Toyota will increase capacity at its UK plant in Burnaston to 285,000 vehicles by 2005 (220,000 at present). The addition investment will total 50 million pounds. The Japanese car maker has begun a program of increasing capacity in Europe to 645,000 vehicles from 500,000 previously.
Cooper-Avon Tyres Ltd has achieved record sales results in the first quarter of 2004. Four years ago the company implemented a new strategy to help safeguard its future. As part of this, the company has seen substantial investment in new processes and products in recent years and is growing at a rate of some 10 – 12% per annum. It is anticipated that this trend is set to continue in the foreseeable future.
For a number of years there has been little in the way of flotations on the German Stock Exchange, but suddenly there has been a flurry of activity. German Post wants to float its subsidiary Postbank on June 21, but the fast-fit service chain A.T.U (Auto-Teile-Unger) wants to forestall the Post and get in with its own flotation beforehand, at the beginning of June. The flotation is being handled by Credit Suisse First Boston and HSBC, who expect to raise one billion Euros. UK investment company Doughty Hanson is the majority shareholder and it is not yet known whether it will sell its entire holding or retain a stake in A.T.U.
Marangoni Tread’s factory at Madison, Tennessee has begun producing Ringtread spliceless precure tread rings. The timing is impeccable, as Marangoni’s business in North America continues to grow, with this year so far 50 per cent higher than 2003. The 50,000 square foot factory is part of a $10 million investment by Marangoni in US manufacturing, supplying the 15 Ringtread dealers currently operating in North America.
DaimlerChrysler (DCX) has ruled out giving any further financial support to Mitsubishi (MMC), in which the German company has a 37 per cent stake. This surprised analysts, who had been expecting DCX to invest up to 4 billion Euro, but is seen as a positive move with a beneficial effect on DCX cash flow.
Michelin Apollo Tyres would pump in about 67 million euro to set up a new plant at Ranjangaon in Maharashtra (India) to produce 350,000 bus and truck radial tyres annually. 51 per cent of the investment will come from Michelin, the balance from Apollo. As the production is scaled up in future so too will the investment.
Slovakia’s chances of becoming big in the automotive industry are strong, according to Jan Bajanek, head of the Slovak Investment and Trade Development Agency, as several Japanese, British, and US firms are considering Slovakia as the possible site for their new plants. Bajanek said to the state-run TASR news agency that a major US producer of trucks was considering investing 400 million dollars into a factory in Slovakia that would create 2,000 jobs. According to Bajanek, Slovakia is still in a good position for the Hyundai investment, and other Asian car producers, such as Mazda and Honda, are also considering coming to Slovakia whilst Rover and the Japanese tyremaker Bridgestone are considering investing in Slovakia, Bajanek said. All good news for Matador’s automotive products division.
Cooper Tire & Rubber Co. plans to substantially boost its high performance and ultra-high performance tyre market share in 2004, Cooper Chairman, CEO and President Tom Dattilo told analysts. The 2003 figure of 2 per cent market share is a half per cent ahead of 2002 and the company is said to be selling out of its Zeon UHP product. Meeting demand will depend upon increased reliance on Asian partners, but a 32 million dollar investment in the three USA plants will also contribute to meeting demand. Sales for the last quarter were a record 967 million dollars and tyre Group sales were up 6 per cent on the previous year.
Saba Tire Cord Manufacturing Complex of Iran has established a nylon tyre cord production facility about 15 km north east of Zanjan, Iran. The operation, which started up in April last year, is the largest such facility in the Middle East region, the company claims. Saba’s 600-employee facility has an annual production capacity of 15,000 tonnes of different tyre cord fabrics. Saba is owned by Rubber Industries Investment & Development Co., an Iranian holding company.
Alliance Tire has some unusual barriers to overcome in its search for continued success. However the Israeli tyre manufacturer is focussed and determined to grow.
Most tyre manufacturers have the ability, in today’s global market, to sell anywhere in the world, certainly to their neighbours. Alliance is denied that opportunity by being an Israeli company. Yet despite being perhaps a key industry in Israel, Alliance still has to operate on a free market basis. Denied access to the obvious Middle East market, for reasons we may not always comprehend but certainly cannot have failed to have noticed over the past 50 plus years, Alliance has to work doubly hard to gain market share. That takes determination. It takes loyalty. There is no possibility of failure, therefore everyone must work to win. To understand that drive is to understand why Alliance Tire, a small, single plant manufacturer in a beleaguered state, has the potential not only to survive but to take a leading role in its chosen market sectors.
Alliance has long taken the view that developing niche products for specialist markets is the way to proceed. It has therefore developed its own technology and products to gain respect and a leading market share in its chosen agricultural sector. The requirement to develop and refine placed a burden on the company loans. However, with the appointment of Joseph Anglister as General Manager there was a turnaround in fortunes at Alliance and once more the company was back in operating profit. The turnaround came as the result of efficiencies created by the investment allied to a reduction in the workforce. Today the Alliance workforce has vastly improved its efficiency in production. However, the investment continues and next year will see the installation of a new state of the art calendaring line for inner liners.
After the fire that completely destroyed the production plant at Marangoni’s German subsidiary Ellerbrock, North of Hamburg three weeks ago, the well known retread technology producer has stopped worrying about the past. Rather, Ellerbrock is occupied with plans for the future. The immediate goal is to reconstruct the plant by the end of next year, company officials told T&A. They didn’t reveal the total investment but will ensure that the new plant will process at least as much rubber as the old one, i.e. 15,000 tons per year. According to the plans, Ellerbrock’s new plant will become the most modern in Europe. In the meantime, 20 employees have been posted to two Marangoni plants in Italy in order to prevent the company from encountering delivery difficulties. For the first few weeks after the fire, Ellerbrock has been doing business from the stock.
Tyre disposal is an issue that affects everyone, not just those in the tyre business but every individual everywhere. If we don’t find a solution to tyre disposal we will have an enduring and ongoing waste tyre problem. The use of tyres as fuel in cement kilns is becoming an increasingly important option, although this route to disposal has been resisted by some local communities.
Sapphire was established with support from Lafarge and Michelin as a sustainable route of tyre supply to Lafarge, and as a ready route for the tyre industry to dispose of tyres in advance of producer responsibility. Jamie Randall, MD, says, “We do work closely with Michelin but we are keen to be seen as a an industry wide used waste tyre disposal route open to everyone.”
“The only reason tyres have a value, or rather a use, is because of the millions that Lafarge has invested in plant and equipment. If people have a dream of the gate fee disappearing then they are mistaken. Without the gate fee the operation loses much of its value and Lafarge would not be using tyres.
“We have to recognise that the funds to secure this high class disposal route are available: one way or the other every tyre changed from our cars attracts a charge at the retailer or elsewhere for its ultimate disposal.”
“It is important that the tyre industry keeps in mind that Lafarge is not in the business of processing tyres, it is in the business of making money, which it does through the manufacture of cement. In the meantime, technology and economics, if we allow the gate fee, mean that tyre use has become an important element of Lafarge’s, and others’, cement manufacturing process. That may not always be the case.”
Lafarge and Sapphire will argue that their investment requires a gate fee to ensure its ongoing profitability. The tyre sector will look at the fiscal benefits of using tyres as opposed to fossil fuels and argue that a lower gate fee at least could be accommodated. Ultimately Lafarge has the option of using tyres or other fuels. If it becomes more economical to burn sewage, for instance, then what happens to the tyres Lafarge would no longer require?
Continental has laid the foundation stone for a new plant at Sibiu, Romania, for its subsidiary Continental Temic, part of Continental Automotive Systems. The site will also include an R&D department, employing 170 staff, and the total investment is 20 million Euro. Production of vehicle electronics components will start in summer 2004.
Continental has increased its holding in Malaysian tyre manufacturer Sime Darby from the initial 30 per cent (an investment of 52.6 million US$) to 51 per cent. Sime Darby group’s two tyre companies will now be known as SDC Tyre Sdn Bhd. As well as a manufacturing base, the move gives Continental access to Sime Darby’s Malaysian dealer network of more than 1,000 outlets.
Ford and Mazda are to invest $500 million in their joint venture in Thailand; a country that Bill Ford says “will spearhead Ford’s Asian growth strategy”. The investment will increase annual production from 135,000 vehicles to 200,000, plus Ford plans to set up a regional headquarters in Thailand.
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