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Cooper Reports Net Sales Increase and Income Drop

Cooper Tire & Rubber has reported a 5 per cent year-over-year increase in net sales, a fourth quarter record for the company’s tyre operations. At the same time the board of directors authorised the repurchase of up to $200 million of the company’s publicly traded notes. This will be done through open market transactions, a tender offer or a combination of the two. Total net sales for the company’s continuing operations increased to $541 million in the quarter ended 31 December 2004, compared to $515 million in the same period of 2003. Income from continuing operations dipped significantly in the quarter to $3 million (4 cents per share) from $8 million (10 cents per share) in the fourth quarter of 2003.

16th February 2005/by Tyrepress Editors

Michelin Extends X One Guarantee

Michelin is extending the X One Total Satisfaction Guarantee into 2005, US magazine e-trucker has reported. The guarantee will be available to X One tyre customers in the US that purchase at least four replacement assemblies. According to the report, the guarantee will cover the first 10 sets of X One tyres purchased. As part of its guarantee, Michelin will buy back X One casings and will cover 75 per cent of the cost of the wheels if the owner isn’t pleased with the tyre’s performance at the end of its original tread life. Michelin recently added a new production line at its Spartanburg, South Carolina, factory partly to increase its capacity to produce X One tyres.

16th February 2005/by Tyrepress Editors

Michelin Sells Wheel Business to Mefro

Michelin is set to sell its wheel business to the German Mefro group. According to Michelin, the new owners will keep both manufacturing plants and their 1800 strong workforce intact. Mefro, a family-owned company, has an annual turnover of approximately 160 million euros and aspirations to become the “number one European wheel manufacturer.” Now in light of the recent purchase, the company sees itself as a significant competitor to European steel wheel producers Gianetti and Hayes Lemmerz.

16th February 2005/by Tyrepress Editors

Brazillian Tread Producer Aims For International Market

Brazillian retread product manufacturer, Vipal, holds 43 per cent of the world’s second largest market and is represented in 90 countries. Now the company is aiming to expand its global business. After a successful SEMA show, the company stepped into the Mexican market with the inauguration of the Vipal distribution centre in Mexico and the launch of the Vipal Authorized Dealer Network. The company also launched its new Vipamold VRA tread design for use on drive and trailer tyres.

15th February 2005/by Tyrepress Editors

Degussa To Expand Carbon Black Capacity In 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.

14th February 2005/by Tyrepress Editors

Mahle Increases Share of Piston Manufacturer

Mahle International has increased its share in Izumi Piston Manufacturing Co, (Thailand) Ltd from 34 to 52 per cent. The company will now operate under Mahle Engine Components Thailand Ltd supplying the Thai automotive industry with 1.8 million pistons per year, predominantly for passenger car and commercial diesel engines. The 370 employees at the Bangkok location currently achieve sales of around 13.1 million euros. With 7 locations, Mahle now has a production capacity of 18 million pistons and is one of the largest suppliers in this sector on the most dynamic growth market. The announcement is retrospectively effective from 1 January.

10th February 2005/by Tyrepress Editors

Birla Tyres Expects Increased Turnover

Birla Tyres is expecting its turnover to reach 6.5 billion rupees (£80 million), New Delhi’s Business Standard has reported. Speaking to a press conference at the launch of a new truck tyre (the BT 339+), Amit Choudhury, vice president (technical services) Birla Tyres, said: “With several products already launched and a few more in the pipeline, Birla Tyres is on a fast growth track. We garnered a market share of 11 per cent in truck tyres across the country, and 30 per cent of our products are exported to about 30 countries including Pakistan, Afghanistan, Vietnam and Belgium. We expect our turnover to touch 6.5 billion rupees in the current fiscal.” Referring to the newly-launched product, he said: “The new product is an extension our main brand BT 339, with higher physical dimensional features. It is specially designed for multi-axle vehicles.”

At present the company’s truck tyre factory in Balasore, Orissa, produces 87,500 truck tyres each month. “The production capacity will go up to 93,000 tyres per month by June 2005,” Mr Amit explained. The Balasore plant was formed as a technical collaboration with Pirelli Ltd. The company owns 2,000 retail outlets, 52 stock points and 80 carrying-forward agents across the country, he added.

7th February 2005/by Tyrepress Editors

Kumho Tire Raises $363 Million in IPO

Kumho Tire, South Korea’s second-largest tyre maker, raised 373 billion won (around £193 million) in its recent IPO, according to the Reuters news agency. The total equates to the country’s largest issue in more than six months, the report added.

Kumho, which controls 42 per cent of the home tyre market, is selling 25.49 million shares at 14,650 won each, near the midpoint of an expected range between 13,250 won to 16,000 won, a source familiar with the deal said. The world’s 11th-largest tyre maker, will use the proceeds to expand its operations in China and slash debt. The dual listing in London and Seoul attracted good demand while Cooper Tire & Rubber Co. of the United States pledged to buy nearly 30 per cent of the shares offered, the report concluded.

4th February 2005/by Tyrepress Editors

Fifty Years of Federal

For most, January marks the beginning of a new year, but for Federal 2005 represents the end of its golden jubilee. During 2004 the company celebrated 50 years of a business that has grown significantly since its earliest days and announced that it would expand its total production capacity to 8 million units in 2005.

In recent times, a number of companies have investigated the possibility of manufacturing in China. Federal too has sought to take advantage of this emerging market. Federal’s explanation for moving to the people’s republic is because of Taiwan’s “high labour costs.” Now, although work at the Federal Taiwan plant continues, the company also produces in China. According to the company, “the potential of the China plant is massive with capacity growing from 1.5 million units at the end 2003 to 2.5 million in 2004. “This figure will soar to 3.5 million by 2005 and the trend will continue until Federal’s total capacity, including its Taiwan plant, reaches 8 million units. The major expansion will take place in the China plant, which provides huge opportunities for any potential OE business in China,” says Jamie Ma.
With the growth in automobile manufacture in China and with most manufacturers intent on securing a manufacturing base, the potential of emergent companies such as Shanghai Automotive Industry Corp and China Brilliance have attracted Federal.

Commenting on the Chinese market Mr Ma said: “High-tech tyres such as the Hero Milanza UHP will definitely be a tyre that should generate great market demand. We intend to market the tyre, not simply by emphasising its price competitiveness, but rather by its trendy look and remarkable performance.”

One advantage Federal believes it has over other manufacturers is its delivery times. “Unlike many large-scale manufacturers that have delivery lead times of 90 days from order, Federal’s delivery time is typically one month. Although the unprecedented huge order volumes received earlier this year affected the delivery time, urgent measures have been adopted to cope with this increased demand and our customers will confirm that the delivery service is returning to previous levels,” explained DaWu Chen, senior manager at Federal’s global business department.

Now, half a century down the line from its beginnings, Federal wants to expand its influence around the world. “We intend to bring this same reputation for ultra high performance tyres to Europe and particularly for markets that have a significant demand for UHP tyres. The extended territory and market size of the EU provides a considerable growth potential and Federal plan to explore every new opportunity in this area,” said company president, Jamie Ma.

Federal won’t be drawn on where its marketing focus is, instead its states that its concentrates “on a general basis worldwide.” DaWu Chen suggests that other expansion into other European markets may follow a similar pattern to the how things have worked in the UK. “The kind of partnership seen in the UK, where an independent wholesaler has taken a proactive lead with aggressive marketing and promotion of the brand and the targeting of key customer groups, is fundamental to future market expansion in other European markets.”

4th February 2005/by Tyrepress Editors

Lion Forest to Buy Silverstone

Pulp and paper producer Lion Forest Industries Bhd (LionFIB) has proposed to acquire Silverstone Bhd, which manufactures tyres, The Star, Malaysia, has reported. Both Lion Forest and Silverstone Bhd are members of the Lion group.

In a statement given to Bursa Malaysia yesterday, Lion Forest said that wholly-owned subsidiary, Quay Class Ltd, had entered into an agreement with Silverstone Corp Bhd to acquire the entire equity in Silverstone Bhd for a total of 225 million ringgits (£31.31 million), to be paid for through a combination of cash and new Lion Forest shares. Silverstone Bhd is currently wholly owned by its holding company, Silverstone Corp, which is listed on Bursa Malaysia.

3rd February 2005/by Tyrepress Editors

Amtel Revenues up 18 per cent

Amtel Holdings Holland (AHH) has announced that company revenues grew to $451 million in 2004, up 18 per cent. “Amtel produced more than 14 million tyres in 2004, making it a record-breaking year,” Mr Gurin noted. The unaudited results were made public by AHH managing director, Alexei Gurin, during a press briefing at Russia’s biggest annual tyre exhibition – Tires & Rubber 2005.

2nd February 2005/by Tyrepress Editors

Bandag Profits Increase 10 per cent

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.

1st February 2005/by Tyrepress Editors

Bridgestone to Construct Third Plant in Mexico

Bridgestone has announced that it build its third factory in Mexico at a cost of $220 million (£117 million). According to Bridgestone, the factory will be the company’s first automated plant overseas from “initial processing of materials to final inspection of the finished tyres.” The plant will feature Bridgestone’s first installation of its BIRD (Bridgestone Innovative and Rational Development) system.

28th January 2005/by Tyrepress Editors

Indian Tyre Market Grows 8.3 per cent

The Indian tyre industry has grown at a rate of 8.3 per cent over the last decade, mainly fuelled by strong growth in the domestic car industry, according to research and markets. A new report from the analysts concludes that although the replacement market has driven the industry, the OE market has also seen robust growth over the last couple of years.

Confirming these findings, Apollo Tyres recently posted third quarter results showing a 7.74 per cent rise in net profits to £2,060,000 for the quarter ended 31 December. In response, Apollo shares were trading at 253.90 rupees, up 1.56 per cent.

The industry is highly capital intensive, requiring around 4 billion rupees to set up a radial plant with a capacity of 1.5 million tyres, and around 1.5 – 2 million to construct a crossply plant of the same capacity, research and markets reports. The Indian industry is dominated by a few main players. MRF, Apollo Tyres, JK Industries and Ceat all enjoy more than 70 per cent of the total market share.

28th January 2005/by Tyrepress Editors

Tokai and Mitsubishi Revoke Alliance Agreement

Tokai Carbon and Mitsubishi Chemical Corp have agreed to revoke their agreement to form an Alliance of carbon black businesses. The companies will also withdraw their application for examination by the Fair Trade Commission. The commission had suggested that “the alliance might substantially restrict competition in the Japanese domestic market that is presently short-supplied.”

“We anticipate harsher competition in the carbon black industry in Asia including Japan where aggressive capacity expansions are being made in expectation of rapid growth in the automobile industry, the main consumer of carbon black … We will expand and reinforce our business bases mainly in rapidly growing Thailand and China, as well as accelerate development into high added-value products and new market areas under the basic policy of ‘Powerful R&D,’” the company said in a statement. The stated that it would remain open to the possibility of future alliances.

26th January 2005/by Tyrepress Editors