India
The Xinhua News Agency, China’s official press service, reports the country’s Ministry of Commerce “appreciates” India’s decision to terminate a trade investigation into Chinese manufactured passenger car tyres. According to Xinhua, a statement on the ministry’s website says the decision “decision would not only help boost the steady development of bilateral trade ties, but also benefit the downstream businesses of India.”
Car and two-wheel vehicle tyre prices in India have recently risen by some five to seven per cent due to unprecedented demand and reduced manufacturer inventories. According to India’s The Economic Times newspaper, tyre manufacturer’s inventories have declined from 20-25 days to just 5-7 days of late, disrupting vehicle production. The price increases mean that vehicle manufacturers also need to absorb the additional cost of around Rs 800 (£10.75) in each new car they sell.
Michelin’s first ever global advertising campaign got underway on October 6. The new campaign’s theme – “The right tyre changes everything” – is intended to illustrate the competitive advantages of Michelin tyres in media outlets around the world. The French manufacturer states it decided to launch what it calls an “unconventional” global campaign as a response to today’s increasingly competitive business environment.
Tyre business systems provider, Cam Systems, has signed an exclusive distribution agreement with EDP France and EDP UK for the UK tyre industry. The move is being seen as a significant step today in the company’s “business process optimisation strategy” and as a move towards RFID. The agreement covers all software and local support and installation services associated with EDP’s products, incorporating the company’s desk bound management platforms: Tyre parc; Fleet Check; and Fleet Check Lite.
Mike Allen, managing director of Cam Systems explained: “As service providers in the UK seek to increase productivity whilst also saving process costs, it became apparent that we needed to provide them with an option for a world class fleet inspection platform. The EDP software was designed in France, largely in conjunction with Michelin Europe, so its development credential is superb."
Around 400 guests filled the Deansgate Suite at the landmark Manchester Hilton Hotel to celebrate the 80th NTDA annual dinner and the 2009 Tyre and Fast Fit (TAFF) awards ceremony. The event, held on the evening of 23 September, saw the industry’s brightest and best gather to celebrate the successes of an industry that is determined to tough out the recession. The turnout alone spoke volumes about the attitude of the business’ leaders, with NTDA chairman Peter Gaster’s speech highlighting the challenges and successes of the industry; and the TAFF awards themselves recognising the achievements of companies within the business. This year’s event was sponsored by ECI International (the organisers of Brityrex, Tyrexpo Asia, Tyrexpo Africa and now Tyrexpo India); well known logistics firm DHL and Tyres & Accessories (and website tyrepress.com), the industry’s leading tyre trade publications. The TAFF awards themselves were compered by Mark Harrison on behalf of ECI International and after dinner entertainment was provided by Ian Irving.
Following the publication of 20,000 voting slips by Tyres & Accessories and the NTDA, and after hours of dedicated vote-counting, the 2009 awards were presented to successful candidates with tyre industry equivalent of “the red carpet treatment.” The fifth NTDA TAFF Awards also differed from previous competitions as it was the first time online voting had been included. In addition to the awards decided by the normal one industry member one vote system, and the NTDA nominated chairman’s award, 2009 saw the introduction of an expert judging panel to decide this year’s innovation award. The panel was made up of the representatives from associations and trade publications including NTDA, TIF, GEA and Tyres & Accessories. And now the results…
Production at JK Tyres’ plant in Kankroli, Rajasthan, were disrupted this past weekend by a sit-in strike by a group of plant workers.
There was no word on the size of the strike or the impact it had on actual tyre production. Efforts were being made to quell the strike, reports said. (Tire Review)
A Deutsche Bank analysis of the global tyre market in 2008 has revealed that the global top 11 tyre manufacturer’s share of said market has fallen considerably in this decade, while the market capacity has swelled to twice its value (not allowing for inflation) at the turn of the millennium – US$140 billion compared to 69.78 billion in 2000. In addition, the Global Big Three (Bridgestone, Michelin and Goodyear) have seen their market share dwindle to 46.2 per cent. In the four previous recordings, taken by Deutsche Bank at five-year intervals, their share had not dipped below 52.1 per cent. Analysts attributed the downward trend to the fact that they have a below average share of the markets that are growing most rapidly, such as China. The news is affecting Goodyear most of all, since they have reportedly lost three times more market share than either Bridgestone or Michelin.
When Hankook executives announced details of their plans to expand production at the company’s Dunaujvaros, Hungary factory earlier in September, the Financial Times reported that either an Indian or Malaysian plant are next on the list. In answer to Tyres & Accessories/tyrepress.com questions, Calvin Pak, Hankook team manager corporate communications, explained that these countries are indeed being considered, but that sites in Mexico and Brazil are also being looked into. Acquisitions of existing plants or companies are also said to be an option. However, no final decisions have yet been made.
Within 24 hours of Continental AG confirming it is partnering with Modi Tyres to make bias truck tyres in India, and after a month of local speculation that the company will now buy a stake in the Indian tyre maker, financial analysts are reporting that the company “can’t afford making any acquisitions or expansion projects in emerging markets which are growing fast.”
Rather “all free cash flow generated by the rubber business should be used to reimburse the group’s high net debt of 10 billion,” Deutsche Bank analysts wrote in an investor’s note published today (23 September). Continental’s tyre business reportedly generates 500 million euros of annual free cash flow.
Continental AG’s Commercial Vehicle Tires division has confirmed reports that it has revived its collaboration with Modi tyres Company Private Ltd. (New Delhi). According to the company, Modi will initially produce around 1 million Continental-branded cross-ply truck tyres for the Indian market. As a result of the move, the company has secured access to the 12 million commercial vehicle tyre-strong Indian market, which has been projected to grow at around 7 per cent. Production already began at the start of June 2009.
The collaboration includes a technical cooperation agreement and a license agreement for Continental brand bias tyres. The Continental bias tyres will be distributed via a revived Modi sales network. “For us, this new agreement represents an extremely useful revival of our activities in India, a market, which we know will grow significantly over the coming years,” Continental project manager Christian Sass explained. Bias products still account for over 90 per cent of the Indian market.
Tire Review/Reuters – Trade measures of the type imposed by the United States on Chinese tires run the risk of spilling over and slowing economic recovery, a senior World Trade Organization (WTO) official said on Thursday. The tyre trade dispute blew up between the United States and China after Washington imposed additional duties on Chinese-made tyres last Friday, accusing Beijing of flooding the US market.
Indian cricketing icon, Sachin Tendulkar has left the MRF dressing room, following ten years with the tyre-maker and sports equipment manufacturer. During this time, Tendulkar spent weeks at the crease, helping spread brand awareness by carrying MRF’s logo on the front of his perfectly straight bat. The Little Master will now promote equipment for Adidas, while relative – though impressive – new-boy Gautam Gambhir steps into the Sachin-shaped hole with MRF.
Tire Review has compiled a variety of news stories based around the introduction of tariffs on imported China-made passenger tyres. Here is a sampling of the most relevant items from the past day:
CARE Research has published a new paper detailing the Indian tyre industry. Divided into three sections, covering the five-year period between 2003 and 2008, the basics of the industry and a detailed analysis of the top five players in the industry (Apollo Tyres Ltd, Ceat Ltd, MRF Ltd, Goodyear India Ltd and JK Tyres & Industries Ltd), the report aims to give readers a full understanding of all things tyres in India. Domestic and export markets will be covered. It will be available at http://www.aarkstore.com/reports/Indian-Tyre-Industry-17039.html.
Ceat Ltd. in partnership with Total Lubricants, has organised an “interactive knowledge platform” called Ceat Pro in Nagpur, India. The idea is to give customers access to best practice ideas to help them their businesses and reduce operation costs.
According to the company, Ceat Pro is intended to be a common platform for sharing information and resources. Panellists at the event spoke on fuel economy, trends in the India lubricant market, the use of telematics to increase fleet efficiency, and crucially tyre radialization and the future of tyres in India.
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