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Dow Moves to Maintain Long-Term Supply of SSBR

The world’s second largest chemical manufacturer, Dow Chemical Co., announced on June 11 that construction had begun on a new facility for producing Solution Styrene Butadiene Rubber (SSBR). This facility, located in the central German town of Schkopau, is scheduled for completion in the second half of 2008 and will have a production capacity of 60 kilotonnes.

SSBR is a key component in the manufacture of high-performance tyres, and according to Dow the substance is the rubber market’s fastest growing segment, with anticipated annual growth of five to six per cent over the next few years. To assure a continuing and cost-effective supply of the key raw components of SSBR – butadiene and styrene – Dow has invested in securing its own providers of these materials.

19th June 2007/by Tyrepress Editors

May Shipments Meet Expectations

RMA data indicates that replacement tyre shipments to dealers in May were up 1.1 per cent year-on-year (they were down 3.6 per cent in May 2006). According to Deutsche Bank analysts product mix was better in the month, as light truck tyre shipments were up 4 per cent, while passenger tyres were up 0.6 per cent.

As a result the financial analysts supported their earlier assertions that 2007 replacement tyre demand could track “well ahead of 2 per cent,” adding: “We continue to believe our 2007 Goodyear (Buy) and Cooper Tire (Hold) North American volume assumptions are conservative. Cooper is best positioned in our view to beat volume expectations, given over 40 million units of reduced capacity in the low-end tyre market.”

19th June 2007/by Tyrepress Editors

Credential to Upgrade Shredding Facility

In order to be ready for the upcoming opening of its £4.1 million cryogenic plant in South Wales, Yorkshire’s Credential Environmental has begun to upgrade its Breighton, North Yorkshire shredding facility. This site, along with the company’s facility in the West Midlands town of Wednesbury, will process scrap tyres into a format that allows them to be frozen with liquid nitrogen and crumbed at the new plant, and Credential wishes to ensure that no bottlenecks will occur in the entire process.

To have the shredding plants keep pace with the cryogenic plant’s 30,000 tonne per year capacity, Credential Environmental will spend £400,000 boosting capacity of the Breighton facility, which last year processed 15 million tyres and will be the main site the company uses for supplying the new plant. A major component of this upgrade includes the installation of two new £150,000 tyre shredding rotors, manufactured by Columbus McKinnon. Improvement to the plant’s infrastructure, including the building of new walkways and firebreaks, has also been planned.

18th June 2007/by Tyrepress Editors

Apollo Considers Expansion of Dunlop SA Plant

Apollo Tyres is planning a major capacity expansion at its Dunlop South Africa facility, Indian newspapers have reported. The project is expect to go into action in 2008/09. Mr S. Sarkar, Chief of Corporate Strategy and Marketing of Apollo Tyres, told Hindu Business Line that Apollo has already ramped up the production of the South African facility from 150 tonnes to 170 tonnes a day through “various de-bottlenecking exercises.” Productivity increases could lead to another 20 tonnes of output capacity being generated this financial year.

15th June 2007/by Tyrepress Editors

Rollier Gives Details of Michelin Cost Saving Plans

Speaking in an interview with French daily, Le Figaro, Michelin managing partner, Michel Rollier gave details of how less than 50 per cent of the 20,000 people who will retire from Michelin will be replaced. Michelin’s intention is close the labour cost/sales ratio gap between itself and its main competitors. While Michelin had a labour cost/sales ratio of 29 per cent last year, Pirelli’s and Continental’s labour cost/sales ratio were 21 per cent, according to Deutsche Bank figures.
“In our 2010 estimates we have assumed that only one third of the 1.5 billion gross cost savings (700 million from labour costs, 500 million from purchasing and 300 million from others areas like logistics) will be saved,” said the analysts. Instead 70 per cent is expected to be given back to dealers “mostly through higher gross margins.”

13th June 2007/by Tyrepress Editors

WTO: Brazil Retread Import Ban ‘Inconsistent’ With Trade Rule

After an extended period of consideration and consultation, the World Trade Organisation has ruled that Brazil’s ban on imports of retreaded tyres from Europe is not consistent with its international trade rules. As a result, the panel recommended that its ”Dispute Settlement Body request Brazil to bring these inconsistent measures…into conformity with its obligations under the GATT 1994.” However, the Brazilian government had continued to import retreads from neighbouring countries in the Mercosur trade group, leaving itself open for accusations of protectionism. The Brazilian government reportedly has no plans to appeal.

In a 241-page decision, the WTO investigative panel ruled that, while Brazil could restrict trade in certain goods on environmental and medical grounds, this does not apply to European retreads and cannot be used to aid trade discrimination or protectionism. The Associated Press quoted Stephen Adams, a trade official for the European Commission, as saying the European Union is “strongly in favour of environmental and public health protection, but Brazil's measures do not serve those objectives.”

13th June 2007/by Tyrepress Editors

Kubica Visits Bridgestone Poznan Tyre Plant

Employees at Bridgestone’s Poznan production plant in Poland enjoyed a day with BMW Sauber F1 driver Robert Kubica, who took time away from the track to pay them a visit. Poland’s star driver, who is currently nursing a leg injury after a horror crash at the Canadian Grand Prix in Montreal, toured the factory and saw how tyres are made before choosing Poland’s winner of the Bridgestone “dreams at heArt” children’s drawing competition.

He turned a few heads on the way, chatting to staff on the production line and signing autographs for a lucky few of his enormous fan club in Poland. The Kubica visit was part of official celebrations for the completion of the final expansion phase at the Poznan plant, raising daily production capacity to 22,000 tyres. The increased output will help meet growing demand across Europe for Bridgestone’s high-performance passenger car tyres.

12th June 2007/by Tyrepress Editors

Conti Breaks Ground at New Plant Site

On June 12 representatives from Continental conducted a groundbreaking ceremony in China’s Changshu City. At the new Changshu City site, a hundred kilometres northwest of Shanghai, the company’s Automotive Systems division will build a 67 million euro hydraulic brake systems plant. This facility should be ready to begin production in the autumn of 2008, and by 2011 should employ around one thousand local workers.

The new plant will be built in phases in the Changshu Southeast Economic Development Zone, located in Jiangsu Province. Production will focus upon the manufacture of hydraulic brake products and services such as calipers for front and rear axles and brake boosters for all classes of vehicle. Annual production capacity by 2011 should reach 2 million brake actuation units and 4.6 million brake calliper units, with the factory supplying numerous OEM customers in China, Japan and Korea.

12th June 2007/by Tyrepress Editors

Gajah Tunggal Issuing Bonds to Fund Expansion

Indonesia’s PT Gajah Tunggal has revealed plans to issue bonds to the value of US$95 million as part of company plans to invest in the development of two of its tyre manufacturing facilities. The company is looking at increasing its production capacity for motorcycle tyres in order to keep pace with demand both for its own products and those local market products it manufactures under licence for Michelin.

Catharina Widjaja, director of Gajah Tunggal, stated the company requires $170 million to develop the two facilities. The first of these upgraded factories will re-enter production in 2009 with a daily production capacity of 45,000 units, an increase of 15,000 units.

11th June 2007/by Tyrepress Editors

Tata Steel Looking at Increasing Tyre Wire Production

India’s largest steel producer, Tata Steel, is looking at making new acquisitions throughout Asia in order to expand capacity and establish a stronger foothold as a tyre industry supplier. According to the Indian business newspaper Mint, Tata Steel’s managing director B. Muthuraman has disclosed the company is looking to purchase both finished steel product companies and iron ore or coal mines in order to boost its annual 30 million tonne steel manufacturing capacity by more than 50 per cent within a decade.

“We are looking for acquisitions in the steel wires business in Indonesia and Southeast Asia. Apart from expansion in capacity, we also want to move into high grade, higher-value add wires used in tyre cords and oil tempered wires through acquisitions,” said Muthuraman. While the company is currently the world’s sixth largest steel wire manufacturer, producing half a million tonnes per annum, at present their principal tyre industry product is bead wire.

7th June 2007/by Tyrepress Editors

Amerityre Names Benninger as President and CEO

Amerityre Corp. has promoted chief operating officer Dr Gary Benninger to president and chief executive of the company. Benninger, 64, will become president immediately and will succeed Richard Steinke as CEO from 1 September. Steinke, 63, will serve as a full-time technology consultant once Benninger becomes CEO.

In January 2007, Mr. Steinke announced his intention to step down as chairman and chief executive officer of the company as part of the company’s overall management succession plan. The board of directors selected Dr. Benninger following months of deliberations and interviews with several potential candidates proposed by an independent executive search firm. Dr. Benninger has been serving as the company’s chief operating officer since October 2005.

7th June 2007/by Tyrepress Editors

Greater Focus Upon Tyres for Balkrishna?

An Indian newspaper has reported that Balkrishna Industries may be considering off-loading its paper business in order to focus upon the manufacture of tyres. On June 6 Mumbai based DNA (Daily News & Analysis) quoted unnamed ‘sources’ that a greater emphasis upon the tyre business, which accounts for more than 80 per cent of the company’s revenue and 95 per cent of profit, has led to the necessity to make such a decision.

However B K Bansal, head-finance, Balkrishna Industries, told the paper “There is no such plan for selling of paper business. We are expanding both our paper and textile business in the current fiscal.” The publication also spoke of plans by Balkrishna Tyres, which operates as a separate business unit to the paper and textile business, to increase production capacity for tractor radials through a £16 million capex.

6th June 2007/by Tyrepress Editors

Kazakhstan to Build Premium Tyre Factory

Kazakhstan has expressed its ambition to become a tyre industry player. The national government, the Astana Akimat, has signed a memorandum giving the go-ahead to build a new tyre manufacturing facility under the country’s “Kazakh Tyres’ Industry Sector Development” investment project. The memorandum was signed by numerous government officials.

According to Kazakhstan news agency Kazinform, the proposed factory will specialise in the production of premium car tyres, and will have an annual capacity of four million units. Approximately US$200 million is being invested in the project that will be located in the Astana Industrial Park, near where Nissan reportedly recently agreed to establish a manufacturing facility.

5th June 2007/by Tyrepress Editors

Tyre Production for Make Benefit of Kazakhstan

Kazakhstan, a country perhaps best known through the talents of UK film and television personality Sacha Baron Cohen, has expressed its ambition to become a tyre industry player. The national government, the Astana Akimat, has signed a memorandum giving the go-ahead to build a new tyre manufacturing facility under the country’s “Kazakh Tyres’ Industry Sector Development” investment project. The memorandum was signed by numerous government officials.

According to Kazakhstan news agency Kazinform, the proposed factory will specialise in the production of premium car tyres, and will have an annual capacity of four million units. Approximately US$200 million is being invested in the project that will be located in the Astana Industrial Park, near where Nissan reportedly recently agreed to establish a manufacturing facility.

5th June 2007/by Tyrepress Editors

Performance Fibers Announces China Expansion

In order to meet ever growing radial production in the Asia region, polyester fibre manufacturer Performance Fibers has taken the decision to expand the capacity of its tyre cord fabric facility in Kaiping, China by 30 per cent. The company will install new equipment and machinery, which should be operational at full capacity by the third quarter of 2007.

This most recent investment is the latest in a series of planned expansions at the Kaiping, including a greenfield expansion completed in 2006 to expand production of the company’s patented Dimensionally Stable Polyester high performance fibre and fabrics. These expansions have more than tripled capacity since early 2004, “This latest investment shows our ongoing commitment to meeting the strong demands of the Asian tyre market that continues to experience double-digit growth,” said Greg Rogowski, president and CEO of Performance Fibers. “As we have previously announced, additional expansions are planned into the future.”

5th June 2007/by Tyrepress Editors