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NCBR Article
Green Diamond Tire rolls into Northern Colorado
By Lara Williams
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DIAMONDS IN THE ROUGH - Rich Gostenik stands before stacks of Green
Diamond tires, which have industrial diamonds embedded in the tread of
recycled tires. Green Diamond Tire North America plans to relocate its
western e-commerce headquarters from Denver to Fort Collins by early
2009.
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August 29, 2008 –
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When Rich Gostenik
of Green Diamond Tire starts talking about his company and its product,
it's impossible not to feel the excitement. It isn't often you hear about
a product that is environmentally friendly, keeping thousands of tons of
waste out of landfills annually, while also improving upon the original
product from which it was made. What's especially exciting is that
Northern Colorado soon may be able to claim as its own this green-minded
company.
Green Diamond Tire North America plans on relocating its Western and
e-commerce headquarters from Denver to Fort Collins by late 2008 or early
2009. It's even possible that the company may site its new factory in the
area in the coming few years, according to Gostenik.
So, what makes Green Diamond Tire special? It is currently the only
company in the world that recycles radial passenger and light truck tires
through remolding. The process reuses the casing of a tire (the most
expensive and resource-intensive portion) while rubber is reapplied to
create a tread exactly as it was on the original tire. Â
Green Diamond Tire's patented technology, which is licensed from a
company in Iceland, uses material embedded with thousands of small,
sharp-edged carbide granules, also known as industrial diamonds. Each
tire has between 2,000 and 3,000 of these manmade diamonds in the tread.
According to Gostenik, these carbide granules actually bite into ice and
snow better than studded tires. But Gostenik is quick to emphasize that
the tires aren't just meant for snow, and offer superior performance
year-round.
The tires must be broken in to expose the carbide granules. After driving
around for 1,000 to 2,000 miles, they reach peak performance and the tire
treads actually sparkle in the sun.
"I've had people come up to me and say, 'I think you drove over some
glass'," Gostenik said.
Only top-quality tires from major U.S. manufacturers are recycled into
the new Green Diamond Tires. Small tire salvage companies collect these
premium used tires and bring them to Green Diamond's plant in tractor
trailer loads of 1,200 to 1,400.
Employees inspect each load and sort them for product that can actually
be recycled. About 80 percent of a load are rejected, and are typically
sent to a landfill.
Gostenik estimates that his division of Green Diamond currently keeps
about 70,000 tires out of landfills annually, for sales "trending
toward $22.5 million to $30 million." He predicts that annual sales
for Green Diamond North America could reach 2 million tires within 3 to 5
years, making a significant dent in the number of tires currently being
sent to the dump.
Accidental discovery
Gostenik stumbled upon the product about 6 years ago while looking for
tires for a sports car he had recently rebuilt. At the time he was
working for a software company in the Denver area. He had found many
references to the product on Internet sites and he became interested in
the performance claims. At that time the product was being imported from
Sweden, and was extremely hard to get. Shipments were sold out before
they even touched ground in the United States.
Once he was able to obtain the tires and try them out, he knew what all
the fuss was about.
"The sense of security is unlike anything you've ever felt
before," he said, adding that they actually provide better traction
than studded snow tires but don't damage the roads so drivers can use
them all year.
One thing led to another, and before he knew it, in late 2004 Gostenik
had left his software job and acquired the wholesale distribution rights
for the western United States as well as the national e-commerce
business. In 2005 Green Diamond Tire's first U.S. factory came online in
Elmira Heights, N.Y.
"It really was the perfect storm," Gostenik recalled. "I
mean, where else can you find a product with a small carbon footprint
that actually improves upon the product from which it was made, that
costs less than competitors, and everyone needs them times four?"
The value proposition is not lost on Gostenik's customers. While a name
brand, premium 16-inch snow tire is likely to cost between $130 and $140,
a comparable Green Diamond Tire will run about $125, according to
Gostenik. Multiply that times four tires and customers save between $20
and $60 when outfitting their vehicles with Green Diamond Tires.
Gostenik is rightfully proud of the product he has helped bring to market
here. "People order the tires as Christmas gifts for their
children," he said. "I get e-mails every week from people who
want to be dealers."
Northern Colorado good fit
Gostenik believes the Fort Collins area, with its commitment to
environmental stewardship, is a good fit for his company's green product.
His five-year plan includes first relocating the headquarters to the
area, including the Denver warehouse operations. No local site has been
selected, but the company is aware of a number of existing spaces that
might fit its specifications.
Gostenik said that this could happen as early as the end of 2008, but
most likely will happen next year, bringing up to 50 or 60 new
"green collar" jobs to the area, primarily in sales and
marketing positions.
"Everything we do and touch in Fort Collins will demonstrate that
we're good environmental stewards" Gostenik said.
And he emphasizes that the new factory, wherever it's built, will be the
most modern and environmentally responsible in the world for Green
Diamond Tire and will raise the bar for all manufacturing facilities.
Site selection has already begun for a second manufacturing plant, with
Northern Colorado under serious consideration, along with Washington,
Oregon, Montana and Wyoming. In order to optimize manufacturing and
distribution, future corporate plans include a Midwestern distribution
center and a manufacturing plant somewhere in Canada.
For the short term, however, Gostenik is focused on growing the company's
retail distribution, through a combination of large chains like Big O,
and smaller, independent companies. He's concurrently soliciting private
investors, mostly from Northern Colorado, to fund upgrading the New York
factory to produce 300,000 units annually, up from the current 200,000.
According to Doug Johnson, director of UniverCity Connections in Fort
Collins, "Green Diamond Tire is a compelling opportunity for our
area for a couple of reasons. First, it's a high-quality manufacturing
facility that means jobs. Second, it's an environmentally friendly
technology that keeps tires out of the landfill and that incorporates
technology appropriate for our seasonal driving conditions."
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