Continental boss Mirco Brodthage in an interview

Continental boss Mirco Brodthage in an interview

In the KFZ Wirtschaft interview, Brodthage takes a stand for specialist retailers, speaks out against “short-term successes” and reveals how the Semperit brand will be positioned from now on.

Automotive Industry: Mr. Brodthage, how was your start? Mirco Brodthage:
From my point of view very positive. I found an extremely well-functioning team here that is motivated and successful. I felt comfortable and in good hands here from the first second.

How did 2018 go?
2018 was a good year for us. Overall, summer business was satisfactory. Winter business went very well, especially because it lasted into this year. January, for example, was an extremely strong month. We benefited from the fact that we still had goods available.

“The more complex the business becomes, the more opportunities the specialist retailer has to demonstrate its competence.”MIRCO BRODTHAGE, CEO OF THE AUSTRIAN SALES ORGANIZATION OF CONTINENTAL AG

What goals are there for this year?
Our primary goal is to satisfy our customers. All other goals are downstream. And of course we want to continue to grow. I'm less concerned with quantitative growth, because this follows the quality of market development. We are not looking for short-term success.

What is your sustainable path?
A sustainable path always starts from customer needs. We serve the B2B market, not the end consumer. The B2B market is influenced by the end consumer. It is important to pay attention to the direction in which the market is developing and in which direction the customers are developing.

What are the essential requirements that specialist retailers place on you as an industry?
The process requirements are essential. Every company has enough to do to satisfy private and commercial customers. It is up to us to ensure optimal conditions in everyday processes. It must be easy to do business with us. Local contacts are important. The topic of logistics is also extremely important and, in my opinion, is becoming more and more relevant. We must be able to distribute every tire in Austria within 24 hours. This is a high requirement because item complexity has increased significantly and will continue to increase.

Is business becoming even more consulting-intensive?
Absolutely. It is becoming increasingly difficult for the end user to identify the correct tire for themselves. This is a huge opportunity for specialist retailers to fulfill their advisory skills.

Does the tire trade have a future?
Yes, in any case. Because it will become more complex. The tire itself is a technical and also a digital product. The tire pressure monitoring system was the first step. The next step will be for a tire to raise more than just pressure. With ContiSense and ContiAdapt, we have two technology concepts that enable continuous monitoring of the tire condition and individual adaptation of the tire's performance properties to current driving conditions. The greater the complexity, the more opportunities the specialist retailer has to demonstrate its competence.

“We have to be able to distribute every tire in Austria within 24 hours.”MIRCO BRODTHAGE

Was the TPMS used optimally by specialist retailers to demonstrate competence?
From my point of view, yes. I perceived that they started dealing with the topic late, but then very professionally. Nothing disruptive happens in our industry, everything is basically predictable. It was predictable that at some point the first vehicles with TPMS would appear on the farm. Ultimately, the tire retailer made very good use of the TPMS issue to demonstrate its service and service expertise. The specialist trade is tending to move away from pure product sales - the margin is getting smaller and smaller - towards services, where the profits are increasing.

Does that mean there is more to come in terms of service?
I think so. If in five or ten years we have tires that are digitally networked with the vehicle, then everything will become more complex and there will be more need for advice. The end consumer only sees a product that has practically not changed externally over the past few decades. But the quality has changed significantly.

Shouldn't the industry position tires more strongly as a high-tech product and finally get away from the unfortunate expression "low interest product"?
Undoubtedly. The end consumer is not really receptive to such messages. On average, he deals with such a product every four years. But interest is limited.

What should the industry focus on?
Security remains the essential factor, especially since it includes emotion. We have Vision Zero in the group, the idea of ​​accident-free driving. And that also includes the safety of the tire. The better the tire, the fewer accidents. These are emotions too. We try to establish communication through the tire retailer. We support you with documents and training.

How do you see the market situation in Austria?
I support the strategy of building an organization so that it is ready for any changes. There is de facto no pure wholesale trade in Austria anymore. Instead, hybrid customers who exist in the retail and wholesale sectors. Now you have to see where the journey is going. The retail sector has developed strongly, and that is quite a good thing. In recent years, wholesalers in Europe have outsourced their two core competencies: on the one hand, logistics and, on the other, sales. It was carried out via platforms.

The Semperit brand should be increasingly established among young people. How does that work?
We have found that the Semperit brand is significantly less well-known and renowned among young people than among older people. For example, we try to reach young end consumers via social media, who often have a completely different idea of ​​mobility, especially since owning a car is less often seen as a status symbol.

You received the VRÖ Silver Award in January. How important is such an award?
Very important. Because it is direct feedback from customers. It is important to us how our customers see us in order to continually optimize our logistics, our service, etc.

What impact will electromobility have on the tire business?
All mobility concepts of the future need tires. Our customers will have to change - keyword: low maintenance of electric cars - but they have been doing that for decades anyway.

Car dealership versus tire retailer: Will there be major shifts here in the future?
There used to be workshops, tire dealers and car dealerships. Two models have become very similar: workshop and tire retailer. We are set up accordingly: We have an area for car dealerships and one for specialist retailers.

The ÖAMTC 2019 summer tire test gave the Semperit Van-Life 2 a “not recommended” rating, “very weak in wet conditions, weak on dry roads”. How are you doing with that?
This was a van test for the first time; these are tires for commercial customers. The most important requirement for this clientele is longevity. This is about a conflict of goals that arises. Making tires is always a compromise. In this case, tires in the van sector were tested for significant safety properties and compared with passenger car tires. In any case, we take all criticism seriously. Our developers in Hanover work every day to make our tires even better.

What should retailers focus on?
I think the focus should be primarily on the processes. On the one hand, because of the convenience aspect, i.e. the end consumer wants this issue to be dealt with quickly and easily. On the other hand, it's about the internal processes because there are costs involved. Optimized processes save money. And: You have to show your consulting skills to the outside world. On the one hand in the external representation of the company, on the other hand online.