Known for its style, speed and performance marketing values, Pirelli & C. S.p.A. is a multinational company based in Milan, Italy, listed on the Milan Stock Exchange since 1922, with a temporary privatization period by the consortium led by the Chinese state-owned enterprise ChemChina.
The Chief Executive Officer of Pirelli, Mario Tronchetti Provera, considers the PAX-agreement between the two tire giants positively. Pirelli is already a developing partner, together with Michelin, regarding PAX and Run Flat Technologies in general. Tronchetti said that Goodyear’s involvement will further accelerate the development and the promotion of PAX.
Cooper-Avon has announced that it will be making 80 staff employees redundant in Europe. Locations affected are the Melksham (UK) HQ and offices in Switzerland, France and Germany. The cuts are blamed on the high level of the Pound and large numbers of imported tyres from the Far East and have been made, says Cooper-Avon, to reduce costs and increase job security for the remaining 900+ employees.
Munich’s “Intermot” has become the main fair for motorbikes, the supplying industry and for dealers involved in motorbike tyres. Although the German market for motorcycles declined by 7 % (Europe: + 7 %) in the first half of this year, once again, “more than 150,000” visitors from 84 countries (1998: 150,368 from 80 countries) came to visit the New Munich Trade Fair Centre from 13 to 17 September to find out about the products and services of 1,033 exhibitors and 56 additionally represented companies from 35 countries (1998: 836 exhibitors from 33 countries). As in the premiere event in 1998, the proportion of trade visitors was approximately 35 %, with more than a fifth of their number coming from abroad. The largest contingents of trade visitors from abroad came from within the European Union (67 %) and the rest of Europe. Visitors’ interest encompassed all areas of the fair, with the top favourites being motorised vehicles (72 %), parts and accessories for motorised two-wheelers (47 %) and clothing and rider equipment. Therefore many companies from the tyre business were among the exhibitors in Munich: Cooper-Avon, Continental, Dunlop, Metzeler/Pirelli and Michelin showed their latest products and the tyre trade was present too. And there were a lot of new tyres to discover. For example a winter tyre for scooters, or Continental’s move into the radial segment, seven new tyres from Michelin and many more premieres for the upcoming motorbike season 2001. NEUE REIFENZEITUNG reviews all the news from the show in its October issue.
Six of the largest tyre manufacturers have announced their intention to develop a global e-business purchasing company. Rubbernetwork.com is an independent company which will host a global exchange, including Conti, Cooper, Goodyear, Michelin, Pirelli and Sumitomo Rubber. Confidentiality is assured and the exchange will be open to all manufacturers and suppliers. It will be operating by the year end. ‘Significant’ savings and efficiencies in purchasing are predicted.
Edouard Michelin, CEO of the French tyre giant, can see opportunities for technical alliances with competitors, a French magazine reports. As an example, he cites the new tyre and wheel system ‘Pax’, which will be presented jointly by Michelin and Pirelli in Geneva.
Tyre giants Michelin and Goodyear are to work together in the future on their run-flat systems PAX and EMT. A joint venture company has been formed, based in the Netherlands.
New Internet linked initiatives and on-line transfer of all Pirelli company processes were announced today by the company’s board of directors. The e-Pirelli project to has been assigned an investment of 2 billion lire for the period 2000-2002.
Popular German car magazine auto motor und sport tested ten M+S tyre brands size 195/65 R 15 on a BMW 323i. The test winners were Goodyear’s Ultra Grip 6 (“best tyre”) and Uniroyal’s MS Plus 55. These were followed by Dunlop’s SP Winter Sport M3, Continental’s WinterContact TS 790, Pirelli’s Winter 210 Snow Sport, Michelin’s Pilot Alpin, and Nokian’s Hakkapeliitta NRW. Those tyres which achieved only limited recommendation were Toyo’s Snowprox S 940 and Firestone’s FW 930, while last place in the test went to Yokohama’s Winter F 310 Plus.
Although a joint venture between Continental and Pirelli could make sense in the tyre sector, observers do not believe it. The Italians, in any case, deny it vehemently. While the German group is still recovering from the enormous effort of the Teves acquisition, the Italians are about to concentrate more on entering the real estate business. An extremely nervous reaction came from Pirelli Reifenwerke managers, who do not like such talk in the market, especially since they have enough to do looking after themselves. Sales boss Röske speaks in eloquent terms of the lustre of the Pirelli tyre brand that makes his team’s “eyes shine”. The brand, he says, is stronger than “our customers sometimes want to give us credit for”. In Röske’s opinion Continental may perhaps have tried to throw dust in people’s eyes to divert attention from a potential takeover by Bridgestone. This magazine rather thinks that Conti boss Kessel wants to avert the public gaze from talks with the telephone group Mannesmann, which is possibly ready to part with its automotive division.
Oskar Füthen (62), Managing Director of Pneumobil GmbH for almost 20 years, left the Pirelli distribution chain on 30th September 1999. Ralf Brockmann was appointed as the new Managing Director. And what is more, The distribution chain will no longer report to Pirelli Reifenwerke but to the Milan head office, which has taken over responsibility as per 1st October 1999, particularly for the strategic line in connection with the negotiation of terms and conditions.
Pirelli has released first details of a new manufacturing system, called MIRS (Modular Integrated Robotised System). The company is investing 250 million Euros over the next five years. A MIRS plant that can produce one million tyres a year would employ 104 people in five shifts, would occupy 3,500 sq. m. and the investment cost (excluding the building itself) would be around 45 million Euros. According to Pirelli, MIRS reduces the steps of the tyre building process from the previous 14 to only three. Instead of passing the tyres “from hand to hand” in the production process, the MIRS work is done by robots. Tyre type and size are fed into the computer at the beginning of production, the rest is done by the computer alone, without human interference. MIRS is therefore a kind of mini-factory with an extremely high degree of flexibility. The factory can be built anywhere where there is a market. The technology, which Pirelli does not disclose and is not prepared to share with a competitor, not even under licence, was developed by Pirelli’s research and development department in co-operation with Italian universities and the Ministry of Research and Science. A pilot plant will start work in the Bicocca factory near Milan at the end of June 2000. The Italiens claim a manufacturing cost reduction of 25 p.c. for the MIRS method compared with the traditional way, and Pirelli boss Tronchetti Provera plans to manufacture three million tyres by the new method by the year 2003, or 15 p.c. of its high and ultra-high performance tyres. If all goes to plan, it will be possible to produce five million “MIRS tyres” within five years.
From 9th to 13th November 1999 all eyes of Europe’s agricultural industry were again on Hanover, where the eighth (since 1985) international DLG trade fair for agricultural technology, “Agritechnica ‘99” was held on the site of the future Expo, the third time in succession at this venue. The German Agricultural Society (DLG) as organisers reported an impressive number of bookings: 1,500 companies in total (531 of them from abroad) presented a complete agricultural programme at the Hanover exhibition centre, an increase in exhibitor numbers of nearly 14 p.c. over 1997, the date of the last such fair. The total exhibition area was also extended by almost 20 p.c. since 1997, to 190,000 square metres. Agritechnica also reported the strong presence of the tyre industry, led of course by the “Big Three” in the tractor field, Michelin, Kléber and Pirelli (the latter now under its new name “Trelleborg Wheel Systems”), which in the last few years almost carved up the lucrative original equipment business in tractor drive-wheel tyres between them. Now other suppliers, Continental, Goodyear, Firestone and Taurus try to muscle in on the OE business. With the sole exception of Firestone they were all present at Agritechnica, as were Vredestein, Alliance, Danubiana (Tofan Grup) and Titan.
Not many years ago the large tyre manufacturers still thought they had better make haste and claim a stake in the apparently huge markets of China and India, since life does not favour latecomers. Their enthusiasm was kindled by the example of some car manufacturers, which quickly calculated and estimated a gigantic (sales) potential in these two countries alone with their joint populations of two billion. Some car manufacturers learnt quickly that opportunities are not limitless. Tyre manufacturers fared similarly. Pirelli supplied China with some know-how, which was gratefully received but did not provide Pirelli with a strong base. Nor did the Italians make money out of the technology transfer. Conti’s big plans for India are hardly mentioned any more. The “Big Three” – Goodyear, Bridgestone and Michelin – are present in both countries, but business is quiet. In India, 29 manufacturers run 41 factories with a maximum capacity of about 43 million tyres, but only 34 million pieces were manufactured in 1997/98, most of them (73 p.c.) for trucks and buses. And 60 p.c. of passenger car tyres are still cross-ply tyres, 1998 has only seen 3,3 million radials in this segment. Our British sister magazine TYRES &ACCESSORIES reported on the Indian tyre market at length; we publish an excerpt in this issue in our December issue, including a brief presentation of some individual companies active in this market.
Pirelli has published its figures for the first nine months of 1999. Turnover is up 15%. The Cables and Systems sector turnover was 2,805 million Euros (first nine months of 1998 2,036 million) while the Tyre Sector turnover was 1,917 million Euros (2,068 million). Gross operating profit was 489 million Euros (492 million) and consolidated operating profit was 231 million Euros (264 million).
American photographer Annie Leibovitz was inspired by classic Rubens and Botticelli pictures when creating the Pirelli Calendar 2000, which was recently presented in London. Leibowitz was also involved in Pirelli’s 1994 advertising compaign showing Carl Lewis in red high heels.
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