Africa
Joseph Rosen has been named president and chairman of Goodyear Dunlop Tires North America Ltd. In his new role, Rosen will be in charge of the joint venture that was formed in 1999 between Goodyear Tire & Rubber Co., and Sumitomo Rubber Industries. The venture employs 1,350 workers at its tyre manufacturing facility in Tonawanda, New York and its corporate headquarters in West Amherst, New York.
Formed in 1976, the Al Dobowi Group was established to serve the growing Middle East tyre management industry. From its Dubai base, Al Dobowi Group is now involved in a range of operations (from tyres to equipment) on four continents – they even produce specialized battery components at a factory in the UK. With over 1100 employees all round the world, and some very interesting expansion plans in the offing, Tyres & Accessories recently met with executive director Harjeev Kandhari and found out more about what these will mean for customers.
One of the first things Harjeev Kandhari mentioned in conversation with T&A was that group companies are increasingly focusing on solutions, rather than just products. When you consider the wide variety of related business areas Al Dobowi operates in, this corporate philosophy really makes sense. But in order to explain what this might mean for customers a little background information is required.
Apollo Tyres’ announced expansion plans have been augmented by the appointment of a new chief financial officer. Mr. Salil Gupta, formerly group CFO at Dentsu India, will in his new role oversee the organisation’s finance, taxation and accounts functions – Apollo states that his primary objective is to contribute to the organisation’s financial health and stability, ensuring full compliance with statutory guidelines and the company’s corporate governance policies. His responsibilities also include an advisory role to the company’s legal and secretarial functions.
A shared tax threshold for imported products is hampering Sameer Africa’s efforts to expand, the Kenyan company claims. The manufacturer of the Yana brand of tyres says that the common external tariff protocol, agreed upon in 2005 by the East African Community Customs Union, has led to a flood of new and retreaded tyres from markets with lower production costs. This tax, applicable on new commercial vehicle tyres, currently stands at 10 per cent; previously tax rates between 25 and 35 per cent were employed to protect the viability of local manufacturers.
Hankook Tire has announced second quarter sales of 1117.2 billion won (£557.8 million), a year on year growth of 27.5 per cent, and 11.5 per cent quarter on quarter. Operating profit, at 79.0 billion won (£39.45 million), was 2.4 per cent down on the second quarter of 2007; likewise, recurring profit, at 89.8 billion won (£44.84 million) was also down 2.4 per cent. The quarter operating profit margin was 7.1 per cent.
Hankook reports sales revenue was boosted due in part to a weakened Korean won and an increase in tyre prices implemented in response to rising raw material costs – the company comments the tyre industry is facing increased pressure from a 24.3 per cent year on year increase in raw material costs, with natural rubber prices alone rising 40.5 per cent year on year. More than half of tyre production costs are now attributed to raw materials, adds the South Korean manufacturer.
Strong overseas performance, particularly in emerging markets, has enabled Goodyear to report record second quarter sales. During the three months to June 30, the tyre major generated US$5.2 billion in sales, a 6.5 per cent improvement on the previous year. Goodyear comments that this stronger result was achieved through improved pricing, a richer product mix and the impact of favourable foreign currency exchange. These factors offset lower volume sales in Europe and North America. Also impacting results, says Goodyear, was the 2007 divestiture of the company’s T&WA tyre mounting business, which had sales of $186 million in last year’s second quarter.
Zimbabwe’s sole domestic tyre manufacturer, Dunlop Zimbabwe, states it remains committed to continuing local operations. The company, now 100 per cent owned by Apollo Tyres, has maintained a presence in the country for 45 years, and its CEO, Mr. Kennedy Mandevani, states it will be guided by “business rationale” and won’t close up shop in Zimbabwe for political reasons.
The Zimbabwe government owned Herald newspaper quotes Dunlop Zimbabwe as saying it will “not join the multinational companies’ crusade against doing business in Zimbabwe.” An article published on July 28 specifically points to UK and US influenced multinational companies, including Tesco and Barclays, as pressuring local subsidiaries to cease operating.
Gareth Passmore has taken over Continental’s marketing operation in South Africa, having been shifted from his post as head of sales and marketing for the Middle East, Near East and North Africa region.
Passmore, originally from Wales, stated that his personal motivation behind the move was to seek out a new challenge for his career, to “experience a new way of life in a different environment” and to be in South Africa during the 2010 football World Cup, an event that the company is sponsoring. Having experienced Conti’s involvement in the 2006 tournament in Germany, Passmore is looking forward to the challenge of helping to develop the sport’s popularity in a country where Rugby Union and Cricket share the nation’s sporting enthusiasm.
Georgia’s Eastland Tire has created an Australian subsidiary and hired Martin Fester as its vice president of sales and marketing for Australia, Southeast Asia, Africa and the Middle East.
Eastland, earlier this year, signed a deal with Titan Tire to buy Titan-produced 57- and 63-inch radial OTR tires.
“The creation of Eastland Tire Australia and the hiring of Martin are significant steps in our goal of becoming a best-in-class supplier of OTR tires on a worldwide basis,” said James Berresse, Eastland president and CEO.
“Australia, Southeast Asia, Africa and the Middle East have vast and significant mining operations and we anticipate filling a portion of the OTR tire needs for the companies with operations in these parts of the world especially in the 40.00R57, 53/80R63 and 59/80R63 tire sizes though our agreement with Titan.” (Tire Review/Akron)
The Lone Wolf Transglobal Expedition made full use of the Cooper Discoverer Super Traction Tread on its 12-month trip of 30,000 miles in the wide variety of conditions present in 32 different countries. The success of the team brought lavish praise for the rugged Discoverer, which with its STT shod the crew’s Land Rover Wolf Defender. So much so, that the organisers of the successful expedition will be looking to Cooper Tire & Rubber Company once again to carry them through their next adventure.
The 12-month Lone Wolf trip saw Daniel Moylan and his crew tackle mud, ice, snow and water without a hitch Varying terrain was made all the worse by extreme temperatures, providing a demanding test not for the vehicle, the tyres and the team. The expedition made its way through Europe to Iran and the Middle East, across the jungles of South East Asia, to the USA and South America, before arriving back in the UK.
Remy International Inc. appointed Jesus “Jay” Sanchez as president of the company’s Electrical Aftermarket business unit.
Sanchez had been managing director of the Arvin Meritor Light Vehicle Aftermarket business in Europe and South Africa.
Sanchez is a graduate of Marquette University, Milwaukee, Wis., with a degree in mechanical engineering. (Tire Review/Akron)
Dunlop, the last tyre manufacturer with a factory in Nigeria, is set to leave the country, favouring the importation of tyres from other nations such as South Africa. The decision is said to be inspired by the persistence of power cuts, unreliable gas supply, a rise in manufacturing costs and inconsistent governmental tariffs, which allowed imported tyres to gain the upper hand in the domestic market.
The company stated that it had reached an impasse with the Nigerian government, after failing to persuade it to alter the prohibitive tariff structure. The government said that local manufacturing could not meet the market demand, though Dunlop argued that the current tariffs, coupled with energy costs and unreliability, made the improvement of production capacity impossible.
Anyone who attended the Essen show will have noticed how dramatically the marketing messages propagated at the show appear to have ‘evolved’ from seemingly polar positions.
Asking certain companies what their policy was in relation to aromatic oils and low rolling resistance tyres four years ago resulted in quizzical looks and stifled smiles. There may have been a few companies ahead of the game on this issue, but in general it was all about size, speed and profile. Now this remains undeniably influential, but the ‘product narrative’ has changed completely. Today’s tyres save fuel and last longer than ever, apparently.
As global consumer markets feel the pinch from the credit crunch, one can’t help wondering how long it will take the Chinese manufacturers to catch up with ‘green’ eco-technology. However, there remain both distributors and manufacturers alike that are sceptical as to the sales value of the green message. Do consumers really buy tyres because they may save them fuel?
Pirelli Tyre CEO and European Tyre & Rubber Manufacturers’ Association (ETRMA) president, Francesco Gori, spoke on a related subject during the opening ceremony. In his speech Dr Gori was “perfectly frank” in his references to planned EU directives that will require tyre manufacturers to improve wet grip performance, material authorisation and road noise properties. By way of a warning, he pointed out the consequences these regulations could have on European producers, particularly in comparison with their Asian competitors. Despite the looming threat of legislation and the cost pressure caused by rising raw material prices, the consensus from Reifen visitors is optimistic – 20.2 per cent are even expecting a strong upward trend in the economic growth of the tyre sector, this compares with 12.2 per cent who predicted this in 2006.
As far as the exhibition itself was concerned, with 20 per cent more exhibitors than last time and 17,600 visitors, Reifen Essen has obviously received the green light from the tyre trade. In fact, according to data released by Reifen show organiser Messe Essen, the 25th Reifen exhibition was actually a record breaker. 576 exhibitors (up 21 per cent on 2006) showed their tyre, wheel and chassis technology-related products and services. Visitor numbers totalled 17,600 compared with 17,100 in 2006.
Messe Essen reports that the show was also more international that ever, with 57.4 per cent (2006: 45%) of visitors originating from outside Germany. “That is an excellent value; it highlights the position of Reifen as the leading international fair in the sector,” Dr. Joachim Henneke, Chairman and CEO of Messe Essen commented. International visitors primarily came from other European countries (78.9%) and from the Asian region (11.1%).
Visitors from “the tyre trade” accounted for 34.4 per cent of show traffic, while another 26.8 per cent reportedly worked in the tyre service side of things. 51.1 per cent of visitors described themselves as amongst the top decision-takers in their companies (2006: 44.7%). Seemingly as a result, 42.1 per cent of the visitors placed orders during the show and 42.5 per cent stated that they wanted to conclude contracts after the fair. Nearly all the exhibitors (97.5%) said they had reached their intended target audience.
Keith Jarman, President of AME International, was one particularly positive exhibitor: “Our international business would not be where it is now if this fair had not existed. In spite of the worldwide economic difficulties, the tyre industry is doing fine from a global perspective. Because of the dollar exchange rate, it is absolutely sensible to be here.”
Jean-Claude de Thibault de Boesinghe, Sales & Marketing Manager for EMEA of Bandag AG, echoed this sentiment: “Reifen has gone very well for. We always concentrate all our activities on this fair and meet our dealers from Europe, the Middle East and Africa here. On a large, open booth, we have shown the newest products and technological innovations. The first day was already very busy and the second even better.”
Technology solutions company TechPlus of Saudi Arabia has unveiled its new Tyrelock safety band system. The device, which the company claims is fail-safe, takes the form of an aluminium strip placed around the tubeless tyre wheel rims of buses and heavy motor vehicles, covering the wheel’s shaped recess, or “well”. As a safety feature, it functions by preventing a tyre from being dislodged from the rim in the event of a burst or puncture, helping drivers retain control of their vehicles.
You don’t have to look very far these days to encounter news about Zimbabwe. A steady stream of grim reportage and chilling images are fed through television, internet and print media, all conveying the same basic message that things aren’t what they should be in this troubled African nation. And in addition to the much talked about violence and political issues, conditions for business are, to put it mildly, dire.
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