Have Tread, Will Shred

Emanuel Tire Co. has been collecting, reselling, and shredding scrap tires for 45 years, establishing itself as a leader in the tire-recycling field.

By Robert L. Reid
Robert L. Reid is managing editor of Scrap.

If loose lips can sink ships—as those old World War II posters warned—the right conversation when overhead by the right person can also launch a successful recycling business.
   That’s how Norman Emanuel got the idea for his tire recycling operation, Emanuel Tire Co. (Baltimore), which today has five locations in three states, handling some 17 million passenger-tire equivalents annually. Recently, the company marked its 45th anniversary. But back in 1957, Norm Emanuel was just a 19-year-old kid working at the Chevrolet plant in Baltimore.    One day, he overheard a man in the company cafeteria telling how he’d built a $27,000 home with money earned from selling tire casings for retreading. Inspired by that idea, Emanuel called a local Firestone dealer the next day to ask if he purchased tire casings.
   Intrigued by the dealer’s offer of $3 a tire, Emanuel went out and bought eight casings from a local garage for 25 cents each. Though Emanuel still had a lot to learn about grading old tires—the dealer only bought three of his eight casings—those three earned him $9 for his $2 investment.
   After a quick lesson in proper tire grading from the dealer, Emanuel went out the next day, removed the back seat from his 1941 Chevy, and crammed the car full of old tires. This time he was more successful, selling 30 of 31 casings.
   “I got $90 that day,” Emanuel recalls, “compared to my normal take-home pay for the week of about $86.”
   The following day, Emanuel collected two loads of old tires and sold 91 of 93 casings. “I went to work that day—and quit!” he says. “That’s how it all began.”
   For the next several years, Emanuel and a relatively small work force handled old tires out of a Baltimore garage with no electricity and no telephone. As business grew, the company moved several times before settling in 1970 at its current home on Moreland Avenue, near central Baltimore. Even then, Emanuel Tire had just five employees and little equipment—whole tires could simply be landfilled at that time. But in the early 1970s, rumors started spreading that whole tires would be banned from landfills, as eventually happened. So Norm Emanuel bought his first shredder in 1978, becoming only the second person in the United States to shred used tires, he says.

An Industry Leader
Today, Emanuel Tire is one of the country’s leading tire recyclers, with only a handful of larger competitors, says Mark Rannie, vice president. The private company, owned wholly by Norm Emanuel, has 130 employees at five locations—70 in Baltimore; 25 at its facility in Conshohocken, Pa.; and 35 at its three plants in Virginia, located in Appomattox, Waverly, and a recently opened site in Lorton.
   From that single shredder in 1978, Emanuel Tire’s equipment base has grown to roughly 40 shredders—a $20-million investment in processing—as well as some 900 trailers spread out over a multistate region to collect used tires. Old passenger tires form the bulk of this material, followed by truck tires and off-the-road (OTR) tires, a category that ranges from farm tractor tires to the enormous tires on earth movers and other heavy equipment.
   On the selling side, Emanuel Tire’s shredded rubber chips are used in a variety of applications, including:
• civil-engineering projects such as landfill drainage layers and backfill in highway embankments;
• tire-derived fuel (TDF) in industrial boilers;
• rubber reclaim industry material (RRIM). In this case, crumb rubber processors further grind Emanuel Tire’s shreds into material for asphalt rubber, cattle mats, floor tiles, athletic surfaces, and other uses;
• drainage fields in commercial and residential septic systems; and
• niche markets such as highway sound barriers, playground safety bedding, and horse arena footing.
   Eventually, Emanuel Tire hopes to offer colorized rubber chips as a form of commercial or residential mulch for planting beds, gardens, and other landscaping needs.
   The company also sells passenger and truck tires in good condition for reuse, both domestically and internationally, and certain truck tires for retreading. (There’s no longer a retreading market for passenger tires, Rannie notes.) 
   Emanuel Tire also recovers steel from its tires in the form of tire rims, the bead or cable that holds the tire to the rim, and the steel belting inside the rubber itself. The firm sells this steel, which represents only a small portion of its overall business, to ferrous scrap processors in its operating areas.

Rolling on In
Though the bulk of Emanuel Tire’s business is concentrated in Maryland, Pennsylvania, and Virginia and neighboring states, the company has collected tires all along the eastern seaboard—from Canada and Maine down to Florida—as well as westward to Oklahoma. Likewise, it routinely sells whole tires for reuse in Latin America and has sent tire shreds and reusable tires as far as the United Kingdom, Africa, Russia, and China.
   The Baltimore plant is currently Emanuel Tire’s largest facility, processing some 6 million tires annually. The Pennsylvania plant comes second at roughly 2.5 million tires—with an expected doubling of that capacity within the next year or so—followed by 1.5 million tires at Appomattox, another 1 million in Waverly, and at least 1 million expected for the new Lorton facility.
   In addition, the company handles material at old tire piles or landfills in various states that can add a million or more tires at a time to the company’s total volume. These tires are often processed with portable equipment, without being sent through any of the firm’s five plants.
   Emanuel Tire collects its tires from four main sources. The leading source is its network of 900 trailers at customer sites throughout its operating region. The 40-foot-long trailers—which can hold up to 1,200 tires each—are usually sited one per customer, though large accounts can merit additional trailers. These customers include tire-generating facilities such as garages, large automobile service chains, local facilities of major tire manufacturers, even car-dismantling yards and scrap processors that accept whole cars—any place that generates a large volume of old tires.
   Emanuel Tire has eight tractor trucks to ser-vice its 900 trailers. In addition, the company has eight straight trucks—its second major collection method—that pick up tires from customers, especially those in urban locations where siting a large trailer isn’t feasible. These smaller trucks can bring back loads of 500 to 750 tires at a time. Together, these trailers and trucks—along with some contracted haulers—collect the bulk of the company’s scrap tires.
   The third collection method, which accounts for about 25 percent of Emanuel Tire’s volume, involves a kind of peddler trade—so-called “tire jockeys” who collect used tires from their own accounts and bring them to one of the firm’s facilities. 
The fourth method involves the company’s tire cleanups at various locations. Though certain projects can provide a short-term, significant influx of tires, these cleanups are generally not a major part of Emanuel Tire’s collections.

Sorting and Shredding
When Emanuel Tire collects a load of tires from a customer or when a tire jockey makes a delivery, the company charges a tipping fee—either to the tire generator itself or the tire jockey. This market-driven tipping fee is the major source of whatever profit Emanuel Tire makes from handling the old tires since the company sometimes loses money on the actual sale of tire shreds once all the processing and transportation costs are factored in, explains Norm Emanuel.
Thus, while scrap metal operators often claim that “you don’t sell scrap, you buy it”—meaning that the real profit comes from making good deals when you purchase your feedstock—Norm Emanuel is more likely to stress that “you don’t sell scrap tires, you process them.” By that he means that a tire recycler needs to watch his processing costs as much as possible because there’s little money in the end-markets for his products.
   Upon arrival at an Emanuel Tire facility, scrap tires are immediately sorted into two categories—those that can be resold for reuse or retreading and those that must be shredded.
   Only about 10 percent of the tires that Emanuel Tire collects are suitable for reuse or retreading. The company sells reusable tires individually or in sets from a retail operation at its Baltimore headquarters. Bulk loads of reusable tires are stacked in tall, interlaced piles to be eventually delivered either to customers or to Emanuel Tire’s nearby 3-acre warehouse, from which the equivalent of about 100 shipping containers a year are sent to export markets. Trailerloads can also be picked up by customers directly from an Emanuel Tire facility.
   At the Baltimore plant, however, most tires are destined for shredding. As such tires arrive, employees immediately load them onto a conveyor that feeds the first of several shredders. Here, the tires are chopped into 2-to-4-inch pieces that still contain some steel wire, which is fine for Emanuel Tire’s civil-engineering markets. For markets that require smaller rubber chips—say, 1-inch in size—with no wire, the company has a second series of shredders that further reduce the chips. The resulting material is well-suited for the fuel and RRIM crumb rubber product markets, Rannie notes.
   In addition to the main and secondary shredder lines, Emanuel Tire runs two independent shredders in Baltimore, which each make 2-inch-nominal chips suitable for civil-engineering uses or further processing. The firm also uses a 54-inch shear to reduce large OTR tires to manageable chunks.
   More than half of Emanuel Tire’s 40 shredders are operating on any given day, with roughly eight of them located in Baltimore and the rest spread out at other company sites. The firm also operates mobile shredders that can move from location to location—two were recently dispatched to the new Lorton facility—or else process material at a distant landfill.

New Market, New Equipment
The need to reduce processing costs is so vital to the success of Norm Emanuel’s company that he dramatically switched the primary market for his shredded rubber from TDF to civil-engineering material within the past five years.
   Though TDF once represented around 70 percent of Emanuel Tire’s sales of rubber chips, the material had to be shredded to a smaller size than civil-engineering material. That meant more wear-and-tear on the firm’s shredders. Plus, fuel chips often had to be shipped farther than material for civil-engineering projects, increasing the company’s already-high transportation costs. Moreover, making fuel chips produced an unusable residual that had to be landfilled—at Emanuel Tire’s expense.
   In the end, Norm Emanuel realized, he was actually losing money by producing TDF chips.
   By contrast, civil-engineering material can be made quickly and easily, with less wear on the shredding equipment. As a result, TDF has fallen to just 10 percent or so of Emanuel Tire’s rubber- chip markets over the past five years, with civil-engineering markets taking its place.
   Though consumers of civil-engineering chips don’t pay as much for the material as TDF consumers, the overall savings in processing, maintenance, and transportation makes civil engineering a much more attractive market, Emanuel says. Indeed, he declares, “Without the civil-engineering market, Emanuel Tire wouldn’t be the size it is now.”
   In addition to shifting his markets, Emanuel hopes to cut costs by reducing the amount of maintenance and downtime required by his shredders. He’ll do this by retrofitting his existing shredders with a special knife design that he’s developing and by building his own shredders from scratch when he needs a new machine. The problem, as he sees it, is that current commercial shredders force processors to choose between models that cut well but require a great deal of maintenance and models that don’t cut as well but require less maintenance.
   Emanuel hopes that his proprietary knife design will eliminate much of the current maintenance and knife changes required on commercial shredders, changes that can add up to as much as two hours a day of downtime. He also wants to make the knives uniform from machine to machine to make it easy to interchange parts. While even this knife design won’t always give him the greatest cutting efficiency, he’s counting on the benefits of interchangeable parts and greater uptime for to more than compensate.
   A half dozen of the new shredder knife designs should be operating at Emanuel Tire plants by year’s end, he says, with the rest available within two years. Reducing those maintenance costs and adding the saved production time—which could mean $250,000 a year in combined savings for each shredder—“will be our big move toward survival in an industry where I can’t get any more money for my product—in fact, I’m getting less,” Norm Emanuel says.

Seeking a Voice
Trucks arrive throughout the day at Emanuel Tire’s facilities, where employees roll whole tires deep within trailers or front-end loaders fill them full of tire chips.
   Product quality is one of the company’s strongest selling points, Norm Emanuel says. On the whole-tire side, quality involves properly identifying which tires truly can be reused and which must be shredded. On the shredding side, quality means giving the customer the correct size of material, with no more wire than the customer can use.
   Emanuel Tire’s quality commitment takes an ongoing effort throughout the company. Screens and magnets on all the shredder systems help with sizing and metal recovery. Maintenance crews at every site make sure the cutting equipment is running efficiently. (In Baltimore, Norm’s brother, Chris, heads that maintenance effort.)
   The quality commitment also means solving problems quickly when they do occur. “Quality is my Number 1 thing,” Norm Emanuel stresses. “I don’t want anyone to get a load from us that has something wrong with it.”
   Understanding what the customer needs is another key to providing quality material. To that end, Emanuel Tire—which recently joined ReMA as part of the new Scrap Tire Processors Chapter—is working on a consumer/processor task force to help develop new standards and specifications for handling the rubber-encrusted steel extracted from recycled tires.
   The Scrap Tire Processors Chapter was formed last year by a merger between ReMA and the former National Association of Scrap Tire Processors, of which Emanuel Tire was a founding member. Mark Rannie, president of the new ReMA chapter, hopes that joining a larger association will give scrap tire processors “a voice at the table” in local, state, and national discussions on scrap tires.
   Such a voice will be a welcome relief to scrap tire processors, who often find themselves pulled in multiple directions by government regulators, Norm Emanuel says. In the 1980s, for instance, his company fought a lengthy battle with Baltimore city officials over the storage of tire shreds—despite having accepted the city’s used tires free-of-charge for disposal for decades.
   And even when one state has a program that helps processors—Emanuel praises Virginia’s scrap tire program and especially its administrator, Alan Lassiter, as a “model for the nation”—a neighboring state might adopt policies that make it nearly impossible for the industry to compete, such as opening up a strip mine for free dumping of whole tires. This makes it hard for tire processors to plan ahead and even harder to consider expensive capital improvements, Emanuel states.

A Matter of Trust
Despite such difficulties, Emanuel Tire remains a vibrant, growing company. It recently expanded its Virginia operations to the new site in Lorton. The company’s Pennsylvania plant will soon double in capacity and could someday rival the Baltimore headquarters in size. Norm Emanuel’s shredder knife design should be in operation soon—just in time to chew up tires from new trailers that are being spotted around the region every week, with another 200 or so expected by year’s end. New markets are being identified or developed, with new products such as the colorized rubber mulch expected out soon.
   The company’s success depends on many factors, of course, including its commitment to quality, product diversification, industry savvy, and hands-on ownership—Emanuel himself is out in the yard, grading tires every day, Rannie notes. But there’s also another less-tangible factor involved—trust.
   Without much marketing or advertising, Emanuel Tire has built a customer base that, in some cases, has stayed with the company 25 years or longer, Norm Emanuel says—and that’s something “that only comes from people trusting you.”  •