Tyre and wheel business news from the segment’s most important companies.
At present Apollo Tyres exports 50,000 Apollo branded tyres a month to Europe from its factory in Vadodara, India, yet company ‘sources’ claim this quantity will increase markedly in the coming months. According to Indian financial journal the Hindu Business Line, sources expect a 30 per cent increase in the monthly shipment of tyres to Europe, with 65,000 units a month arriving here by March- April 2011.
A desire to accelerate corporate growth has prompted Michelin to launch a 1.2 billion euro capital increase aimed at existing shareholders. Through this capital increase the French tyre maker also aims to enhance its credit rating, access to financing and financial flexibility.
It’s a done deal – earlier this morning tyrepress.com reported Continental’s intention of placing a third euro-denominated bond. The German company has now reported the successful placement of this third bond, as issue with an aggregate principal amount of 1.25 billion euros. The issue consists of two tranches of 625 million euros each, which respectively mature in 2016 and 2018. As per the company’s previous statement, the bonds will be issued by Conti-Gummi Finance B.V. and guaranteed by Continental AG and certain of its subsidiaries. The coupon is 6.5 per cent per year for the tranche maturing in 2016 and 7.125 per cent per year for the tranche maturing in 2018. Interest will be payable semi-annually in arrears.
Projections made by Yokohama Rubber on July 30 for its consolidated net sales and earnings in the first half of the current financial year have been raised to reflect accelerated progress in cost cutting and an increased sales forecast. For the six-months between April 1 and September 30, 2010, the company now anticipates that the 3.9 billion yen (£29.2 million) net loss experienced in the first half of the previous financial year will “shrink to approximately zero.” Company management expects operating income to be 6.3 billion yen (£47.2 million), as opposed to an operating loss of 4 billion yen a year earlier.
After a positive response to its two previously placed bonds, Continental AG has announced plans to issue further Eurobonds with benchmark volume. The company has again mandated a bank consortium led by Citi and The Royal Bank of Scotland to place two tranches of euro-denominated bonds with qualified German and international investors. A maximum issue volume of 1.25 billion euros and two tranches with maturities in 2016 and 2018 are planned. Upon announcing the upcoming bonds on September 27, Continental said the issue volume and the conditions are expected to be finalized in the “next few days”.
Bridgestone Europe has released the latest edition of its environmental report. The document, titled ‘Environmental Commitment and Performance’, updates the 2009 version and adds content on the upcoming European tyre labelling legislation, Bridgestone’s new eco-oriented Ecopia tyre range and the company’s environment-related activities in the community.
Continental AG says automobile production in Europe and the US will remain stagnant next year, which is why it is stepping up expansion in Asia. The tyre and auto part maker said growth in emerging markets like China, India and Indonesia is important to its continued success.
A desire to provide customers with a more efficient and professional service is the given reason behind Bridgestone Europe’s decision to restructure its organisation. A series of changes have been planned and Bridgestone is already working at introducing these; the company aims to have the restructured organisation fully operational by January 1, 2011. Significant changes to be implemented include the division of responsibility for sales functions into six geographical regions, each with its own regional headquarters that will operate under the overall control of Bridgestone’s European headquarters in Brussels. A reorganisation will also be undertaken at the Brussels headquarters; Bridgestone says this should result in better operational support being given to the regional sales companies in specialised areas.
Michelin has become the 50th ‘business champion’ to join government-backed Driving for Better Business campaign. In doing so, the company has committed to help promote at-work driving safety initiatives to other public and private sector fleets. The tyre maker’s involvement with the campaign comes after reducing its road crash rate by more than 50 per cent in the last five years and adopting a target of zero incidents. Michelin says improving safety has helped reduce accident damage costs by 46%. It has also seen significant savings on indirect costs, such as vehicle hire and driver time.
In the past year Watts Tyre Group has attained the new ISO 9001:2008 standard and renewed its Approved Supplier status from Toyota Industrial Equipment SA, and now the UK based industrial tyre and wheel producer reports it has again passed the ongoing assessment for ISO 14001:2004 and its Environmental Management system. In announcing this latest achievement, company CEO Jean-Paul Mindermann commented “our quality accreditations are very important to us as a business and we are delighted that we continue to keep our standards high. As a key supplier to the world’s leading materials handling manufacturers it is vital for us to ensure that the quality of our products and processes is world class.
Bridgestone Corporation has announced a number of senior personnel changes, scheduled to take effect October 1. Yoshiyuki Morimoto has been appointed vice president and officer of Tire Research and Material Development plus assistant to the vice president and officer, Office of Group CEO Technology Relations. Akihiro Eto will become vice president and officer, chief financial officer of Finance and chief information officer of IT & Network; Eto will concurrently serve as director Corporate Planning Division, Internal Control Division, Advanced Business Development Division; he will also take on the role of general manager Paper Business Planning and Sales Department. Yutaka Yamaguchi is to become vice president and officer Tire Products Development. At the end of October Akihiro Eto will shed some of his responsibility, and will serve as vice president and officer, chief financial officer of Finance and chief information officer of IT & Network plus director Corporate Planning Division and Internal Control Division.
Following the signing of a definitive agreement, Eurotire Inc. has become a global distributor for the PressurePro range of TPMS products produced by Advantage PressurePro. According to Advantage PressurePro, distribution of its TPMS product line is a “natural extension of Eurotire’s focus on providing their mining customers with the OTR tyre service and support tools they need to maximise tyre productivity.” The US headquartered company lists facilities in every continent amongst its worldwide operations.
On September 1 the management and staff of Kumho Tire Inc., along with important customers and partners, celebrated the company’s fiftieth anniversary at its headquarters in Seoul and its parent facility in Gwangju. “We look back with pride over the past fifty years and the successful development of Kumho Tires and based upon this look positively towards the future and the and the successful accomplishment of the next fifty years,” Kumho Tires CEO stated Kim Jong-Ho during the celebrations at the Gwangju facility. He thanked all employees for their loyalty to Kumho Tires during both good and bad times.
Continental AG reports it has further improved its debt maturity profile through the placement of a euro-denominated bond with an aggregate principal amount of one billion euros. The seven year notes are to be issued by Conti-Gummi Finance B.V. and guaranteed by Continental Aktiengesellschaft and certain subsidiaries. The coupon will be 7.5 per cent per annum interest, payable semi-annually in arrears.
Bridgestone has announced that it will raise the prices by between 3 and 6 per cent of its consumer, commercial and speciality tyres in Europe during October 2010. Bridgestone Europe CEO and president Makio Ohashi said that “historically high” raw materials prices had necessitated the hike, while “further increases will be necessary in the coming year”.
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