Brazil
Dusseldorf based, Degussa AG has announced that it will increase the capacity of its carbon black plant in Paulinia, Brazil, to 100,000 tonnes per year. The company first announced this project in September 2004. Now that the management board has approved the plans, the way is clear for work to start immediately.
Pirelli’s Brazilian subsidiary of its Telecom systems business has signed a joint venture agreement with Japan’s Furukawa Industrial, to produce fibre optic cables in Brazil. The new company, to be called SPF (Sociedade Produtora de Fibras Ópticas S.A) is split 51:49 with Pirelli responsible for the majority. The decision to merge was taken in order to “catch all the opportunities that could derive from the recovery of the Brazilian telecommunications market after last year’s slowdown,” a company statement explained.
Bandag Inc experienced a 10 per cent increase in profits during 2004, Tire Review has reported. According to the magazine, Bandag 2004 results also showed a 5 per cent increase in net sales compared to its 2003 figures. During 2004 Bandag recorded sales of $854.2 million, compared with $816.4 million in 2003, and net profits of $66.9 million, compared with $60.2 million in 2003.
After the company only recently confirmed plans to build its 48th tyre factory in Brazil, Japan’s Nihon Keizai is reporting that Bridgestone will build two more facilities. According to the newspaper the new factories will be built in China and Eastern Europe at a total cost of more than £253 million. The Chinese plant will produce bus/truck and passenger car products in China and is likely to be built in Huizhou, Guangdong province. As for Eastern Europe, a number of locations have been the subject of media speculation. Possible countries include Slovakia or Poland where Bridgestone already has a tyre factory.
Hayes Lemmerz International, Inc. announced that its steel wheel manufacturing operation in Guarulhos, Brazil has received the 2003/2004 supplier award from Agrale, the Brazil-based truck, chassis, tractor, motorcycle and engine manufacturer. The award recognized Hayes Lemmerz as “The Best Supplier” of its commercial truck steel wheels. The recent quality awards received by this plant demonstrate that investment in upgrading the capabilities of the plant are paying off. “I am honored that Agrale has recognized our efforts to be an industry leader,” said Fred Bentley, President of the Company’s International Wheel Group. “The key to successful implementation of quality is having a team that truly practices Operational Excellence. Our team strives to provide our customers with the best products and service possible.”
Bridgestone Corporation has announced that it will invest $160 million in building a new tyre plant. The news follows initial reports from Brazilian newspaper and the Associate Press news agency that the Japanese company was planning to spend $700 million on the project. Confirming parts of the reports, the company said Bridgestone Firestone Brasil, a wholly owned subsidiary of Bridgestone Americas Holding, Inc, would build the plant in the Brazilian state of Bahia. Construction will begin in 2005, and plans call for the plant to begin production in the second half of 2006.
According to the company, Bridgestone Firestone Brazil’s new plant will produce tyres for passenger cars and light trucks. The company says the new plant will have an initial production capacity of about 8,000 tyres a day. It will utilise state of the art production technologies and is expected to create more than 500 new manufacturing jobs and 1,200 indirect jobs in the region. The projects will increase BFBR’s capacity by roughly 25 per cent the company said.
Brazilian car production reached 2,020,704 vehicles for the period between January and November, up 20.8 per cent from the first 11 months of 2003, reflecting the country’s robust recovery from a sluggish 2003, when the economy grew less than 1 per cent. The auto industry’s trade association is predicting an output of 2.2 million vehicles by the end of 2004.
Referring to the $160 million expansion plans, Jorge Gonzalez, president, Bridgestone Firestone Latin American Operations, said: “This substantial new investment is evidence of our optimism in the strength of the Brazilian economy and our belief in our Brazilian team-mates.” Earlier reports which, were later found to be inaccurate, had suggested that the company would be willing to invest an even greater amount.
The Associated Press new agency is reporting that Bridgestone Corp will invest $700 million (£364 million) in the construction of a new factory in northeastern Brazil, according to Brazilian news sources.
The company plans to build the plant in the state of Bahia because of strong expansion in Brazil’s motor vehicle production industry, the daily Valor Economico newspaper said. Bridgestone’s Brazilian unit had no immediate comment on the report. The company says it plans to invest $300 million (£156 million) in the first stage of the project alone.
Bridgestone’s existing factory in a Sao Paulo suburb produces up to 30,000 tyres per day. The Valor newspaper did not reveal details of the new plant’s production capacity, although it is likely that the new plant will be used to produce passenger car tyres.
Brazilian car production reached 2,020,704 vehicles for the period between January and November, up 20.8 per cent from the first 11 months of 2003, reflecting the country’s robust recovery from a sluggish 2003, when the economy grew less than 1 per cent. The auto industry’s trade association is predicting an output of 2.2 million vehicles by the end of 2004.
In its recently published third quarter results, Alliance Tire has announced a net profit of $102,000 for the third quarter of 2004, compared with a net loss of $1.66 million in the corresponding period last year. Although this period represents the company’s third successive profitable quarter, quarter-on-quarter figures show a slight drop in growth.
Compared to 2003, Alliance reports that sales grew 26.3 per cent to $29.7 million. In the second quarter Alliance’s sales totalled $31.6 million. The company’s export figures continue to show impressive levels of growth. Alliance’s export sales grew by 37 per cent to $21.8 million compared with the same time last year. Agricultural, multi-purpose and industrial tyres for export make up approximately 75 per cent of Alliance’s export. Local market sales increased 4 per cent to $7.9 million, a figure that represents 27 per cent of total sales.
In the first nine months of 2004, the tyre manufacturer reports that net profits grew to $3.7 million compared with losses of $8.3 million in the corresponding quarter of last year. In the same period, sales increased to $93.4m, an increase of 29 per cent compared with the corresponding period in 2003.
Alliance chairman Isia Tchetchik said the third quarter growth was hindered by the port strike that prevented sales of $1.9 million. Despite this, he said, the company managed to achieve positive results that prove that Alliance is experiencing an improvement in business performance.
Joseph Anglister, Alliance’s president, said the break-through in sales to Central and South America continued in the third quarter, in particularly in Brazil where sales doubled to $5.1 million in the first nine months of the year. The company president also stated that Alliance continues to implement efficiency measures, something that likely to prove useful in the face of rising raw material costs. According to Mr Anglister, production costs per ton of output fell 2.5 per cent to $2.38 per ton, while production increased 19.4 per cent, to 27,527 in the third quarter of 2004.
The TIA has inducted Mario Marangoni into the TIA Hall of Fame. At the beginning of November, during the SEMA show, the TIA made the award in order to recognise the company president’s “leadership and entrepreneurial ability.” As a company, Marangoni sees the award as an achievement that recognises the success of the Italian tyre industry in addition to its international business.
After a distinctly variable season, Michelin has ended the Formula 1 year on a high note. The BMW William’s Juan Pablo Montoya said a fond farewell to the team by winning the Brazillian Grand Prix.
Continental AG, is boosting its presence on the worldwide tyre market, having laid the cornerstone for a new tyre plant in Camacari in the Brazilian state of Bahia.
Goodyear Tire & Rubber Company has announced that Pierre E Cohade, formerly executive vice president of worldwide water and beverage company, Groupe Danone, will become president of Goodyear’s Asia-Pacific region.
Alliance has released its second quarter financial results, showing a second straight profitable quarter after a succession of 11 negative quarters. Net income amounted to $1.2 million, compared to a $1.1 million net loss in the parallel quarter of 2003. The figures also showed a 30 per cent growth in sales in the first half of 2004 to $ 63.7 million.
The International Tyre Club is to hold its 2005 meeting in Lisbon, Portugal from March 9-11.
Club secretary James Graham pointed out the reasons behind the decision: “Although recently we have concentrated on introducing the markets of Eastern Europe to our members we do not want to over-focus on these. Other areas of Europe offer just as much new opportunity and in Lisbon we will not just be introducing new faces from Portugal itself. We will be looking to the whole of Spain, South to Morocco & NW Africa and West to Brazil. All areas of equally fast moving potential.”
The ITC’s ‘summit’ style format provides an arena for trade discussions for its tyre and wheel business members.
Club events seek to foster new and mutually beneficial commercial links in regions offering the prospect of higher than average long-term potential. Both the Czech Republic and Hungary have hosted recent successful Club meetings.
Carlos Redondo has been Pirelli’s CEO for Latin America since the beginning of 2003. Before that he was CFO for Pirelli Tyres worldwide. With a turnover of approximately 1 billion euros, about one third of Pirelli’s total worldwide turnover Mr Redondo is successfully piloting his division from its headquarters in Sao Paulo. Tyres & Accessories met Mr Redondo last month in Usuhaia, south Argentina, in conjunction with the launch of its new Sottozero winter tyre. To download the whole article as a PDF file, click here.
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