Raw Materials
As of June 24, 2011, the Association of Natural Rubber Producing Countries has clarified that it expects a 4.9 per cent rise in the total supply of natural rubber for 2011. The Association estimated that 9.936 million tonnes will be produced this year. It issued a statement to rebuff reports that the ANRPC has quoted different figures.
Bridgestone Australia has announced a price rise of all its products in the country by an average of five per cent from 1 August. Explaining the price hike, group chairman and managing director Nobuyuki Mieno said: “The current costs of raw materials such as natural rubber, oil derived materials and others are maintaining their recent historic high levels.”
On June 15, Michelin presented awards to four of its suppliers in recognition of their exceptional contribution in 2010. Held in the tyre maker’s home town of Clermont-Ferrand, the ceremony followed a rigorous assessment of the Michelin Group’s portfolio of suppliers.
Yokohama Tire Corporation has announced a price increase of an average of 8 per cent on all of its light and medium commercial truck tyres sold in the USA from 1 July. Rick Phillips, Yokohama director of commercial sales, said that in addition to rising raw materials costs “other factors also influenced the increase, such as the costs associated with manufacturing and transportation, which continue to escalate.”
US chemicals company Solutia Inc. reports having reshaped its rubber chemicals portfolio. Although specific details about this change have not been publicised, the company says the reshaping shows a reaffirmation of its “commitment to high-value, market-leading rubber chemicals,” including its Santoflex antigradants, which are used in the production of tyres, belts, hoses, cables and other products.
A further round of price increases will be implemented by Bridgestone Europe during the third quarter of 2011. The tyre maker states that, starting July 1, prices for truck and bus radials will rise by an average of 12 per cent, agricultural, off-road tyres and retreads by an average of eight per cent, while an increase averaging five per cent is planned for passenger car, 4×4, light commercial vehicle and motorcycle tyres.
As well as manufacturers of electric vehicles and related equipment, suppliers of the kind of raw materials and chemical components that make low rolling resistance tyres possible were also in attendance at last month’s Challenge Bibendum. The most prominent suppliers in this category were Rhodia and Lanxess. But with many premium tyres and a growing number of lower cost products already utilising silica-based technology for example, how low can tyres continue to go in terms of rolling resistance?
Following a feasibility study evaluating potential locations throughout Asia, Lanxess has announced plans to erect a second synthetic rubber facility on Singapore’s Juron Island. A memorandum of understanding on the new plant is scheduled to be signed by the German company’s CEO Axel C. Heitmann and Singapore Economic Development Board chairman Leo Yip on June 2; the signing ceremony has been scheduled to coincide with German Chancellor Angela Merkel’s first-ever visit to Singapore.
Indian media sources report that the All India Motor Transport Congress (AIMTC), an organisation said to represent around seven million trucks, has announced plans to cut supplies of raw materials to Apollo Tyres’ factories in Tamil Nadu, Kerala and Gujarat. On top of this, the AIMTC apparently intends to block the supply of Apollo products to the market. The reason for this action is said to be discontent with the price increases Apollo has implemented in recent times, and other tyre makers are also under threat of boycott.
Concurrent with the release of its revised Environmental Mission Statement, Bridgestone Corporation has announced its approach towards resource conservation, declaring its commitment to ongoing improvement as a steward of natural resources and to continue refining its processes, products and services to reduce, reuse or recycle raw materials, water and energy. Key activities the company is undertaking to achieve these aims include a reduction in CO2 emissions throughout all its products’ lifecycles and “doing more with less” in regards to raw material usage.
Governments have G8 summits, economists have the World Economic Forum in Davos – for those with an interest in mobility development there's Challenge Bibendum. The 11th Michelin-sponsored forum has grown from an opportunity to present wonderfully creative ideas to the point that the technology on-show at this year's event (held in Berlin for the second time, from 18 – 22 May) are closer than ever to the production technology of tomorrow. True, some of the wackier concepts like free-mind and thought assisted driving that could be seen may still be some way off, and there were a number of prototypes that are more illustration that innovation, but the majority of technology demonstrated at Michelin's window on the roads of future is either 2 – 3 or 5 – 7 years from actually hitting the market.
Despite supposed crackdowns by Chinese authorities, the theft of patents, intellectual property and trade secrets remains a big business in China. And while the tyre industry has not been immune – Michelin among others have pursued legal action against Chinese tyre makers and tyre importers – vastly improved technology and knowledge among Chinese engineers and producers has made it much harder to prove some types of alleged theft.
Germany’s newly elected minister of economic affairs Prof. Dr. Birgitta Wolff joined other dignitaries and employees from Styron to celebrate the construction of Styron’s new SSBR (Solution Styrene Butadiene Rubber) production line on 11 May 2011. The groundbreaking ceremony marks the introduction of an additional 50,000 metric tons of production capacity at the firm’s facility in Schkopau, Germany. According to the company, this will allow Styron better supply the “increasing demand for high performance tyres.”
Diminished profits are the order of the day in Ceat Ltd’s audited financial results for the financial year ended March 31, 2011. Performance in the final quarter impacted on the Indian manufacturer’s performance, and despite annual income growing 24.2 per cent to Rs 35163.3 million (£477.3 million), annual net profit plummeted from Rs 1610.3 million at the end of 2010 to Rs 222.8 million (£3.0 million).
Financial analysts have raised their share price target for Hankook stock following the publication of the Korean-based manufacturer’s first quarter results. Writing in an investor’s note published on 21 April, Morgan Stanley analysts wrote: “We are raising our price target for Hankook Tire to 38,000 won and maintaining our equal-weight rating.” The analysts wrote that their change in price target is “predominately driven by our revised earnings forecasts, as well as adjusted share count.”
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