Raw Materials
(Tire Review – Akron, Ohio)
by Mary Aichlmayr
Robert H. Oudshoorn has been CEO of Vredestein Banden BV since 1994. Prior to that, he was director of commercial operations at a Michelin-Okamoto joint venture in Tokyo and also worked as representative director for Groupe Michelin in South Africa.
(Akron/Tire Review) A new report from Frost & Sullivan, entitled “Indian Tire Aftermarket,” shows that the Indian tyre aftermarket earned revenues of $1,461.7 million in 2005 and estimates revenues to reach $3,414.6 million in 2012.
Goodyear Tire & Rubber Co. chief financial officer Richard Kramer has announced that the company will continue to “attack high-cost factories” as part of its programme to lower its worldwide operating costs.
The Saudi-based Islamic Development Bank (IDB) is planning to offer loans of approximately £4 million to help the development of Iran’s tyre industry. On January 2 details of a statement from the bank’s Iranian representative, Tahmasb Mazaheri, were made public. Mr. Mazaheri was quotes as saying that the purpose of the loan was for the purchase of raw materials for tyre production within the Islamic Republic.
The IDB grants loans according to the principles of Islamic Law for the purpose of fostering economic and social progress within Muslim nations and communities.
Indian textiles company Gupta Synthetics seems set to be entering the tyre raw materials market after announcing plans to invest 2.23 billion rupees (£25.5 million) to set up a nylon tyre cord fabric (NTCF) making and nylon filament yarn (NFY) making factory in the city of Silvassa.
The facility will produce the cord fabric and yarn for the tyre, textile and furniture industries and will have an output capacity of 8,128 tonnes per year. The NFY side of the operations should be producing output by October 2007 while NTCF production fabric will commence in 2008.
Headquartered in Johnstown, Ohio and founded in 1939, Tech International is a family business that describes itself as the world’s leading producer of tyre and tube repairs and wheel service solutions. According to the official literature, the company markets more than 5,000 products into over 110 countries throughout the world and is recognized as one of the top exporters in the United States.
In response to the ongoing rising cost of raw materials Yokohama Tire Corp. has announced it will increase the price of its OTR tyres by between 3 and 5 per cent as of January 1.
29 managers have lost their jobs at Goodyear Dunlop UK. The job losses are part of a restructuring programme, which will cut around 100 jobs in total. The management cuts will almost exclusively be from positions at the company’s TyreFort headquarters in Birmingham, with about 69 job losses coming from non office-based staff. However, at least some of the jobs lost at Hi-Q and TruckForce depots are a question of administration, with employment simply transferring to the various holders of the new franchise agreement instead of Goodyear Dunlop itself.
Five international synthetic rubber producers received fines totalling 519 million euros (£350 million, $682 million) from the European Commission after the group said they had fixed prices. The penalty is said to be the second largest fine of its kind in history. Royal Dutch Shell PLC, Eni SpA, Dow Chemical Co., Unipetrol AS and Trade-Stomil were fined by the EC. Bayer AG was found guilty but was not fined because it blew the whistle on the others, according to the EC. The EC said the group fixed pricing and shared customer information on buyers of butadiene rubber and emulsion styrene butadiene rubber – used widely in tyre production – between 1996 and 2002. Italy’s Eni got the largest fine at £185 million ($357.6 million), and Shell was hit for £108 million ($211 million).
Financial analysts questioned whether the news would lead to a significant drop in synthetic rubber prices following the recent collapse of natural rubber. If so this could add to a “significant raw materials bonanza coming up in 2007 for tyre manufacturers,” according to Deustche Bank analysts.
If the share price of its parent company is anything to go by, speciality tyre specialist, Carlisle Tire & Wheel, is having a successful time of it in the growing niche segment. Between year-end 2005 and the close of trading on 31 October Carlisle Companies’ share price has increased 21 per cent from $69.15 to $83.69.
Carlisle used November’s SEMA show to highlight a number of new products within the ATV/Utility vehicle, ST Trailer and Industrial segments. And, further to this aim, the company’s new 2007 product catalogue is available now. The company also dedicated a section of its booth to its growing Carlisle Certified Dealer (CCD) network.
(India/Rubber Asia) After over 70 years of its existence and continuous development, China’s tyre industry is on firm ground. The Chinese tyre-making sector has now evolved into a huge, full-fledged industrial system that continues to attract international attention. However, there are obstacles to be overcome. After becoming a member of the World Trade Organisation (WTO), China’s tyre industry entered the era of diversified ownerships. And, the industry transformed itself into three types of ownerships – state-owned or state-controlled, private, and foreign-funded enterprises – from a wholly state-owned system. Thus, China’s tyre industry has entered a critical period and, in the process, is facing new challenges and responsibilities.
The European Commission has awarded Goodyear a major research and development grant for development of an ultra low rolling resistance tyre with environmentally friendly resources. The grant of three million euros is part of the European Union’s LIFE-Environment program. The total cost of the project is more than 12 million euros. Goodyear is working in close co-operation with two research partners on this project – the Italian research company Novamont and the German carmaker BMW.
Pirelli & C. SpA’s Pirelli Tire division achieved sales growth exceeding 10 per cent in the first nine months of 2006 and increased results from operations compared to the previous year. This performance was obtained despite the significant rise in raw material costs, which penalised the entire sector. Revenues were 2,990.6 million euros, up by 10.5 per cent compared to 2,706.9 million in the same period of 2005 (+7.3 per cent net of exchange rates).
(Akron/Tire Review) Yokohama Rubber Co. today reported that its most recent quarterly net sales increased 10.5 per cent over the same period last year, while its net income plummeted 74.8 per cent for the same period. Yokohama said it had quarterly sales of 222.4 billion yen, and that the sales increase was due to business growth in North America and Asia, including increased OE tyre business. Sales increased 11.5 per cent in Yokohama’s Tire Group to 162.5 billion yen. Operating income in the Tire Group declined 69.7 per cent, to 1.1 billion yen, reflecting the rising prices for natural rubber and other raw materials.
Continental will exceed the record sales and profit levels it achieved in 2005, according to executive board chairman Manfred Wennemer. At the interim results presentation, he stressed that the international automotive supplier had raised its adjusted EBIT by 10.1 per cent to 1.18 billion euros after nine months compared with the same period of 2005. “In our industry, it does not really make much sense to look at the quarterly figures. Nevertheless, the third quarter 2006 again shows that, with an adjusted EBIT of 410.3 million euros, we are nearly on par with the adjusted figures for the same period of 2005. In view of the costs for raw materials, which reached a temporary peak this quarter, and the production cutbacks of key customers in the US, we feel this is remarkable, since a year ago we achieved our best ever quarterly result.”
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