Is Continental Facing A Hostile Takeover Bid?
An article in the German magazine Wirtschaftswoche suggests that the Thyssen-Krupp group is planning a take-over bid for Continental. Whether or not this is the case, it throws up some interesting possibilities and our article analyses whether such a course of action is feasible and what it would mean to Continental. The article also examines what the effects would be on the European tyre market and how the big tyre manufacturers might react to such an eventuality. Should Thyssen-Krupp mount a successful bid, the chances are that it might decide that Continental’s tyre division is surplus to requirements. Given such a situation, the implications for companies such as Michelin, Bridgestone and Pirelli are enormous and the article explores the different scenarios that might arise from such a course of action and the defensive measures that the tyre giants might take. Is the Thyssen-Krupp bid a figment of the imagination, or an attempt to boost Continental’s share price? The article concludes that Continental is a tempting target for a takeover bid (by somebody) and that its recent strategy makes the group more defenceless than in the past.
Continue ReadingThird Blimp Crash Within A Year
In October last year the Goodyear blimp Spirit of Akron crashed in the Akron area. On August 10th a gust of wind damaged the gondola of the blimp Spirit of the South Pacific and on August the 20th the blimp Stars & Stripes crashed in Philadelphia. Nobody was hurt. Stars & Stripes, one of seven airships operated by the tyre manufacturer worldwide, will be rebuilt, says Goodyear. In the meantime, the company is examining other ways to fulfil its TV commitments, including hiring a blimp, helicopters and planes.
Continue ReadingAgain Price Increases for Rubber Blacks in Europe
Unprecedented crude oil and crude oil products have pushed production costs for carbon black ever higher.This, combined with the low value of the Euro have again led Degussa-Hüls AG to raise prices for rubber blacks to 40 Euro per metric ton. Prices effective from 15th November.
Continue Reading160,000 Tyres To Be Replaced By Continental
Continental General Tire will replace 160,000 Contitrac AS MXS tyres, size P245/75R16, of which 140,000 were mounted on Fords Lincoln Navigator and 20,000 were delivered into the aftermarket. The tyres were produced in the Mayfield factory (Kentucky/USA) between January 1997 and 11th week of 1998. In 62 cases faults have been revealed, some tyres have suffered tread separations in remarkably similar circumstances to the current recall of Firestone tyres: the incidents occurred in Saudi-Arabia, where Firestone tyres have been under scrutiny, and again a Ford vehicle – the Lincoln Navigator – was affected. Up till now it is known that two people have been hurt in accidents, which could have been caused by tyre defects. The Stock Exchange Responds Quickly To The Tyre Recall From Continental. Within a few hours, Conti-shares lost around 8 % of their value.
Continue ReadingThird Quarter Loss For Goodyear
Goodyear reported a net loss for the third quarter of $6.6 million and a net income of $109.1 m (Q3 1999: $3.3 bn). High raw material and energy costs were contributory factors. World-wide Q3 sales were $3.5 bn and sales for the first nine months of the year were $10.5 bn (1999: $9.3 bn). Before these figures were revealed, analysts – following a statement towards the end of September by Samir Gibara, describing a difficult outlook for the tyre industry – had widely expected Goodyear to break even at best.
Continue ReadingThe Tyre As Part Of A System
The tyre can no longer be regarded as an isolated part of a car but is integrated into an increasingly complicated network or system. Progress in electronics especially has been revolutionary and has enormous influence on the work of tyre technicians. The engineers have to think in systems and integrate the tyre into all parts of the motive power of the car. Between the two corners tyre wheel system and the engine, is a wide field which the car makers and their suppliers are exploiting step by step. Immediately next to the tyres are modules such as brakes, shock absorbers and axles. Around the tyre is the chassis. The producers of certain of these elements in the past developed their own product without contacting the producers of neighbouring chassis parts. They were driven by their customers in the car industry, who gave information about the performance of the product with the target that all the parts should be compatible. As development progresses, this becomes harder and harder. In the future the suppliers will be forced to cooperate one with another, in order to make the best possible technology available for the car.
Continue ReadingFinancial Markets Advise Care With Automotive Shares
There is unanimity amongst financial institutes that anyone with investments in automotive shares should be very careful of their investments. The coming quarter does not look too promising; BMW, Peugeot/Citroën, Porsche and Renault (particularly thanks to Nissans better than expected results), should hold their position, but there seems to be no end in sight to the decline at DaimlerChrysler.
Continue ReadingBMW Gives Goodyear The OK For Two EMT Tyres
BMW has given Goodyear the go-ahead for fitting EMT tyres to the Protection Models BMW 740iL and 750iL. Delivery commences this month.
Continue ReadingA New Name for Hofmann
The German Hofmann Werkstatt-Technik GmbH from Pfungstadt has been renamed. Now it is called Snap-on Deutschland Holding GmbH, Business Unit Hofmann Werkstatt-Technik. The address has remained the same.
Continue ReadingPhoenix Long-Term Ambitious
Phoenix, supplier to the vehicle industry, itself a tyre manufacturer many years ago and still specialising, though not exclusively, in rubber parts for the automobile industry, is not reaching its turnover and profit targets as quickly as planned. Air springs, an area in which Continental is also involved, however, promises to develop into a jewel for the group from 2001 and gives ground for hope of steep rises in turnover and earnings in the long term.
Continue ReadingFast Fit Offered By Mercedes
In this year Mercedes wants to establish a so-called Express-Service covering the range from exhausts to brakes. Within one hour customers utilising this special service are assumed to be on the road again.
Continue ReadingCooper Tire & Rubber Record Figures
Cooper Tire & Rubber, the US tyre and rubber manufacturer, announced sales of US$ 2.2 bn, which is an increase of 17% compared with 1998. Net income was US$ 135.5m. This figure is 6.7% up on 1998.
Continue ReadingUSA Replacement Tyre Market – Michelin To Raise Prices
Following price increases of between 3 and 5% by Cooper, Goodyear, Pirelli and Yokohama in the US market, Michelin is increasing its prices of passenger car and light truck tyres by 5%. Tyre manufacturers need a minimum price increase of 3% merely to compensate for the 8% increase in raw material costs (rubber, oil, carbon black).
Continue ReadingCooper To Raise Prices In US
An item in our News In Brief for 13th March suggested that tyre prices in the USA would soon rise. Since then, the Cooper Tire & Rubber Co. has announced price increases of between 2 and 5% for passenger and light truck tyres, effective mid-April. Increases in raw material costs were cited as the reason for the rise, which applies only to the US market.
Continue ReadingMichelin Germany: Record Investments but Reduction in Profits
In the 1999 business year Michelin Reifenwerke KGaA (workforce: 6,747) increased its turnover by 3.2 p.c. or approximately 100 million DM to 3.215 billion DM (1998: 3.115 billion DM). The largest part of total turnover was generated in the German market, where it rose by another 6.3 p.c. compared with the previous year to approximately 60 p.c. of total turnover. As a member of the international manufacturing combine, however, the German factory also supplies the distribution organisations of its European sister. In this Michelin Germany also showed a slight improvement. Total tyre production – measured in tonnes – rose by 2.6 p.c. Sales were up by 4.6 p.c. Michelin sold 8.8 p.c. more light truck and nine per cent more truck tyres in 1999. In winter car tyres in particular the company recorded significant sales growth over the previous year, partly due to the launch of the new products Michelin Alpin and Michelin Pilot Alpin. Our target for 1999 was the modernisation and enlargement of production capacity to improve our competitiveness, said Dr. Klaus Neb as spokesman for the management. In the course of last year the company invested a total of about 128 million DM in its five German factories and plans to make another significant investment this year in modernising and increasing capacity, especially in the truck tyre factories. Neb is convinced that these high investments will pay off. Although economic development will differ from country to country, we expect further growth in Europe for the year 2000. Read more in NEUE REIFENZEITUNG 5/2000.
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