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India’s third largest tyre manufacturer, JK Tyre & Industries Ltd (JK Tyre), has made no secret of its plans to increase domestic market share in key segments and to seek out new export markets, but bringing these goals to fruition requires the expansion of the company’s existing production capacities. Therefore JK Tyre has its eye on making an investment of somewhere between £60 million and £75 million in this area over the next three years.

President of JK Tyre, Mr. Arun K. Bajoria, recently spoke to the respected Indian daily publication Hindu Business Line regarding the steps his company was making towards realising its aims. “The expansion will be across the four existing facilities and the investments would be spread over the next three years,” he stated. “But in the next 12 months we would be first investing around Rs 120 crore (£15 million) for increasing the capacity by around 50 per cent in the off the road tyres segment used by the mining, cement, coal and earth-moving sectors.”

22nd May 2007/by Tyrepress Editors

Sobering 2006 Financials for PT Gajah Tunggal

Recently released income statements indicate that PT Gajah Tunggal Tbk, manufacturers of the GT Radial brand and ranked as one of the world’s 30 largest tyremakers, had a challenging year during 2006.

While net sales for the company increased by 13.2 per cent to 5,470 billion Indonesian rupiahs (£314.4 million) in the year to December 31, 2006, operating income dropped from 407 billion rupiahs (£23.4 million) at the end of 2006 to 365 billion (£21.0 million) a year later. Net income dropped a worrying 65.9 per cent to 118 million rupiahs (£6.8 million).

Quarterly figures confirm the trend towards higher sales yet lower income, with quarterly net sales in the period to March 31, 2007 posted as 1,535 billion rupiahs (£88.2 million) as opposed to 1,229 billion a year earlier. Operating income increased from 111 million rupiahs (£6.4 million) to 171 million (£9.9 million). However net income for the quarter was scarcely a fraction of that gained a year earlier, down from 215 million rupiahs (£12.4 million) in March 2006 to just 12.9 million (£739,000) this year.

16th May 2007/by Tyrepress Editors

Hayes Lemmerz Reports Estimated Q1 Results

On May 15 Hayes Lemmerz International, Inc., global supplier of wheels, brakes and powertrain components, announced their estimated results for the first quarter of 2007 and issued updated guidance for the 2007 full fiscal year. The estimated results are unaudited, have not been reviewed by the company’s independent auditors, and are subject to adjustment during the course of preparation and review of the Hayes Lemmerz quarterly financial statements.

For the fiscal year first quarter 2007 Hayes Lemmerz expects to achieve sales of approximately US$560 to $565 million, Adjusted EBITDA of approximately $54 to $58 million, slightly negative free cash flow and capital expenditures of approximately $16 million.

16th May 2007/by Tyrepress Editors

Riding the Wave

The surface acoustic wave (SAW) tyre pressure monitoring technology that Transense Technologies plc has specialised in since the company’s establishment in 1991 will be used to produce the automotive industry’s first piezo-electric surface acoustic wave (SAW) sensor based system. In mid-May Texas Instruments announced their selection of Transense Technologies’ TMS3 20F28X digital signal controller as a key component in the development of this new system, a decision that will see the Oxford-based company supplying a market where, come September 1, all new light motor vehicles registered must be equipped with tyre pressure technology that alerts drivers of significant tyre under-inflation.

16th May 2007/by Tyrepress Editors

Congress’ CAFÉ Boost Plan Includes RMA’s Fuel Efficiency Provision

(Akron/Tire Review – Detroit News) The drive to hike fuel efficiency standards took a dramatic step forward May 8 when a Senate committee approved a 40 per cent increase over the next decade. SR 357 also includes a RMA-written amendment that would create national tyre rolling resistance standards and grading system.

Sen. Maria Cantwell (D-WA) included the tyre rolling resistance amendment, which RMA calls a “consumer education program.” RMA said the amendment was similar to HR 5632, which was passed the House Energy and Commerce Committee last year but never made it to the full House.

Democrats vowed to hold a full Senate vote sometime next month on the CAFE standards bill, which requires automakers to raise the average fuel economy of their vehicle fleets to 35 miles per gallon by 2020, a move the companies denounced as unrealistic.

The bill was unanimously approved by the Senate Commerce Committee, making it the first fuel economy bill to pass that hurdle since 1991. The move sets the stage for a major battle over new rules that could cost automakers tens of billions of dollars.

15th May 2007/by Tyrepress Editors

Beru – Quarter Figures Show Mixed Results

Tire Safety System (TSS) manufacturer Beru AG has posted total sales revenues of 116.8 million euros for the first quarter of the 2007 financial year, nearly equalling the sales revenues (117.4 million euros) of the prior-year period. Earnings before interest and taxes (EBIT) reached 14.8 million euros, slightly down from last year’s 17.3 million euros and equivalent to an operating margin of 12.6 per cent.

The company’s Electronics and Sensor Technology division maintained its status as growth area during the quarter, with first quarter sales revenues of 38.8 million euros recorded during the quarter, an increase of 16.6 per cent over the previous year. Beru report that their TSS system was largely responsible for driving this growth.

15th May 2007/by Tyrepress Editors

Pirelli Tyre Post Positive Quarterly Figures

Pirelli &C. SpA have released company financial figures for the quarter up to March 31, 2007, and this data indicates a largely positive three months for Pirelli Tyre. In the first quarter of 2007 Pirelli Tyre registered a 6 per cent increase in sales, in spite of a negative exchange rate effect, and although faced with increases in raw material prices operating income rose compared with the same period in 2006.

Revenues as of 31 March 2007 were equal to 1,060 million euros, up from 1,000.4 million euros in the first quarter of 2006, an increase of 9.1 per cent on a like-for-like basis, net of any exchange rate effect. EBITDA was equal to 150.9 million euros.

Operating income amounted to 103.7 million euros, an increase of 4.5 per cent compared with the first quarter of 2006 when operating income was recorded as 99.2 million euros. The ratio over sales was substantially unchanged compared with last year, despite increases in raw material costs.

14th May 2007/by Tyrepress Editors

Michelin Holds Annual Shareholders’ Meeting

Michelin’s annual shareholders’ meeting was held in Clermont-Ferrand on May 11, and managing partner Michel Rollier submitted to the shareholders a number of proposed changes in the area of Michelin Group corporate governance. Of particular significance was the proposal that “the [Group’s] management be enlarged to non-general managing partners in order to guarantee the sustainability as well as collegial nature of its management”.

The resolutions submitted for shareholder vote – 18 in total – were approved by a sizable majority, and the company’s bylaws were amended accordingly. Mr. Didier Miraton, Head of Research and Industrial Performance and Mr. Jean-Dominique Senard, Chief Financial Officer, were appointed Non-General Managing Partners. Commenting on the changes, Mr. Rollier stated he was convinced that he and the two new managing partners, would form “the close and efficient team Michelin needs to rise to the challenges confronting it”.

14th May 2007/by Tyrepress Editors

Sub-Standard Imported Tyres Lasting only 500km – Botswana Report

The general manager of Botswana’s Central Transport Organisation (CTO), the government body responsible for providing and maintaining all government fleet vehicles in that country, claims his government has spent some £255,000 on sub-standard tyres during the last financial year. Lt. Col. (ret) Moakofhi Modisanyane has reportedly stated that the blame for the poor quality of tyres supplied to the CTO lies with tyre dealers, whom he claims have acted to maximise their own profits at all costs.

Following a number of complaints from government vehicle users about tyres prematurely wearing, inspections were made of CTO facilities. Sub-standard tyres have been found at several CTO depots. Reports indicate that these tyres were manufactured in Europe and Asia, although were sourced locally. Brand names singled out as those wearing prematurely include West Lake Tire from China and Kyro.

11th May 2007/by Tyrepress Editors

Lanxess Signs Long-Term Contract with Hankook

Lanxess AG has announced that its Polybutadiene Rubber business unit has signed a five-year supply contract with South Korean tyre manufacturer Hankook Tire. According to the AFX news agency, no financial details were disclosed. Lanxess’s Polybutadiene Rubber business unit is part of the company’s Performance Rubber segment, which reported sales of 1.776 billion euros in 2006.

9th May 2007/by Tyrepress Editors

Bandag Reports First-Quarter Financials

(Akron/Tire Review) Bandag Inc. released financial results for the first quarter of 2007.

Consolidated net sales were $227.0 million, compared to $212.4 million in first quarter of 2006, an increase of 7 per cent.

Consolidated net earnings were $14.9 million for the first quarter of 2007, compared to first quarter 2006 consolidated earnings of $5.7 million.

North American business unit volume increased 2 per cent, while net sales decreased 1 per cent. TDS net sales decreased $0.3 million, or 1 per cent. Consolidated operating and other expenses decreased $9.6 million, or 15 per cent, compared to the prior year period. Operating and other expenses decreased in all business units with the exception of vehicle services.

27th April 2007/by Tyrepress Editors

Analysts: Nokian 1Q EBIT 80 per cent Above Expectations

Financial analysts at Deustche Bank have commented that Nokian’s first quarter performance as clearly exceeded expectations. Nokian’s 200 million euros of net sales and 39 million euros of pre-tax profits were described as “16 per cent and 80 per cent better than expected, largely driven by strong demand in Russia for both summer and winter tyres. Furthermore the company’s mix of winter tyres was said to be “clearly better in first quarter than it was last year.”

26th April 2007/by Tyrepress Editors

Goodyear Extends Maturities, Reduces Interest Rates

The Goodyear Tire & Rubber Company announced on April 20 that it has closed on an amendment and restatement of three of its credit facilities. Significant changes to the amended and restated agreements include:

– With respect to the company’s $1.5 billion asset-based revolving credit facility, an extension of its maturity until 2013, a reduction of the applicable interest rate by between 50 and 75 basis points (depending on availability of undrawn amounts) and a more flexible covenant package.

– With respect to the company’s $1.2 billion second lien term loan, an extension of its maturity until 2014, a reduction of the applicable interest rate by 100 basis points (to be further reduced by 25 basis points if Goodyear’s credit ratings are BB- and Ba3 or higher) and a more flexible covenant package.

26th April 2007/by Tyrepress Editors

MRF Chooses SAP to Provide Software Solutions

Indian tyre major MRF Ltd has chosen business solutions provider SAP to provide assistance in its efforts to enhance its global operations through the company’s ‘SAP for Automotive’ set of solutions, which includes enterprise resource planning and customer resource management software.

As a company exporting to more than 75 countries MRF needs to be prepared for fluctuations in the global supply and demand of everything from raw materials to finished products while still meeting strict shipment deadlines. Furthermore, in the increasingly competitive global tyre market, it is essential that tyremakers such as MRF be able to timely monitor and respond to competitor’s pricing and special offers. By using SAP MRF will be able to seamlessly integrate logistical and financial data, eliminating redundant work and saving time and operational costs.

24th April 2007/by Tyrepress Editors

Michelin to Double Tyre Donations to Emergency Crews

(Akron/Tire Review) Michelin North America plans to double the number of tyres it will donate to local fire and EMS departments as part of its Driving America’s Safety program. The company has already donated tyres to 25 first-responders this year.

Beginning today, communities and individuals can nominate their local fire and/or EMS teams to receive a set of new Michelin tyres. Nominations will continue through Nov. 23. For 2008, MNA will donate 50 sets of tyres to local first responder units.

24th April 2007/by Tyrepress Editors