St. Marys Journal Argus
With an eye to equip as many vehicles as possible in Ontario with winter tires, a new company called Green Arc Tire Manufacturing has made a deal with the Dana corporation to establish what will be the largest tire “remanufacturing” facility in Canada on James Street South in St. Marys.
Green Arc COO Mike DiCenzo, speaking to the Journal Argus Monday morning, said the company plans to employ about 340 people in the immediate term, producing just under 2 million tires per year. But he stressed the true weight of this week’s announcement on southwestern Ontario’s economy lies in the potential tied up in the Green Arc business plan: Over 4 million tires annually, and 1,250 jobs in the production facility, management, logistics, and the pick-up and delivery of used tires to the St. Marys plant from trucking companies, repair facilities or other suppliers.
DiCenzo, with experience in both the retail and manufacturing sides of Ontario’s tire sector, says he was joined by an associate in devising the Green Arc business plan. He says it includes state-of-the-art technology currently in use by Marangoni Meccanica of Italy. Modern “tire remoulding,” he adds — including smaller-scale factories already in operation in Quebec and New Brunswick — involves retaining the intact interior casings of existing tires, subjecting them to “MRI-style” testing to ensure they’re suitable for re-use, then manufacturing replacement tread and sidewall.
“All waste will be sent out immediately to the collection facilities supported by the Ontario Tire Stewardship program,” he said, when asked about the potential for a stockpile of unusable tire material. “Our purpose isn’t to accommodate scrap on site. It’s not in our business plan, and it’s not a liability we want to take.”
Financing for the Green Arc business plan, he says, was secured through a number of Canadian sources, including Phoenix Capital Partners and Bancorp Financial. DiCenzo described how he and his associate were able to provide assurances to the investors that the approximately $37-million plan to repurpose the former Dana factory would be sound business.
DiCenzo says that, after being pursued by municipal officials in Brantford, Brampton and other centres, he came to recognize St. Marys as a strong contender.
“The location is ideal. To find a building of that nature was something we felt very fortunate about,” he told the Journal Argus. Advantages included rail service, a property size that can accommodate growth plans, and the availability of a skilled workforce within the vicinity both for the production side and other aspects of the business.
Plus, southwestern Ontario represents a ready market for tires. “Your backyard is ideal,” he commented.
Was that enough, however, for the Bay Street suits? To hear DiCenzo tell it, the big break came when the Ontario Safety League came calling.
Having approached the provincial government with a request for tax rebates for motorists with snow tires, the Safety League was told by a spending-averse Ministry official to approach DiCenzo instead. The Ministry knew about his goals.
Along for the ride on that Safety League visit to the Ministry was a representative from Desjardins Insurance. That company is among insurers who offer rate discounts for users of snows.
It all adds up to a massive untapped market in Ontario for affordable snow tires, DiCenzo argues. And, with modern remoulding — of the type Green Arc is bringing to St. Marys — he says that’s exactly what could soon emerge from the end of the James Street South production line. The Green Arc news release claims a cost of production 30-50 per cent below the cost of conventional tire manufacturing.
“The affordability is the key,” the Green Arc COO said simply, about the attractiveness of the concept to prospective investors.
An official announcement of Green Arc’s purchase of the Dana plant was scheduled for today (Wednesday, Nov. 13) at the Toronto offices of the Ontario Safety League. Also expected to be in attendance were Minister of the Environment Jim Bradley and St. Marys Mayor Steve Grose.