Bridgestone Corporation reports that the financial crisis and resultant global economic slowdown has created a necessity for it to revise the consolidated financial projections for the fiscal year ended December 31, 2008 that were originally announced on August 8. These downward changes have mostly been caused by decreasing tyre sales in Europe and North America, the company says.
Cam Systems is on the hunt for IT professionals interested in careers with the tyre industry’s leading software supplier. The company launched a recruitment drive towards the end of 2008 designed to fill seven full time vacancies covering a variety of roles in project management, installations, helpline support and financial accounting. Three of the positions were filled by the end of the year but four more staff will be added in early 2009 as Cam gears up for continued growth and expansion.
Accounts assistant Petri Conradie, a member of the Chartered Institute of Management Accountants has been hired to provide back-up for Cam’s suite of accounting software; customer support technician Nick Berry and installations and support technician Michael Indruch have also joined the company. All three will all be in place by early January, helping to bolster customer support services and functions.
Statutory negotiations at Nokian Heavy Tyres were concluded on December 19 with the company taking the decision to lay off a number of employees for approximately six months. Nokian cites the decreased demand for heavy tyres demand caused by the financial crisis and a subsequent reduction in production, as the reason behind the lay-offs.
The statutory negotiations at Nokian Heavy Tyres ended on the 19th of December, 2008 with the decision to lay off the employees for approximately six months. The reason for the lay-offs is the decreased heavy tyre demand caused by the financial crisis, which has created the need to reduce production in line with the lower demand.
The decision concerns some 280 employees and all personnel groups at Nokian Heavy Tyres. Depending on the job, the lay-offs will last from 10 to 100 days, which corresponds to the lay-off of around 90 employees for six months. The majority of lay-offs will be carried out from January to June 2009. Part of the adjustment needs will be executed by pension arrangements. The walkout of Nokian Heavy Tyres production personnel which started on Thursday, December 18, 2008 ended on December 19, 2008 at 10.30 a.m.
An American woman that embezzled more than US$200,000 from Bridgestone Firestone over a nine-year period will avoid spending time in prison after pleading guilty to theft and two counts of forgery. Janet Lazdins from Indianapolis pleaded guilty in August to taking around $215,000 from the company between 1997 and 2006, and on December 15, Madison Superior Court 3 Judge Thomas Newman on Monday gave her a three-year suspended prison term and ordered her to spend three years on probation.
The report published by Morgan Stanley Research Europe says it all: “If investors thought tyre data was poor in October, it just got worse…” What this memorable sentence refers to is data released by Michelin on December 18, which shows the supposedly more resilient passenger car tyre replacement market to be down in Europe 10.3 per cent in November, and in North America by a hefty 20.2 per cent. OE sales in the segment dropped a spectacular 33.5 per cent in Europe and 31.2 per cent in North America.
Cabot Corporation reports it is expecting a significantly lower volume of sales in the first quarter of the 2009 financial year, and has decided to embark on a series of “aggressive actions” to address these ongoing market challenges.
“Global weakness in the tyre, automotive and construction industries, intensified by customer inventory reduction, is causing significant volume declines during the first quarter of fiscal 2009 in each of our major geographies,” said Cabot president and CEO Patrick Prevost. “First quarter volumes in our Rubber Blacks, Performance Products and Fumed Metal Oxides Businesses are expected to be 20-30 per cent lower than in the same period last year.
Schaeffler Group has signalled that it is willing to consider abandoning the investment restrictions it agreed earlier this year to pacify its hostile takeover of Continental – much to the annoyance of Conti executives. Schaeffler sources told Financial Times that the investment agreement had become obsolete “as it was constructed at a time when the world was very different.” The agreement limits the ball-bearing maker to a 49.99 per cent stockholding in Continental and upholds the tyre and automotive supplier’s independence as a legally separate entity.
Schaeffler initially said it was only interested in holding a minority stake in Conti, however, as it stands the company holds the rights to more than 90 per cent of the shares. In addition, on 14 December Frankfurter Allgemeine Zeitung’s Sunday edition printed an interview with Maria-Elisabeth Schaeffler and company chief executive officer Juergen Geissinger, in which the executives revealed they are seeking four seats on Continental’s supervisory board. According to Reuters, Schaeffler would like the four seats it is seeking to be occupied by company CEO Juergen Geissinger, CFO Thomas Hetmann, Maria-Elisabeth Schaeffler and her son Georg.
Amtel Vredestein N.V. (AVNV) has announced that its subsidiary company OJSC Amtel-Vredestein (OJSC AV), the holding company of the group’s Russian business, is no longer able to satisfy its creditors’ demands. The AVNV executive board has determined that, due to the financial difficulties AVNV faces, it will not be able to provide any additional finance to OJSC AV. This development, says the company, may have “consequences for the going concern status of AVNV”, given a number of guarantees provided by AVNV in favour of the creditors of OJSC AV.
Several changes have been made to the senior corporate finance staff at Goodyear Tire & Rubber. The company reports that Damon Audia, formerly vice president and treasurer, has been appointed senior vice president of finance and treasurer. His expanded role includes Goodyear’s investor relations and tax functions.
“Damon has been a key member of Goodyear’s finance organisation over the past four years, and he was particularly instrumental in the execution of the plans to refinance the company over the last several years,” said Goodyear executive vice president and chief financial officer Darren R. Wells. “He has demonstrated the type of leadership we need in this role as we address the challenges of today’s economy.”
Japanese manufacturer Suzuki has announced that it will not take part in next year’s World Rally Championship including its Junior counterpart, having competed in each of the last seven series. The company says that business concerns “caused by recent global economic turmoil” have caused it to review its financial commitment to the tournament.
A company statement said that “the organisation reviews every aspect of the operations and decided to focus on the core business functions such as the manufacturing system, environment technologies, and development of new-generation powertrains for cars. As a result, Suzuki concluded to suspend the WRC activities from 2009.” The team’s sponsors, which include Italian tyre giant Pirelli among their number, have agreed to end their current deals with the team.
Dunlop India is becoming something of a political hot potato in the run-up to the election in the Lok Sabha, the country’s house of representatives. With the support of West Bengal politician Mamata Banerjee, company chief managing director Pawan Ruia is reported by the Times of India to be perhaps placing political pressure on the West Bengal government to gain Dunlop India additional concessions of a nature normally reserved for ‘sick’ units; that is, companies that at the end of any financial year have accumulated losses equal to or exceeding their entire net worth. And the government, says the Times of India, is holding its tongue on political grounds.
Nokian Tyres reports that its fourth quarter sales have been “weaker than expected” and the company’s operating profit will be lower than the set target. The company says it will not reach its previously communicated sales target for 2008 of 1,150-1,200 million euros. This downward revised estimate comes in spite of an anticipated five per cent growth in group net sales during 2008, and operating profit that is estimated to be on the previous year’s level.
Continental AG reports the company is drawing what it calls ‘further necessary consequences for the closing fiscal year 2008’ following an extensive analysis of the substantial negative development that has taken place in the automotive industry in the six weeks to December 10. At the same time, the company is adapting operational measures for 2009 to the industry’s predictably poor economic environment. A cost-cutting programme, said by Conti to be in the ‘high three-digit millions range’ has been initiated; this programme includes the postponement of investments as well as the stretching of expenditures in the area of research and development.
Continental AG stood up to its major shareholder and takeover suitor, Schaeffler Group, on Wednesday (10 December) by refusing to sell the group’s tyre and rubber products business. Sources told the Financial Times that Conti’s supervisory board unanimously decided not to sell the company’s “rubber” unit, apparently rebuffing Schaeffer’s demands. Instead Conti’s board announced plans for a three-digit million euro cost cutting programme and said it is considering axing its dividend payment. FT’s source was also reportedly keen to stress that Continental should be in the driving seat of any industrial cooperation between the two companies: “We want to make it clear that, if David and Goliath go together, Goliath has to be in the drivers seat.”
Schaeffler Group’s 12.1 billion euro hostile takeover bid, launched earlier this year, cooled down slightly when former CEO Manfred stepped down and Dr Karl-Thomas Neumann took over in September. However, while FT reports that Neumann was Schaeffler’s preferred candidate, the newspaper also points out that “he has acted solely in the interests of Continental.”
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