Africa
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.
Capacity at Apollo Tyres’ South African facilities will rise by one fifth following a £12.9 million investment in its wholly owned Dunlop Tyres International (Pty) Ltd, South Africa (DTIPL) facilities in Ladysmith and Durban. “We are expanding the capacities of both the South African facilities by approximately 20 per cent during this fiscal at an estimated investment of 200 [million] South African Rand,” stated a senior Apollo Tyres official.
At present the combined capacity of the two factories is approximately 180 to 190 tonnes per day – a 30 to 40 tonne per d ay increase on levels two years ago. The majority of production is focused upon truck and bus radial products, with 15 per cent of capacity used to manufacture OTR tyres for the mining sector. These last products are mainly sold in Europe, Australia and South Africa.
Based in Otrokovice in the Czech Republic, Avex claims to be the world’s number one tyre storage rack manufacturer, as well as manufacturing racks and containers for the chemical, automotive and nuclear industries.
The company was founded in 1994 and currently employs some 245 staff. The production facility covers around 10,000 square metres and 75 – 90 tons of raw materials are used daily, giving a monthly output of between 10,000 and 20,000 racks, depending on the size and complexity of the products.
OTR tyre specialist Techking Tires came to the Reifen Essen show armed not only with new products, such as the 335/80R20 MPT (Multiple Purpose Tire) – the Chinese company brought news of impressive growth and numerous new programmes it is introducing. Techking marketing specialist Benjamin Zhang reported the latest developments to T&A.
“We have set up six private meeting rooms for existing and new customers at our stand,” he said. “For the whole week they are always busy.” This is hardly surprising considering Techking’s explosive growth during the past few years. Evidence of this can be seen from the fact that in 2006 Techking had 5 tyre specifications. Today it has 140, in 20 individual patterns. All tyres are manufactured at the company’s 35,000 square metre Dongying, Shandong Province factory, which was built in 1994.
Amongst Techking’s new offerings for 2008 are combined tyre and rim combination packages. “This has come as a result of customer feedback,” explains Mr. Zhang. “Customers asked for a tyre/rim package. It is easier for us to choose the right rim for a particular tyre.” The Techking marketing specialist reported that the building of a new 330,000 square metre factory for manufacturing OTR and TBR rims is currently in progress, The facility is due to be completed at the start of 2009 and within three years a capacity of 50,000 to 70,000 pieces per annum is planned.
Also new is Tire Watch, Techking’s TPMS project initiated last year. Testing for the Tire Watch project will continue until July and its market introduction is not far off. Tire Watch, Mr. Zhang explains, offers real time monitoring of tyre pressure. A third new product from Techking, introduced this year, is Tire Armor, protective chains for loader tyres, that can be easily damaged on rocks. “New items such as Tire Armor show we not only provide products; we also provide solutions,” said Mr. Zhang.
Yet another significant development for Techking is the introduction of the TSC – the Techking Service Center – Techking is building showrooms in conjunction with local partners in key markets and will provide training to local dealers. The TSCs will offer maintenance services and advice on correct tyre choice, while enhancing the Techking brand image in various local markets. “We have chosen Europe, Africa and Australia as the markets in which to begin rolling out the TSC concept, as in these regions we have stronger partnerships with local dealers,” Mr. Zhang added. The first TSC is scheduled to open in July 2008, and in addition to these centres the company continues to visit its global partners on site. In 2007 Techking representatives visited 50 such partners in various countries.
Techking tyres are sold in approximately 55 markets around the world, with Europe, South Africa and Australia the strongest. European sales account for 25 per cent of the total, Mr. Zhang comments, and currently South Africa is the market undergoing the fastest growth. A new market for Techking is Russia, and it is one that, says Mr. Zhang, presents its own challenges: “It is a different situation from our traditional key customers. The market in Russia is mostly for bias tyres, radials are only being introduced. In Russia we provide potential customers with our ‘Fuel Save Technology’ programme, which includes statistics on the fuel saving benefits of radial tyres.”
On the topic of world markets, much has been said recently about the US decision to impose duties upon Chinese manufactured OTR tyres. While Mr. Zhang confirms the duties charged on Techking products are not as high as for some other Chinese based manufacturers, he admits the US remains a smaller market for the company.
After conquering numerous world markets, Techking is now making itself at home, in its home market. In a situation that is completely in reverse to most Chinese manufacturers, Techking, a traditionally strong exporter of radial products, has only very recently launched its products onto the domestic Chinese market. “Most Chinese mining companies still use bias tyres,” Benjamin Zhang explains. “Most sales in China are for overseas brand equipment. We hope this situation will change soon but realise it takes time to adopt radial technology.” Even more amazingly, in April 2008 the company that has for so long embraced radial technology launched a range of bias OTR tyres. “The first tyres produced after heavy involvement from Techking will serve OE manufacturers in the domestic market,” stated company president Tech Wang in a Techking newsletter. A company representative further comments on the decision to introduce this older technology. “We are not in pursuit of high volume. We feel that giant bias OTR is a necessary supplement to the market at the moment.”
The testing of such new giant OTR tyres, like all the Techking range, can be performed on the company’s drum test machine, which can test up to 63-inch tyres; Techking is the only Chinese manufacturer to have such a machine. And in terms of tyre development, the process at Techking is very customer centred, adds Mr. Zhang: “Techking collects research and development feedback from different markets, and develops custom products for key markets, such as the 29.5R29 ETNT for Canada or 35/65R33 ETNT for Australia.”
In the last decade or so the off-road tyre market has seen a name appear, seemingly out of nowhere, and grow to become a significant player in many markets, particularly in Europe. That name is BKT, or Balkrishna Tyres. The Indian company, flagship business of the large Siyaram Poddar Group, has only been producing tyres for two decades and exporting them for little more than one decade. Yet in a short span of time – between the 2000/01 and 2007/08 financial years, BKT’s annual sales have rocketed from US$8 million to more than $250 million. These are results many competitors can only dream of, but the company still holds even greater ambitions.
“Our vision is to obtain global leadership in off highway tyre solutions,” stated Arvind Poddar – vice chairman and managing director, Siyaram Poddar Group, at the Reifen Essen Exhibition. “I’m sure we will make it possible in the shortest possible time.” To achieve this, explains Mr. Poddar, the company has set itself the goal of maintaining its current growth rate of 30 to 35 per cent. This means sales of $325 million in financial year 2008/09.
A more efficient use of production capacity should see tyre output increase by 7 per cent this year at Belshina. The Belarus based company is reported to be planning an upgrade of its existing processing lines and the introduction of a new tyre assembly system. Its output of OTR tyres is also set to expand following the commissioning of an OTR radial assembly system supplied by the VMI Group. The system can accommodate tyres between sizes 17.5 R25 and 24.0 R35, although it will be principally used for manufacturing 21.0 R35 and 24.0 R35 size tyres suitable for rigid dumper applications. Belshina will reportedly increase output to just under 28,500 units per year, with 37 new sizes and types introduced by 2010.
Thailand based manufacturer and exporter of car and motorcycle tyres, the Vee Rubber Group, has disclosed plans to invest up to a billion Thai baht (£15.5 million) over a period of several years. According to the Bangkok Post, the company desires to increase its car tyre production output to better serve its export markets.
The first phase of the company’s expansion will take place by the end of 2008, when Vee Rubber’s factory in Samut Sakhon Province will reach a new monthly output level of 200,000 to 300,000 tyres per month, up from the current monthly output of 100,000 car and light truck tyres. Reaching this capacity will require an investment of 400-500 million baht (£6.2-7.8 million). The remaining money will, over the next two to three years, be used to further boost the factory’s output to between 600,000 and 700,000 tyres per month. All of the added tyre output will be for export, primarily to Asia, Africa and North and South America.
Boris Stevanovic has been appointed Goodyear Dunlop Tires Europe BV marketing director for truck tyres, and in this role will be responsible for the company’s operations in this sector within Europe. He takes over from Pietro Saletta, who moves to Italy and begins as the company’s European director of Consumer Tires.
Market-leader in independent tyre, accessory and equipment shows, ECI International has launched a newly overhauled website, eci-international.com.
The site features improved graphical presentation and the ability to navigate around the site with greater ease. Also available on the site is an array of information on ECI’s three forthcoming exhibitions: Tyrexpo Asia 2009 at the Singapore Expo Centre between 24-26 March 2009; Brityrex in Central Manchester (G-MEX) from 22-24 September 2009; and Tyrexpo Africa in Johannesburg during March 2010.
The company has also relocated its European office to Speldhurst Business Park in Kent.
Peter Becker, former senior manager at Goodyear Dunlop Germany, has been appointed Chief, Research and Technology at Apollo Tyres Ltd. He has formally joined the company this month and will be leading Apollo Tyres’ initiatives in tyre technology, research and new product development, especially with regard to European market needs. Mr Becker will be based in Germany, where he will be responsible for establishing an R&D facility for Apollo Tyres. He will be working with Apollo’s research, technology and design teams across geographical locations in India, South Africa and Europe. The company has previously announced plans for a 200 million euro passenger car radial tyre manufacturing facility in Hungary.
According to a company statement, the appointment forms part of Apollo Tyres Ltd’s ongoing plans for the European market. Peter Becker commented: “I am excited by this opportunity and impressed by the possibilities the future holds with Apollo Tyres. I am positive that we will be able to bring out competitive products which address customer needs.”
In August 2006 Bridgestone celebrated the delivery of five million run-flat tyres over the course of two decades; a mere twenty months later the company doubled this figure. On June 4 Bridgestone announced that it passed the ten million mark during April 2008.
Bridgestone says it recognises run-flat tyres as strategic products. The company also points to their environmental benefits, such as fuel economy through vehicle weight saving and reducing rubber consumption and scrap, and thus the company plans to further permeate and expand its run-flat market.
The first Bridgestone run-flat tyres were delivered in the early 1980s, the initial products being tyres fitted to specially manufactured vehicles for physically disabled persons. The first run-flats for a production vehicle model, the Porsche 959, were delivered in 1987. Bridgestone’s run-flat production has accelerated since 1999 as automakers have adopted run-flat specifications on a growing range of vehicle models, reflecting a changing environment surrounding motoring lifestyles. Currently the company produces run-flat tyres at six plants in four countries worldwide – Japan, the United States, Poland and South Africa.
The Pirelli Group is to increase truck and bus tyre production capacity in Egypt by 50 per cent through the investment of $65 million dollars in its Alexandria TBR plant. The announcement was made by the Chairman of Pirelli & C. SpA, Marco Tronchetti Provera, to Egyptian Trade and Industry Minister, Mohamed Rashid, on the occasion of the Italian-Egyptian inter-governmental meeting taking place in Rome. The new investment will allow the factory in Alexandria to increase its annual production to 1 million pieces and become the largest site for manufacturing radial tyres for industrial vehicles in the MEA (Middle East and Africa) area.
According to an official statement on the matter, the growth of production capacity will be focused on “the most advanced product and process technologies able to express maximum performance both in terms of the needs of emerging markets and with respect to the requirements of the main customers in Continental Europe.”
Continental Tyres has announced that it is to sponsor the 2010 FIFA World Cup in South Africa. According to the company, which also partnered the 2006 World Cup and is sponsoring this year’s European championship, the latest move is a continuation of its long-term marketing strategy based on football sponsorship, to deliver “huge global TV audiences.” Continental also has the option to extend its sponsorship to the 2014 FIFA World Cup in Brazil.
Continental has acquired the rights to promote the sponsorship of the 2010 FIFA World Cup worldwide and will link this to product communication. In addition, Continental has once again received a sizeable ticket allocation and premium hospitality, which has become an important cornerstone of its strategy.
“This sponsorship deal continues the marketing strategy we have been following since 1995 for all Continental tyre products and maintains our focus on football as a central communication platform for increasing brand awareness in our core markets over the next three years,” explains Continental Tyres UK advertising and sponsorship manager Tim Bailey.
On 22 May Bridgestone Corporation announced a string of senior management changes that mean Toru Tsuda has become the new Chairman, President and CEO of Bridgestone Europe NV/SA. Mr Tsuda is currently Vice President and Senior Officer Responsible for Products Development Tire Products Development.
Current Bridgestone Europe chairman, president and CEO, Takashi Urano, will become vice president and senior officer responsible for International Tire Business Operations. This role means Mr Urano will also be director Middle East, Africa, Russia, Asia, Oceania and China Operations Division; and concurrently general manager, Middle East, Africa and Russia Operations.
The management changes in full are as follows:
SRI Tire Trading, the tyre exporting company belonging to the Sumitomo Rubber Group, is to increase the export prices of its Dunlop, Falken and Sumitomo brand passenger car, light truck, truck and bus and motorcycle tyres in Europe, North and South America, Asia and the Pacific, Africa and the Middle East. Increases will be implemented gradually from July onwards, and will range between 5 and 15 per cent, depending on tyre type, size and market. The company, however, reports that most increases will be in the vicinity of 5 to 10 per cent.
The increases are due to, SRI adds, surging raw material prices, including those for rubber and crude oil. The company says the level of these increases since last year is now to great for it to absorb internally, and thus it must introduce this, its second price increase this year – a 3 to 7 per cent price rise was also announced in the first half of the year.
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