Slight Rise In Turnover For Goodyear In Third Quarter
Goodyear Tire & Rubber has announced worldwide sales in the 3rd quarter of $3.7 bn (Q3 2000 = $3.6 bn). Net income for the same period was $9.3 million, compared to $17 m for Q3 last year. For the first nine months of the year, the company posted a net loss of $29.6 m, compared to net income of $142.3 m for the equivalent period in 2000. Sam Gibara spoke of a general economic slowdown and tough market conditions in many regions. However, one plus point for the company was a market share gain of 3 per cent in the US replacement tyre market.
Continue ReadingAnalysts Recommend Michelin Shares As A “Buy”
Cheaper oil prices and the result of the Firestone recall in the US make Michelin shares a buy, according to analysts from the Deutsche Bank. Despite weakening demand in the US - the worlds biggest tyre market – Michelin is gaining market share and selling more tyres than ever. Market observers believe that it will be possible to obtain better prices for tyres in the region of 3 to 5 per cent.
Continue ReadingThe French Connection: Arc-en-Ciel
The French tyre trading network Arc-en-Ciel claims to be the largest European chain of independent tyre dealers. In 1986, there were only twelve members, but this has grown to a network of 850 outlets in Europe, 386 of which are in France. Every year, 20 new members join the group, it is claimed. In France alone, Arc-en-Ciel distributed around 2.9 million tyres in 1999, with the group holding 11% of the car/van tyre market, 9% of HGV and 18% of the agricultural tyre market. The Arc-en-Ciel branding is memorable – the name means rainbow in French – and this is carried over to a range of own brand products, which, of course, includes tyres that go under the name Eurotyre. As Arc-en-Ciel spreads across Europe, its strength increases. In addition to the French network, the group has a presence in six European countries, including 71 depots in the Benelux and 168 in Spain. Further expansion is envisioned in Portugal and in eastern Europe. Besides its fast-fit operation, Arc-en-Ciel has introduced a 24-hour replacement tyre service for hauliers in 14 European states.
Continue ReadingNo Recommendation For Goodyear Shares
UBS Warburg have placed Goodyear shares on Hold and is of the opinion that under current conditions a price of 15 dollars would be justifiable, per share. This figure is much lower than the current 25 dollar price. Goodyear shares in the past 12 months have fluctuated between 29.50 and 15.60 dollars.
Continue ReadingMore Action For Bridgestone
The beleaguered north American division of the Bridgestone Corporation is under yet another attack as a Philadelphia law firm has filed a class action lawsuit in Nashville accusing the company of stock fraud. The lawyers claim that the firm misrepresented its fiscal viability to stockholders by concealing claims against them in the ATX tyre failure episode. Further, the firm failed to disclose the cost of settlements and of replacing tyres. The law firm is seeking involvement from all investors who bought Bridgestone stock between March 31,1998 and August 31, 2000.
Continue ReadingMichelin Plant In Trier/Germany In Question
The Michelin plant in Trier where the Group produces wire and bead core has come under the microscope. The management is guaranteeing 300 jobs out of the present 330 for this year only and is raising the question whether or not production of wire etc. is still a core business.
Continue ReadingMMS Annual Poll 2000/2001: German Tyre Retailers Have Missed Their Targets
In the German tyre retailing business, the mood has swung towards the negative side over the last year. This is the main result of an annual poll carried out by the Marketing + Management-Systeme (MMS) among 2,400 German tyre retailers. According to the MMS-report, 80 percent of tyre retailers have been disappointed in their economic expectations. Among the co-operation members this is even higher at 85 percent. The main reason for the depressed mood has been the disaster of the winter tyre business in 2000 and there is no sign of any compensation in the form of new business activities. For 80 percent of the companies questioned, their central goal is to improve their service quality during this year. One year ago 30 percent of the retailers had stated that their expectations had been more than fulfilled, for 49 percent the expectations had been fulfilled. This time there are just three percent for whom the expectations have been more than fulfilled and another 17 percent who had achieved their aims. The most serious problem is the high quantity of winter tyres in stock. They block the capacities for the coming summer tyre season and cost a lot of time and money. First calculations are that 28 percent of the winter tyres have been not sold, which means a volume of five million units. With an average worth of 85 DM this adds up to an amount of approximately 400 million DM up to 425 million DM.
Continue Reading$60 Million Investment For Nizhnekamskshina
Russias leading tyre manufacturer, Nizhnekamskshina, is to boost capacity by 2 million steel belted radial car tyres by 2002. There are also plans to create new truck tyre lines by 2003, to produce 17.5, 21.5 and 22.5 truck tyres for the domestic market. The $60 million investment is being supplied by a major Russian oil company and will see car tyre production rise to 7 million units, though overall output will remain at around 12 million.
Continue ReadingIndian Tyre Industry Threatened By Imports
The Indian tyre manufacturing industry may be under threat from cheap imports from China. The lifting of trade restrictions with China has already created trading problems for many of Indias smaller industries. Presently imports from China form only 2.87% of Indias imports, but the arrival of cheap, mass produced products from China has indicated the lack of preparedness of Indian industry to meet the new competition. Tyre manufacturing has been highlighted as a potential victim as businesses move from manufacturing to importing.
Continue ReadingBRV Meeting In Weimar – “The Future Used To Be Better”
The BRV invited its members to attend its annual meeting in Weimar, historically one of the most famous cities in Eastern Germany. BRV President Ludwig did not have only good things to talk about, as he believes that margins will fall even further and the tyre trade cannot afford more pressure on margins. He mentioned Michelin and Goodyear as brands sold to car dealers at prices which are unrealistic and, due to the fact that tyre dealers have not been successful in the fast-fit field, President Ludwig urged tyre manufacturers to give tyre dealers better buying prices than car dealers. The association also expressed concern that tyre manufacturers might establish direct selling contacts with big fleets.
Continue ReadingBusiness As Usual In South Africa – Ford And Bridgestone
In South Africa, Ford and Bridgestone/Firestone have announced that the split between the two companies in the USA will not affect their 50-year relationship. Ford SAs director of corporate affairs Craig von Essen said that the recall problem was a matter for the US companies and that, as far as the South African company was concerned, it was business as usual. Bridgestone supplies South African companies with ATX and R45 Wilderness tyres, manufactured locally. As well as Ford SA, it supplies tyres to BMW SA, Toyota SA and Nissan SA.
Continue ReadingRubber Producers Plan To Cut Output
Thailand, Indonesia and Malaysia – the worlds three biggest rubber producers – have agreed to cut natural rubber production by 4 per cent next year in an attempt to increase prices. However, traders are sceptical of the chances of success, saying that many rubber producers are small, private businesses which would be difficult to control.
Continue ReadingTough Time For Ford And Firestone At Congressional Hearing
Ford chief Jacques Nasser faced some tough questioning at yesterdays Congressional hearing into the Firestone tyre/Ford Explorer situation. Billy Tauzin, from Louisiana, revealed that one of the brands of tyre being used to replace the Firestones had a failure record nearly 25 times worse than the Wilderness. Nasser said that, if this was correct then well act on it. Tauzin also criticised BF Incs John Lampe of attempting to shift the blame on to Ford.
Continue ReadingWind Of Change At Goodyear
Changing climatic conditions are leading Goodyear engineers to develop tyres with greater levels of grip on wet surfaces. Precipitation levels in North America have risen dramatically in recent years, with figures climbing by as much as 15% in the US/Canadian border states. Elsewhere, storm levels have increased and seven hurricanes are expected this year. Goodyears chief engineer, Bill Egan says, Greater levels of grip on rain-slick roads can be engineered on the computer for real world conditions. Improving a tyres wet-traction capabilities is vital in these times of changing weather patterns.
Continue ReadingSecond Quarter Loss for Ford
Ford posted a second quarter loss of $752 million. Excluding a $201million charge attributable to the restructuring of Mazda Motor Corporation, the trading loss stands at $551 million. The cost of replacing the 13 million Firestone tyres more than accounts for that loss. The after tax expense of the tyre recall is expected to amount to $2.1billion. Our decision in May to replace 13 million potentially unsafe Firestone tires was an unprecedented action, said Jacques Nasser, president and CEO. Although were disappointed it resulted in a second quarter loss, it was the right thing to do for the safety and trust of our customers.
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