Pep Boys' buys Big 10 Tires of Mobile

MOBILE, Ala. -- Pep Boys, the national automobile repair chain, purchased Mobile-based Big 10 Tires on Thursday.
The acquisition means one fewer corporate headquarters in Mobile, and could result in the loss of administrative jobs in the area, as well as lucrative professional contracts for things like marketing and banking.
Big 10 Tires has 85 locations in the Southeast. It was owned by an affiliate of Boca Raton, Fla.-based Sun Capital Partners, which purchased it out of bankruptcy in 2009.
Pep Boys paid a total of $41 million for Big 10 and seven stores in the Seattle area not owned by the company. Mike O'Dell, chief executive officer of Philadelphia-based Pep Boys, said the "lion's share" of the money was for Big 10.
Big 10 was founded in 1954 and currently employs nearly 700 people. It has about 25 corporate employees in Mobile, according to Claudia Zimmerman, the Mobile Area Chamber of Commerce's director of economic development.
O'Dell said no administrative positions in Mobile have been eliminated, but many will be over the next year or so.
Some of the affected employees will be offered the chance to move to Philadelphia, while others might take jobs in local Big 10 service locations, O'Dell said.
"We'll work with each associate to make sure they land somewhere and are treated fairly," he said.
Local parts suppliers could also be losing out on some business. O'Dell said Big 10 stores get most of their parts from local dealers, whereas Pep Boys uses its massive purchasing power to buy at a discount straight from the manufacturer.
"We buy them at lower costs, and then we can pass the savings on to the customers," he said.
O'Dell said his company will convert Big 10 stores to Pep Boys in four stages. The Orlando area, which already has a big Pep Boys presence, will be first. Then Pep Boys will convert about 21 Big 10 locations in the Atlanta area, doubling the company's presence there.
In early 2012 the company expects to convert stores on the Gulf Coast, including those in the Mobile area. Pep Boys has not decided whether to convert stores in Alabama north of the Gulf Coast, and plans to conduct a brand survey before acting, O'Dell said.
Zimmerman said the chamber regrets seeing the jobs leave the area.
"With headquarters of companies, you get white-collar, good-paying jobs," she said.
"This is the world we live in today," she said. "In this economy, companies are constantly being bought and sold.