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US OTR Probe Ruffling Feathers in China

US Treasury secretary Hank Paulson’s two-day visit to China has conveyed his government’s desire for greater Chinese market access for overseas firms to officials in Beijing. Mr. Paulson met with China’s president Hin Jintao plus a number of finance and economic ministers, and used the opportunity to push for increased financial sector liberalisation, emphasising the benefits a loosening of regulations would bring.

“For the life of me, I cannot understand why China letting in strong foreign firms, which are regulated by the Chinese, would undermine stability. It would help stability,” he said. However this talk of increased China access comes at a time when tension between the two giant economies is growing. On July 31 the US Commerce Department agreed to investigate claims that Chinese OTR tyre producers were ‘dumping’ their products in the US market.

2nd August 2007/by Tyrepress Editors

Sameer Seeks Government Subsidies

Kenya based Sameer Africa Ltd has asked the Kenyan government to provide subsidies to local manufacturers so they can counter rising energy costs and remain competitive. The manufacturer of Yana brand tyres has made this call following government requests to the Kenya Association of Manufacturers (KAM) to transfer some of their production to off peak times in which there is lower demand for electricity.

Sameer Africa’s chairman, Naushad Meralli, believes high energy costs are a large contributor to local manufacturers’ diminishing competitiveness. “This increased costs will diminish our ability to compete effectively domestically and in the export markets, which are also attractive to our competitors with lower power costs,” he said.

24th July 2007/by Tyrepress Editors

New Hankook Plant Under Fire from Unions, Locals

Within a month of opening the Hankook factory in the Hungarian town of Dunaújváros has become the subject of labour law breach allegations. These complaints from union representatives, including accusations that plant management has not adhered to conventions established by the International Labour Organisation and the EU, have resulted in employment inspectors visiting the facility.

Amongst the union’s list of grievances are accusations of illegal dismissal of workers, late payments, no extra pay for overtime, company discouragement of union activity and unsanitary working conditions. Following investigation by Hungary’s Employment and Work Safety Authority a report on the matter is due to be released and the end of July.

Hungarian government plans to provide Hankook with 92.6 million euros worth of subsidies in order to eventually increase the number of employees at Dunaújváros to 1,500 have been approved by the European Commission. However, senior union representative Tamás Székely has said he intends to meet with Hungarian Prime Minister Ferenc Gyurcsány and insist the government withhold these subsidies until the union is satisfied all labour issues have been resolved.

24th July 2007/by Tyrepress Editors

JV Partner Sought for India’s TCI

The Indian government’s wholly owned and ailing tyremaker, Tyre Corporation of India (TCI) is looking for a joint venture partner to help revive its fortunes. India’s Economic Times newspaper has reported that the government plans to attract a partner that can provide both the latest global technology and pan-India product marketing support.

An official from India’s Ministry of Heavy Industries told the Economic Times: “The matter now lies with the Parliamentary Standing Committee on Industry for a final approval, after a bill (the Disinvestment of Ownership Bill, 2007), was introduced in parliament in May. As and when it is passed, we would move ahead with the revival of the sick unit, through the disinvestment route.”

20th July 2007/by Tyrepress Editors

Chinese Govt Defends tyre Quality

In response to legal action initiated by US tyre importer Foreign Tire Sales, China’s official quality control organisation, the General Administration of Quality Supervision, Inspection and Quarantine, has spoken in defence of Hangzhou Zhongce Rubber.

“There should no worries about tyres made in China,” commented Wang Xin, a senior official with the government body. He further added that the tyres were “qualified to be sold in the US.” Xin’s comments are in line with those expressed by Hangzhou Zhongce, who state that their own inspections have not found any of the faults reported by Foreign Tire Sales, and that none of the company’s other US customers have expressed concerns about the reliability of the tyres they purchased.

The controversy surrounding the Foreign Tire Sales case has sparked a wider debate on Chinese imports into the US, with some calling for tighter restrictions on what is allowed into the country.

18th July 2007/by Tyrepress Editors

Liberian BFS Workers Elect New Union Leaders

Workers in Liberia have elected union leadership to represent them in contract talks with Bridgestone/Firestone, the first time that workers themselves have elected their representatives. The election was monitored by representatives from the US unions United Steelworkers Union and American Federation of Labor and Congress of Industrial Organizations at the invitation of a government created elections commission.

The BFS plantation in Liberia has been the scene of a number of strikes in recent times and has received unfavourable reports from Western human rights organisations. The elections were thus seen by many as a positive step. In the words of the USW, “all eight elected union positions were won by militant activists who had participated in training by the USW and had led wildcat strikes over the past two years.”

12th July 2007/by Tyrepress Editors

Canadian Government Wants Proof of Chinese-Made Tyre Defects

(Akron/Tire Review – Canadian Press) Transport Canada has said it needs more proof that Canadian drivers are at risk before it will consider following a U.S. recall of allegedly faulty Chinese-made tyres.

“We don’t need crashes or injuries or death, but we do need evidence,” said Lars Eif, chief of defect investigations and recalls at the federal ministry.

10th July 2007/by Tyrepress Editors

Put the Brakes On

Which asks if faulty Vauxhall handbrakes are to blame for ‘roll-away’ accidents?

Drivers are blaming Vauxhall handbrakes for a series of ‘roll away’ accidents that have seen cars release themselves and crash. According to a Which?, report more than a dozen cases involving both Vauxhall Vectras and Signums that have careered into other cars, trees and houses have been reported.

The government’s car safety watchdog, the Vehicle and Operator Services Agency (Vosa), says it is investigating several cases but to date has found no problem with the design or construction of handbrakes. Vauxhall told Which? it was aware of a small number of incidents. The company is now planning to inform all Vectra and Signum owners about the correct way to put on the handbrake.

9th July 2007/by Tyrepress Editors

Subcommittee to Hold Hearing on Chinese-Made Products

(Akron/Tire Review) The Senate Commerce Committee’s Interstate Commerce, Trade and Tourism Subcommittee has scheduled a hearing to discuss Chinese product safety, according to Dan Zielinski, vice president of communications for the Rubber Manufacturers Association. The hearing is scheduled for July 18. Byron Dorgan (D-ND) is chair of the Subcommittee.

NHTSA Administrator Nicole Nason will testify on the recent Hangzhou/Foreign Tire Sales tyre situation, Zielinski said. Additional government witnesses tentatively scheduled include representatives of the Consumer Product Safety Commission, Food and Drug Administration and a Seafood Inspection representative.

Meanwhile, Foreign Tire Sales said it is in the process of establishing a toll-free hotline and expects it to be in effect by July 16. It also stated it would send notification letters to its customers as well as release details of the recall plan on its Web site at www.foreigntire.com.

Earlier in the week, Foreign Tire Sales submitted a recall plan to NHTSA. The government agency is currently reviewing it.

9th July 2007/by Tyrepress Editors

CIMS Commentary on Chinese Tyre Recall

(Akron/Tire Review) Federal regulations require that tyre purchasers have a right to have their tyres registered at no charge, so they will be directly notified in the event of a safety related recall to have the tyres removed from the highway as quickly as possible.

[Editor’s Note: CIMS, which produces and sells tyre registration materials in North America, issued a press release yesterday regarding the current recall situation involving Chinese produced tyres. While the release itself contained no news – only commentary – the comments of CIMS president Paul Kruder regarding the matter may be of interest to readers.]

“As a result of the recent government ordered tyre recall of at least 450,000 Chinese produced tyres, questions regarding tyre safety are dominating the headlines once again. Tyre purchasers need to protect themselves and make sure their tyres are registered.

4th July 2007/by Tyrepress Editors

Change in Chinese Export Rules May Lead to More Tyre Price Increases

(Akron/Tire Review) Effective July 1, the Chinese government will reduce, and in some cases eliminate, VAT (value-added tax) refund rates given to companies exporting certain goods out of China. More than 2,800 product classifications – including rubber, steel and carbon – will be affected by the reductions, the third change in refund rates since 2005.

China is making these changes to address overwhelming export growth and attempt to manage its trade surplus. Traditionally, export VAT refunds have kept export prices low for tyremakers and tyre- and wheel-component suppliers exporting out of China. According to an Ernst & Young report released June 20, “any change to a VAT refund rate will impact the prices charged on export goods as well as the profitability of exporters.”

29th June 2007/by Tyrepress Editors

Home Away From Home

Less than a year after a ground-breaking ceremony was held at the Dunaujvaros Industrial park in central Hungary, Hankook Tire celebrated the official commencement of production at its first European factory. To mark this momentous occasion the very first tyre, an Optimo K715, made its way through the 56 hectare plant’s assembly and vulcanisation facilities, and upon completion a small ceremony was held in which this first tyre was signed by the company’s global CEO Seung Hwa Suh, the Hungarian Minister of Economy and Transport Janos Koka together with Eom Seock Jeong, the Korean Ambassador to Hungary.

“We are very glad to be welcomed by the Hungarian government, by the people of Dunaujvaros and the whole region”, said Mr. Suh. “From the start of this project in late 2005 to the production of our first tyre made by Europeans for Europeans, Hankook Tire has been in the safe and reliable hands of our Hungarian partners. We owe a debt of gratitude to the support we have received from both the Hungarian government and from the warm and generous welcome of the people of Dunaujvaros to everyone from the Hankook Tire family.”

28th June 2007/by Tyrepress Editors

Challenge Bibendum Returns to China in 2007

Michelin’s Challenge Bibendum has been seeking solutions to the downside of motoring since 1998, and this year the event returns to the city that last played host to the Challenge in 2004 – Shanghai, China’s largest city and economic hub. This choice of venue is particularly appropriate given China’s growing global profile and its status as the world’s fastest growing vehicle market and vehicle producer, and a brand new location – the Automotive Exhibition Center, part of the Shanghai International Automobile City (SIAC) – has been selected to host the event between November 14 and 17.

As in previous years Challenge Bibendum will tackle pressing issues such as CO2 emissions, traffic congestion, vehicle fatalities and security of fuel supply. And while each of these problems has been present in the West for some time, the burgeoning economies of the world’s most populous countries, China and India, has created a new urgency for the development of alternatives to the status quo. Challenge Bibendum recongises that the change to more environmentally, economically and socially responsible vehicles and infrastructure will not occur organically, and thus entrepreneurs, industrialists and scientists from around the world have been invited to Shanghai to share their vision and present technical solutions to policy makers and the media.

25th June 2007/by Tyrepress Editors

Sun Tyres Expects 25 per cent Increase in Retread Demand

Sun Tyre Industries Sdn Bhd, a leading Malaysian retreaded tyre manufacturer, expects retread demand to go up by 20 to 25 this year. The company made the prediction on receiving the MS224:2005 certification on 21 June. Executive director, Steven Gan Seng Poe, said demand for retreaded tyres in Malaysia was always high and that the company was confident of meeting the demand as they planned to increase production at their new plant in Kota Kinabalu, Sabah.

The production at the plant would be raised to about 9,000 units a month by year-end compared to the current production of 2,000 units a month. According to local news source Bernama, the Seremban-based company currently produces 25,000 retreaded tyres a month, which are mostly used for commercial vehicles.

22nd June 2007/by Tyrepress Editors

Tyremakers Meet to Address Cartel Allegations

In an attempt to address allegations of cartel behaviour amongst Indian tyremakers the Automotive Tyre Manufacturers Association (ATMA) and the Competition Commission of India (CCI) have met to discuss the issue, and negotiations have begun on the possibility of implementing a compliance programme to eliminate such practices, whether they be planned or unintended.

While a probe conducted by India’s Monopolies and Restrictive Trade Practices Commission has been stalled since the early 1990s due to a high court stay obtained by a leading tyre manufacturer, India’s tyremakers deny the claims of cartelisation, and reportedly seem eager to participate in discussions that will wipe away any blemishes remaining from past anti-competitiveness allegations or investigations.

8th June 2007/by Tyrepress Editors