One of Australia’s oldest and largest tyre retailers looks set to close after an attempt to sell the business to a rival fell through.
Beaurepaires, a tyre retailer, fitter and repairer with 100 outlets across Australia, was founded in 1922 – more than 100 years ago – in Melbourne by Sir Frank Beaurepaire.
The retail chain is now owned by Goodyear Dunlop Tyres Australia, which is part of the US-listed Goodyear Tire and Rubber Company.
In September last year, the parent company announced a plan to the US stock market to “improve profitability in its Australia and New Zealand operations”.
Its plan involves moving to a “third-party distribution and retail sales model instead of a company-owned approach”, which the company explained would see it shed around 700 jobs, exit nine warehouse locations, and sell or exit approximately 100 retail and fleet store locations, understood to be Beaurepaires outlets.
A source, who requested to remain anonymous, told news.com.au that the company had been in talks to sell Beaurepaires to rival tyre retailer Bob Jane Corporation, but that the sale talks had fallen through.
“Bob Jane got offered to buy out all the stores,” the source said, adding that rather than buying the entire chain “they have chosen the select few that actually make money”.
News.com.au understands that some other Beaurepaires stores were converted to Goodyear Autocare outlets in the past year.
Neither Goodyear Dunlop Tyres Australia or the Bob Jane Corporation responded to questions from news.com.au about the acquisition talks.
The source added that the remaining stores in the Beaurepaires chain would be closed by April this year, a claim Goodyear Dunlop Tyres Australia has denied.
Lauren Voucatos, human resources transformation and communications lead for Goodyear Dunlop Tyres Australia told news.com.au that while the company had “begun to evaluate different scenarios for different parts of our business”, no final decisions had been made as yet.
In its US stock market announcement, the company said it expected to complete the changes to its Australian and NZ business by the end of 2024.
It estimated the local transformation plan would cost it US$55-65 million (A$84-99 million) before-tax, but that the changes would ultimately increase the income generated by its Australia and NZ business by US$50-$55 million (A$76-84 million) a year from 2025 onwards.
As part of the evolution of its tyre distribution to a third-party model, it was announced last September that wholesaler TyreMax would become the exclusive distributor of Goodyear tyres in Australia and NZ, while wholesaler and retailer National Tyre and Wheel would exclusively distribute its Dunlop branded tyres.
In a statement about the deal to the Australian Securities Exchange (ASX), the ASX-listed National Tyre and Wheel said it could accommodate distribution of the Dunlop tyres through its existing wholesale distribution business, including its warehousing facilities, and revealed that it would begin to distribute Dunlop tyres in Australia from this April.
But Ms Voucatos said that what the distribution changes mean for Goodyear Dunlop’s existing warehouses “hasn’t been determined”.
The plans for the Australia and NZ business are part of broader works the troubled company is taking to improve its profitability.
Following the September announcement, in November, the US parent company revealed the Dunlop tyre brand is up for sale.
This news caused National Tyre and Wheel to release a further announcement to the ASX advising that it was “seeking clarification” from Goodyear about the impact of any sale on its distribution deal.
In its original September statement about the local changes, the company said “the proposed plan remains subject to consultation with employee representatives” but it is understood the Australian Manufacturing Workers’ Union is yet to be consulted about the changes.