm not. I let emotion guide my logic here, not knowledge.

One thing I do know about business however, is that the almighty dollar reigns supreme and loyalty does not.
 

How about a nice apples-to-apples comparison?  I have plenty of old Tire Rack ads handy courtesy of GRM magazine, so let's have a look at one year ago:

• June 2006 issue (in May 2006 TR was still advertising A3S05)
  
• Kumho Ecsta V710
• 225/50R14:  $145
• 315/35R17:  $222
  
• 285/30R18:  $265
• Hoosier A6
• 225/50R14: $185 (+40 each)
• 315/35R17: $280 (+58 each)
  
• 285/30R18: $285 (+20 each)
  
• May 2007 issue
  
• Kumho Ecsta V710
• 225/50R14:  $156
  
• 315/35R17:  $243
• 285/30R18:  $287
• Hoosier A6
• 225/50R14: $195 (+39 each)
  
• 315/35R17: $294 (+51 each)
  
• 285/30R18: $300 (+13 each)

So prices have gone up across the board, more for Kumho than Hoosier, but the price differential had not really changed all that much for the same tire sizes.  However, the current website prices show a bigger price jump for some of theKumhos:

•  Current website price

• Kumho Ecsta V710
• 225/50R14:  $160
  
• 315/35R17:  $249
• 285/30R18:  $305
• Hoosier A6
• 225/50R14: $195 (+35 each)
  
• 315/35R17: $294 (+45 each)
  
• 285/30R18: $300 (-5 each)

 Also worth noting is that BFGs new offering fits neatly between the Hoosier and the Kumho in pricing.  It will be interesting to see how they perform and how long they last.

• BFG g-Force R1
• 315/35R17:  $269
• 285/30R18:  $294
  

Now I remember again why I drive an ES Miata instead of an AS Corvette...  ;)

Bret

64ES 

honda93:

One thing I do know about business however, is that the almighty dollar reigns supreme and loyalty does not.

And I wouldn't expect any company to do anything differently. It's the profit-driven market (greed-driven, if you want) that gives us improving tires and low prices. We're no different than any other customer, and there isn't any reason fro Kumho to do anything but try to make a nice profit from us. I'm not looking to Kumho to save us from the prices - I'm looking to Hankook. They offer a tire that's probably as fast as the V710 for less money - Kumho will need to either get faster or cheaper (either with contingency or purchase price) if the Hankook proves to be it's equal. The market will sort it out. Brand-loyalty doesn't really have any place here.