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More Details on Michelin’s Efficiency Improvement Plans

Following a roadshow in the US hosted by financial analysts at Deutsche Bank, further details of the previously reported Michelin corporate restructuring programme have been released. The company is said to be aiming for a 30 per cent productivity increase by 2010 (10 per cent from production increase/ 20 per cent from workforce consolidation).

In addition Michelin is said to be looking to produce a better equilibrium of production/sales by continent. This is likely to have a significant effect on the European business as Europe represents 70 per cent of the group’s production compared with only 50 per cent of sales. Plant size is also likely to be rationalised, with the ideal size being described as 8 to 10 m passenger tyres and 2 million truck tyres per annum – basically double the current size of some plants.

Deutsche Bank reports that Michelin’s management still believes in a potential shortage of truck tyres in 2008.

28th September 2007/by Tyrepress Editors

Rent’N Go Launches Rent-to-Own Wheels and Tyres Franchise

After years of perfecting the Rent’N Go wheels and tyres hire purchase retail concept, RNG President Bob Catino announced the official launching of the company’s franchising programme in the US. “While I always felt our expansion would be through franchising, it has happened a bit faster than I thought it would. The system is ready and the results from operations indicate the time is right to launch our franchising initiative,” says Catino.

Rent’N Go started coming together for Catino after he met Jim Taylor, a veteran of the wheel and tyres business. They became fast friends working on developing the first Rent’N Go store in Tamarac, Florida. Taylor is the company’s vice president of operations.

20th September 2007/by Tyrepress Editors

Profits Up At McConechy’s

McConechy’s Tyre Services, Scotland’s biggest independent in truck tyre supply and repairs, has recorded a 53 per cent rise in profits. The results come just under a year after the company announced that its surplus had fallen by around 50 per cent. In its latest set of financial accounts, McConechy’s reports pre-tax profits of £975,942, compared with £636,368 the year before. However, this figure was a much as £1.2 million in 2005, a height that the company said was hit by one-off restructuring costs including the closure of its Paisley retreading plant. The 2006 accounts show that turnover is up 7 per cent to £33.8 million.

The report added that directors plan to invest £1.4m this year as part of its ongoing programme of refurbishments, relocations and acquisitions.

12th September 2007/by Tyrepress Editors

US Trade Group to Visit Bridgestone HQ

The US state of Ohio is keen to let Bridgestone know that they are welcome in its part of the world. Lieutenant Governor of Ohio Lee Fisher is heading a delegation of almost 50 business and financial development leaders to Japan in order to foster relationships that will create new jobs and investment in the state.

The delegation’s itinerary includes a visit to the headquarters of the world’s largest tyre major. Bridgestone already has a strong presence in the city of Akron and adds much to the local economy. ”Anyone who is here already, we want to thank them for being here and assure them of the state’s commitment to them,” said Carin Rockind from Team NEO, one of the organisations participating in the visit. Rocksin added that if Bridgestone, or indeed any other company, is looking to expand their US presence, ”we want those new investments to come our way.”

10th September 2007/by Tyrepress Editors

Exports from India Growing Steadily

The value of tyre exports from India has grown at an average of 11 per cent per annum during the last decade, according to India’s Automotive Tyre Manufacturers’ Association. The current value of exports of all category of tyre is Rs 26 billion (£315.5 million). During the 1996/97 financial year total exports only amounted to Rs 8.32 billion (£101 million).

Since the start of this current decade the strongest export growth has been in the passenger car sector, with exports increasing more than tenfold to 966,046 units in 2006/07. While this amount is still dwarfed by exports of truck tyres (2,276,049 units) and tyres for light commercial vehicles (1,599,230), the high level of passenger car tyre radialisation achieved by tyremakers has provided them with a product that can potentially gain acceptance in many more overseas markets.

6th September 2007/by Tyrepress Editors

Amtel-Vredestein Postpones Eurobond Issue

Amtel-Vredestein N.V., has postponed plans to issue a previously announced 150 million euro Eurobond due to “adverse market conditions.” Instead, it plans to investigate a range of other funding options with Nomura International plc and other financial institutions.

“While a Eurobond may be an effective financial instrument, current market conditions are not optimal and an issue at this time could potentially restrict our pursuit of a more comprehensive financing programme,” said new CEO Peter Zolotarev. “Over the past several years, Amtel-Vredestein has expanded its production and distribution platform, and nearly completed its modernisation programme. We are currently re-visiting the Company’s development strategy and our first priority must be to strengthen the balance sheet to ensure long-term sustainability, profitability and stakeholder value.”

4th September 2007/by Tyrepress Editors

Several Companies Show Interest in Ailing ATS Plant

A number of companies have cast a hungry eye upon the factory owned by ATS Light Alloy Wheels South Africa a month after the company was placed in provisional liquidation. One of the joint liquidators, Alan Pellow, said that about six companies had already inspected the plant and “some people in the US want to have a look.”

The liquidators say they are striving to find a buyer who we take on the factory as a going concern, however this happy outcome is by no means certain. “We are waiting for the final valuations for the plant and will then probably send out an information pack worldwide and see what we can bring in,” Pellow added.

ATS Light Alloy Wheels South Africa is a wholly owned subsidiary of Tiger Wheels’ 74 per cent owned German unit ATS Beteiligungs. In addition to the South African facility, ATS also operates alloy wheel manufacturing plants in Germany, Poland and the US. Directors and senior management at the South African plant applied for liquidation of the company due to ongoing cash flow problems, and the decision as to if or when liquidation is finalised is dependent on a high court decision.

28th August 2007/by Tyrepress Editors

Bekaert Australian Steel Cord Plant to Close

Belgium’s Bekaert Group and its Australian joint venture partner OneSteel Pty Ltd have decided to close their steel cord plant located in Geelong, Australia. This decision follows an extensive review of business performance, including customer and market outlooks, financial performance, plant operations and sourcing alternatives.

Employees, customers and suppliers have been advised of the closure, which will occur by the end of the year after all customer supply contracts and commitments for 2007 have been completed. The company says it will work closely with the plant’s 74 employees and their union representatives to provide advice and job placement assistance.

The joint venture, known as Bekaert Australia Steel Cord Pty Ltd, was established in 1986 to supply steel cords and hose wires to tyre and hydraulic hose manufacturers in Australia, New Zealand and South East Asia. Bekaert says these markets will for the immediate future be supplied with products sourced from factories in North and South East Asia.

24th August 2007/by Tyrepress Editors

Hayes Lemmerz Names Yost Executive Vice President

Hayes Lemmerz International has promoted vice president, finance and chief financial officer to the position of executive vice president and chief financial officer. Along with gaining the world “executive” to his title Mr. Yost is responsible for the company’s global finance and information technology functions, and will continue to report to Curtis J. Clawson, president, chief executive officer and chairman of the board.

The global wheel and automotive component manufacturer states that Mr. Yost has strengthened the company’s finance team and enhanced internal accounting controls across the Company. Furthermore, Hayes Lemmerz gives Mr. Yost much credit for the success of the recent equity rights offering and debt refinancing, which raised new equity, retired high cost debt, and strengthened the company’s balance sheet.

24th August 2007/by Tyrepress Editors

Michelin Voted Most Recognisable Tyre Brand in the UK

Michelin’s long established heritage and iconic mascot has helped it become one of the most recognisable and best-loved brands on the UK market, a phenomenon highlighted by recent survey results released by the Superbrands Council. The French tyremaker was listed as the 38th most recognisable brand in the UK out of a finalists list of 500 companies. This high ranking placed Michelin above market leading companies such as Apple (41st place), McDonalds (45) and IBM (61). The next tyre manufacturer to appear on the list was Italy’s Pirelli, in 69th place.

Judging for the Superbrands scoreboard is carried out by a cross-section of experts and consumers, with a ‘short-list’ of almost 1,500 brand names coming in for scrutiny. A total of more than 3,000 people are surveyed by independent research agency YouGov in order to formulate the results, which reflect public opinion on factors such as quality, reliability and distinction.

23rd August 2007/by Tyrepress Editors

‘Awesome Foursome’ Celebrate Training Success

Technicians at a First Stop dealership in Cornwall have earned a new nickname – the ‘awesome foursome’ – after their noteworthy performance on a tough training course. The quartet, from the St Austell and Bodmin branches of Steve Andrews Tyres, have each attained the Institute of Motor Industry (IMI) Level 4 Certificate in Management in partnership with Bridgestone UK. More than 30 people took the course, but the four men, plus just one other person, were the only ones to pass.

Thus, as well as being dab hands at carrying out a comprehensive range of repairs, the technicians have shown themselves to be equally adept at running the show behind the scenes as qualified managers. “The fact only five people passed the IMI certificate tells you what a demanding course it was, so to have all four of our guys amongst the successful candidates is quite an achievement,” said boss Steve Andrews. “The guys have proved themselves excellent ambassadors for the business, and the additional skills they have gained in completing the course will strengthen the team as we take things forward.”

17th August 2007/by Tyrepress Editors

Dunlop India to Retain Factory Land – For Now

Dunlop India’s battle to retain a legitimate claim to a piece of land at its factory in Ambattur, Chennai has been given a boost by a decision made by a district court in Chennai. The court has ordered that, for the time being, the land seized by real estate company VGN Enterprises should remain in the hands of the tyremaker.

The court official, Ponneri executive magistrate and revenue district officer, M.S. Sangeeta, said in an interim order that “the impugned land should be placed in as-is-where-is condition without any change, construction, removal of machinery or apparatus and [the] status quo should be maintained.”

This interim order lends weight to the Ruia group’s argument that the sale of 60.86 acres of factory land to VGN Enterprises in 2004, a transaction made by Dunlop India’s previous owners, was illegal.

15th August 2007/by Tyrepress Editors

Sumitomo Rubber Reports Half-Year Figures

Sumitomo Rubber Industries has announced its consolidated interim financial results for the period between January 1 and June 30, 2007. Net sales for the company were reported as 253,858 million yen (£1.060 billion), slightly lower than the 2006 half-year figure of 254,664 million yen (£1.063 billion). Operating income was 17,322 million yen (£72.35 million), down from the previous year’s 18,466 million yen (£77.13 million), and ordinary income for the half-year was 17,231 million yen (£71.97 million), up from the 2006 half-year result of 13,819 million yen (£57.72 million). Net income was 8,159 million yen (£34.08 million), a significant jump on the half-year 2006 result of 1,924 million yen (£8.04 million).

Net sales of tyres to unaffiliated customers equalled 211,715 million yen (£884.26 million), while operating income was 12,796 million yen (£53.44 million).

13th August 2007/by Tyrepress Editors

Quarter Profits up at Superior Industries

OE alloy wheel supplier Superior Industries International announced their financial results for the second quarter of this year on August 9, figures that show a solid increase in unit wheel shipments, net sales, gross margin and pre-tax income from continuing operations compared to the second quarter of 2006.

“The benefits of our hard work during the past several years to improve productivity, reduce costs, and position Superior for success as a truly global company are becoming increasingly evident in our financial performance,” said chairman, president and CEO Steven Borick.

For the three months ended June 30, 2007, net sales increased 16.1 per cent to US$255,217,000 compared to $219,880,000 for the second quarter of 2006, driven by a 3.7 per cent increase in unit wheel shipments, a higher percentage of large-diameter wheels in the sales mix than in the prior year, and higher pass-through aluminium costs in selling prices.

10th August 2007/by Tyrepress Editors

Bridgestone H1 Results Highlight Across the Board Growth

On August 9 Bridgestone released its consolidated business and financial results for the January 1 – June 30 period. Net sales during this half year, at 1615.6 billion yen (£6.69 billion), were up 13 per cent on last year, an increase partially brought about through an exchange gain on the weaker Japanese yen. Operating income increased 21 per cent from 84.1 billion yen (£348 million) to 102 billion yen (£422.16 million) and ordinary income increased 29 per cent to 91.3 billion (£377.88). Net income, at 52.9 billion yen, was 61 per cent higher than a year earlier.

Operating income from the sale of tyres increased 30 per cent to 70 billion yen (£290 million) on a 15 per cent increase in sales, to 1304.7 billion yen (£5.4 billion). Bridgestone states that it sought to maximise tyre sales momentum through the ongoing introduction of new products worldwide, while at the same time expanding strategic production sites in support of products that have been identified as important to the company’s growth.

9th August 2007/by Tyrepress Editors