Brazil
Antonio M. Capellini has been named as the new Chairman and Managing Director of Goodyear India. Capellini previously headed Goodyear commercial OE operations in Brazil. He replaces Luis Ceneviz who is moving to Goodyear in Australia.
Ford’s Excursion 4×2 and Super Duty F-250 and F-350 Models will run on Pirelli Scorpion STRs as OE fit in 2003. Powertrains are at the heart of doing what SUVs and trucks are designed to do. A wide range of engines give these vehicles incredible power and torque, including the all new 6.0-litre, turbocharged, Power Stroke V8 diesel. Pirelli’s Scorpion STR is designed to cope with the torque and towing potential. The LT265/75 R 16 radials will be available with either black sidewalls or raised outline white letters. The Pirelli Scorpion STRs destined for 2003 Ford Excursions and Super Duty pickups will be manufactured in Pirelli’s factory in Brazil. The technical specification of the STR includes the combination of steel belts and nylon wrap for which Pirelli is famous, being the core technology behind Pirelli’s high-speed performance tyres. Tyres will be shipped to Ford assembly plants in Louisville, Kentucky and Cuautitlan, Mexico and vehicles produced will be distributed in the U.S., Canada and Mexico.
In the United States, analysts UBS Warburg have downgraded Goodyear stocks from “Hold” to “Reduce” and the price target per share from $8 to $5.50. The analysts accept that the company’s sales performance overseas is improving, but Goodyear is struggling in the US and the analysts cite five reasons why it might be difficult to make further progress in this market.
Goodyear has published its results for the third quarter. Net income more than tripled to $33.7 million (3Q 2001: $9.3 m), while worldwide sales were down slightly at $3.5 bn ($3.7 bn). Currency movements had an estimated $4 m negative effect on sales and $10 m on earnings. For the first nine months, Goodyear posted a loss of $0.6 million, compared with a loss of $29.6 m for the same period last year. Sales were down too, at $10.3 bn ($10.7 bn), while tyre volumes slipped 2.5 per cent to 160.7 million units. Sam Gibara said that economic conditions in key markets and rising raw material costs are a concern, but Goodyear will continue to concentrate on reducing working capital.
In August, North American industry shipments of consumer replacement tires were 8 percent below last year’s levels. Goodyear’s shipments of consumer replacement tires were also down and below the industry shipment levels. However, Goodyear’s shipments to its large wholesalers continued to improve in August. Shipments of custom brand tires declined significantly from August 2001 levels. Commercial replacement tires were up 18 percent from last year’s levels. Goodyear’s shipments of commercial replacement tires increased but were below industry shipment levels. European Union industry replacement tire shipments were down 1 percent for consumer tires and down 6 percent for commercial tires compared with prior year levels. Goodyear consumer tire shipments declined at the same rate as the industry and Goodyear commercial shipments were below industry shipments. In Eastern Europe consumer replacement tire unit sales for Goodyear were up significantly compared with August of last year. Volume gains were reported in most countries, especially Russia and South Africa. The Latin American market showed August replacement tire shipments were up primarily due to higher consumer sales in Mexico and Venezuela and strong commercial sales in Brazil whilst OE shipments were down significantly from last year due to a decrease in auto production in Mexico and Brazil. In Asia replacement tire shipments increased throughout the region in August whilst OE tire shipments declined from 2001 levels due to lower sales in China and the ASEAN region.
The European Investment Bank is evaluating a proposal to fund up to $39 million USD toward the modernisation of a Pirelli tyre plant in Brazil – Pirelli Pneus S.A. The Brazilian subsidiary has drafted a $136.6 million USD plan to add radial production capacity to its 25 year old plant in Feira de Santana plant.
Michelin is offering 100,000 employees worldwide the chance to become preferential shareholders in the group. Employees will be able to purchase shares until the end of April with a discount and they will have usual shareholder rights, including access to financial information sent by Michelin to its employees. The object is to strengthen the relationship between the company and its employees and to give them a stake in the group’s development.
Gajah Tunggal was established in 1951 to produce bicycle tyres and inner tubes. 20 years later production of motorcycle tyres began, followed in 1981 by car tyre production. Gajah Tunggal produced its first car and light truck radial tyres in 1989, and was listed on the Jakarta Stock Exchange in 1990. In the past ten years Gajah Tunggal has grown by acquisition of suppliers such as GT Petrochem, a producer of tyre cord and nylon filament, Langgeng Bajapratma, a wire manufacturer, and Meshindo Alloy Wheel Corporation. These developments linked to constant improvements in quality control, gaining ISO 9002 quality certification in 1995, along with TÜV Certification from Germany, helped create Gajah Tunggal as one of the leading tyre manufacturers in South East Asia. The Gajah Tunggal radial tyre plant gained ISO 9001 in 1997 and has also received quality certification from several countries i.e. E-Mark from the European Community, TÜV CERT from Germany, quality testing certification from the U.S. Department of Transportation, the BPS from the Philippines and a similar certification from the Government of Brazil. Currently Gajah Tunggal sources 36% of its raw materials from its subsidiary companies. Further vertical integration and synergy of its group activities to develop higher technology and higher value-added products, are a key policy in future development of the business operation. The company has entered into an off-take agreement with Pirelli to manufacture tyres for North America and Europe.
Goodyear has released details of the group’s performance in various markets, for the year to date, to end February. Brief details are as follows: North American Tire: February industry shipments of consumer replacement tyres were 8 per cent up on last year. Goodyear shipments to dealers were flat, as some dealers pre-bought at the end of last year. Goodyear shipped 400,000 tyres as part of the Ford replacement programme. Industry shipments of commercial tyres were 14 per cent up on last year’s levels. Goodyear’s shipments were up, but not as high as the industry figure. Industry shipments of OE tyres were up 10 per cent for car tyres and down 17 per cent for commercial tyres. Goodyear’s unit shipments outperformed the industry. European Union: Consumer replacement tyres: industry shipments + 3 p.c. Goodyear shipments lower. Commercial replacement tyres: industry shipments – 6 p.c. Goodyear shipments reflect this figure. Consumer OE tyres: both industry and Goodyear shipments up. Commercial OE tyres: both industry and Goodyear shipments down. Eastern Europe: No segmentation available, but Goodyear replacement tyre sales were up, due mainly to market recoveries in South Africa and Turkey. Goodyear OE tyre sales were down slightly. Latin America: Goodyear replacement tyre sales down, mainly in Brazil and Argentina. OE sales were up. Currencies in Brazil and Mexico were revalued, but this was offset by devaluations in Argentina and Venezuela. Asia: Replacement tyre sales were up from last year, while OE unit sales were slightly down. Improved volumes in China and India helped improve operating margins over last year.
Dr. Paolo Masera (60), who was MD for Pirelli in the UK for a short time and MD for Pirelli in Germany twice; the second time for only a few months, went to Brazil early in 2001. He now is back in Italy again to take over another leading position in Milan.
The ContiTech Group of the Hanover-based Continental AG closed 2000 as the most successful business year in its history and, for the first time, each of its business units posted a positive operating result. Compared to 1999, the company increased sales by 4.2 per cent to 1.79 billion Euro. In 2000 ContiTech generated 68 percent of sales with automotive manufacturers and 32 percent with industrial customers in the non-automotive sector. The operating result (EBIT) experienced a disproportionate increase of 6.8 per -cent to 139 million Euro.
The group’s turnover fell from US$ 3.66 bn (1st quarter 2000) to US$ 3.41 bn for Q1 this year. Last year the group achieved earnings before taxes of US$ 80.3 million; this has turned into a loss of US$ 48.2 million. Earnings after tax fell to a loss of US$ 46.7 million. Despite these poor figures, analysts – especially from Deutsche Bank – have confidence in Goodyear, which is based on the hope that the effect of the disastrous Firestone recall will create a big advantage for first brands, and is also based on the assumption that price increases will stick. Last but not least, Goodyear has said that its on-going restructuring programme will lead to further significant cost reductions.
Marangoni S.p.A. has started production of precured tread rubber at Belo Horizonte, Brazil, in response to Brazil’s growing demand for retreads. The purpose designed, 14,000-sq.-ft. plant cost Marangoni around 13 million Euro to build and equip. Initial employment will be 60, but this should rise to 140 over time, Marangoni said. The company expects the new venture to generate sales of 6.1million Euro in the first full year of operation, rising up to 25.6 million Euro within four years.
Bridgestone/Firestone Brazil’s former vice president of legal and government affairs has been promoted to the managing directors’ post upon the retiral of Vito De Florio on 1st October.
Watts Industrial Tyres (WIT), the UK market leader for industrial tyres, has signed a joint venture agreement with its Brazilian distributor to manufacture and distribute Watts brand solid tyres in Brazil. The company is ‘Souza Pinto Industria e Comercio de Artefatos de Borracha Ltda.’ and production begins this month at a new factory near Sao Paolo.
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