Yokohama Rubber has been manufactured and sold aircraft tyres, both new and retreaded, to the Japanese military and to Japanese domestic airlines since 1940, however the company has now decided to withdraw from this business. According to Yokohama, this decision was taken as aircraft tyre sales constitute only a minor part of Yokohama Rubber’s entire business, and do not offer strong future growth potential.
Prominent European online tyre dealer Delticom AG reports closing its 2008 fiscal year with a record result. Despite a disappointing year for the tyre industry and for tyre retailers, Delticom’s online business model has again exhibited strong growth. The company recorded significantly increased sales in nearly all of its more than 100 online shops in 35 countries. This is reflected in year-on-year rise in revenues in each quarter. In the fourth quarter alone, revenues of 84.0 million euros were achieved, up from 69.5 million euros in the corresponding quarter of 2007. For the whole year, Delticom increased revenues year-on-year by 20.2 per cent to 259.0 million euros. With these results, Delticom hit the upper end of the revenue targets the company released at the beginning of the last year.
During 2008, Continental’s market share of the European original equipment market is said to have increased from 30 per cent to over 32 per cent. In contrast to this growth, the company reports it “sacrificed” some of its “unprofitable business” in the NAFTA states and South America, reducing its market share to 14 per cent – as planned. In total, Continental sold almost 40 million original equipment passenger and light truck tyres last year. The German company is anticipating fewer sales to vehicle manufacturers in 2009 and expects the market will pick up again in the fourth quarter. At the same time, Conti reports it will continue to focus on profitable deals in NAFTA countries. Supplies to Asian car manufacturers, which last year accounted for 0.7 million tyres, are forecast to remain fundamentally unchanged.
Belgium based Punch International nv, parent company of wheel manufacturer BBS International GmbH, has posted an net profit of 43.3 million euros for the 2008 year, an increase of 51.9 per cent – however the company has made the less than sanguine statement that the performance of its automotive operations were “weak” and the market “extremely difficult. Altogether, the company generated sales of 341.5 million euros, an increase of 3.0 per cent on 2007.
The ripple effect from the downturn in North America’s construction industry is being felt by Bridgestone Americas Tire Operations (BATO). In response to a decline in demand for construction equipment, BATO is decreasing production of its small and medium off road tyres, and as of March 1 will lay off 67 hourly workers at its Bloomington, Illinois facility.
According to Bridgestone, production must be reduced in order to better align this inventory with demand. “The dramatic downturn in the economy continues to plague every industry, including ours,” said Shawn Rasey, president, Off the Road Tire, U.S. & Canada, Commercial Tire Sales division, BATO.
Yokohama Rubber has released its results for the first three quarters of the current financial year, and the company has joined the growing list of firms whose income has been severely curtailed in recent months. Operating income to December 31, 2008 declined 43.8 per cent from the same period of the previous year, to 17.3 billion yen (£134.19 million), on a 0.2 per cent increase in net sales, to 410.6 billion yen (£3.18 billion). Net income declined a whopping 99.1 per cent, to 222 million yen (£1.72 million).
Sales growth in Yokohama’s Tire Group offset a decline in the Multiple (diversified) Business Group, the company reports. Operating profitability suffered from the rise in raw material costs during most of the nine-month period, from the appreciation of the yen, and from the sharp decline in demand for tyres and hoses, which undermined productivity in those product sectors. Net income reflected the downturn in operating profitability, the effect of the strengthening yen on foreign currency–denominated sales receivables and on debt liabilities at overseas subsidiaries, and the partial relinquishment of a tax benefit associated with the write-down of unrealised gains on inventories.
Pirelli Tyre has reported that its sales revenues fell marginally down 1.5 per cent from 4.162 billion euros in 2007 to 4.1 billion in 2008. However, pre-tax profits fell considerable due to the difficult economic environment and raw material costs. EBITDA stood at 443 million euros, down 19 per cent compared with 548.6 million euros in 2007. And EBIT came in at 250 million euros, 30 per cent down on 2007’s 358 million. As a result, the company reports that it “undertook restructuring actions, accelerated in the fourth quarter against further deterioration of the market, in order to strengthen the competitiveness of the industrial organization in Europe and reduce costs of central structures.”
The company registered revenues of 870 million euros, down 5 per cent on a like-for-like basis, in the fourth quarter of 2008. EBIT of 18 million euros before restructuring charges (which in the fourth quarter alone amounted to 68 million euros) compared with 71.9 million euros the year before.
Following the release of Toyo’s latest financial results, the company has announced a host of measures to stem its financial haemorrhaging. The company reports being in the midst of business conditions that it expects will grow ‘more stringent’ and be reflected in further deteriorating earnings for the 2008 financial year. The sources of these woes, the company adds, are the global economic slowdown and the yen’s appreciation.
Toyo reports a review of its Japanese and international manufacturing systems is underway, and on the back of this it will reduce the number of employees at manufacturing operations to match current production levels. As part of its reorganisation, Toyo says it plans to transfer employees from administrative departments to manufacturing departments.
It has been just over a year since Starco GB added the industrial tyre segment to its existing product range, and although market conditions have been tough, the company reports that it has achieved “substantial growth” in this area. As the UK and Ireland distributor for the Globe Star product, Starco stocks a wide range of resilient solids and press on band tyres, both standard and non-marking easyfit. The solids are complemented with a full range of Kenda Kinetics pneumatic forklift tyres and an even wider range of other industrial, agricultural and skid steer sizes due to the recent addition of the Deestone range of product.
Tire Service Equipment and Saf-Tee Siping & Grooving, or TSISSG as it is known to its friends, is perhaps best known for its machinery dealing with the maintenance of tyres. However, Scottish retail business Overton Garage is heartily behind the company’s series of wheel crushing and tyre cutting equipment, having sold hundreds of examples over the years. The company reports great results for those who have made the investment; if it is time for a beloved set of rims and rubber to go to the great recycler in the sky, you may as well do them the service of making the job a quick and efficient one.
For over 25 years TSISSG has been a leading manufacturer and innovator of products and equipment for the tyre service and tyre recycling industries. Its products are designed and developed by experts in the respective industries with a passion for testing and quality, manufacturing almost all of its products in the USA.
Future models of the Toyota Yaris 1.0 litre will be shipped with only one type of tyre – Michelin’s Energy Saver. The French manufacturer says that the decision follows close research and development cooperation between it and Toyota in order to obtain the balanced performance the vehicle manufacturer was seeking. Michelin adds that innovative solutions were introduced for the rubber compound, a material that integrates new forms of silica, as well as for tyre design and production processes.
Over the past several years, tyre distributor Star Group Shanghai Co. Ltd. (Star-Tyre) has experienced rapid growth. The company’s inventory encompasses over twenty-three different popular brands of Chinese tyres, and the company reports it has strategically aligned itself with a number of China’s leading tyre manufacturers – a move Star-Tyre believes has brought about one of its greatest advantages.
The Shanghai headquartered firm operates distribution warehouses in China’s Qingdao, Shanghai, Dalian and Tianjin regions, and keeps considerable stock in its premises, which are located near major international seaports. This gives, says Star-Tyre, the company the opportunity to provide faster and more effective delivery to its clientele in any world destination. The distributor adds that its ability to purchase products in volume affords it a price advantage over competitors – an advantage Star-Tyre says it passes onto its customers in the form of a better purchase price.
Bridgestone Americas Tire Operations (BATO) has made was it calls “a difficult decision”. On January 22 the Bridgestone Americas unit announced that, in light of negative economic conditions, it will cease the manufacture of passenger car and light truck tyres at its factory in LaVergne, Tennessee. This sombre news follows a December 1, 2008 notification that 148 hourly and 10 salaried positions were being eliminated at the facility.
“Based on current economic forecasts, it appears that the global economic crisis is going to get worse before it gets better. We are not immune from these challenging times,” said Steve Brooks, president, US, Canada and Monterrey Manufacturing Group, BATO.
Despite increased sales in 2008, JK Tyre’s fourth quarter results reveal a net loss for the quarter and reduced profits through the entire financial year. The company reports net sales of Rs 40,524.8 million (£591.4 million) during the 12 months to December 31, 2008, up 43.9 per cent on the 2007 yearly result. During the fourth quarter net sales were Rs 7,798.2 million (£113.8 million), a more muted 6.9 per cent increase on the fourth quarter of the previous year.
Pirelli Tire Inc has opened a second warehouse distribution centre. The new facility is located in Vancouver, British Columbia, and the company reports that it is “dedicated to servicing customers in western Canada.” Pirelli has appointed Schenker Distribution to manage the operations effective immediately. Despite widely publicised tribulations in the automotive sector, Pirelli’s continuing growth in Canada makes capacity expansion necessary at this time, Marco Zambianchi, vice-president & general manager of Pirelli Canada, explained: “As our brand continues to grow, this addition will ensure that our dealers can fully satisfy consumer demand in a timely fashion.” Pival International Inc. remains the company’s primary distribution centre in eastern Canada.
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