Cooper Tire & Rubber is interested in expanding its presence in Latin America. Last November the tyre maker signed a Memorandum of Understanding with Argentina’s Fate SAICI, an agreement that initially covers distribution but may be extended to R&D and offtake production, and this month Cooper announced it has established a sales office in São Paulo, Brazil.
The signing of a letter of intent between Cooper Tire & Rubber and Argentine tyre maker Fate opens the door to a number of cooperative possibilities, including joint research and development and the offtake production of Cooper tyres in Argentina. Initially, however, the two companies’ work together involves Fate serving as a distributor of Cooper-branded passenger car, light commercial vehicle and SUV tyres in Argentina alongside its own tyre portfolio.
Brazilian company Vipal, best known for its tyre retreading and repair materials, and Argentine tyremaker Fate have signed a memorandum of understanding with the Rio Grande do Sul State of Southern Brazil to set up a new tyre factory. The first bi-national industrial collaboration in the state, the Vipal/Fate project sees the companies invest around US$200 million in building a “farm equipment” and “aftermarket car parts” tyre plant. There has been no official confirmation of what brand the new tyres will be produced under, but Tyres & Accessories understands that this means production will focus on passenger car and van tyres.
At the end of July Continental’s existing tyre production arrangement in Argentina comes to an end, and the company has plans to replace this current licensing deal with a direct subsidiary. Tyres sold in this market will henceforth be sourced from elsewhere.
Fate SAICI is something of an anomaly in South America. While the tyre markets in every other country in South America are led by the regional wings of multinational corporations, Fate is Argentina’s largest tyre producer ahead of Bridgestone Firestone Argentina and Pirelli Neumaticos. Tyres & Accessories asked Fate’s Walter Hack what it is that sets the company apart and learnt of some developments within the company’s product portfolio.
Carlos Redondo has been Pirelli’s CEO for Latin America since the beginning of 2003. Before that he was CFO for Pirelli Tyres worldwide. With a turnover of approximately 1 billion euros, about one third of Pirelli’s total worldwide turnover Mr Redondo is successfully piloting his division from its headquarters in Sao Paulo. Tyres & Accessories met Mr Redondo last month in Usuhaia, south Argentina, in conjunction with the launch of its new Sottozero winter tyre. To download the whole article as a PDF file, click here.
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