NCBR Article

Green Diamond Tire rolls into Northern Colorado
By Lara Williams


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.

August 29, 2008

 

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.  

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."

Green Diamond Tire rolls into Northern Colorado