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Alcoa Acquires Samara and Belaya Kalitva Facilities from Rusal

Alcoa has announced that it has proceeded with its purchase of Rusal’s fabricating facilities in Samara and Belaya Kalitva in the Russian Federation. One of the two plants will be used for forged wheel production.The news following approval of the relevant Russian governmental organisation, the Federal Anti-Monopoly Service (FAS). This resulted in an FAS private ruling stipulating condition to ensure that Alcoa complies with its legal requirements and notification obligations. With the final government approvals in place, Alcoa and Rusal say they are taking the necessary steps to complete the transaction.

According to the companies, the terms of the transaction will be disclosed when the deal has been completed, which is expected at the end of January 2005. “The decision is an important step forward for both Alcoa and for Rusal,” said Alexander Bulygin, Rusal’s CEO. “For us, it means we can move ahead with our strategic focus on upstream and alloy production, and on expanding our raw materials access. We welcome Alcoa to Russia and anticipate continuing close relations in the future.”

The Samara facility is located about 500 miles southeast of Moscow. It features cast house, flat rolled products, extrusion, and forging capabilities and serves customers in a number of different markets, including transportation, packaging, and industrial products.

The Belaya Kalitva facility is located about 500 miles south of Moscow. The facility also features cast house, flat rolled products, extrusions, tubes, and forgings capabilities. The Belaya Kalitva facility has specialised plate rolling and finishing equipment that will complement and increase Alcoa’s present supply position. Alcoa claims that with its know how and management systems, the plant will not only be able to expand the product offerings for Russian customers but also will eventually be able to produce products for major customers in the west.

4th January 2005/by Tyrepress Editors

The Effects of Raw Material Price Increases

Minekazu Fujimura, CEO of Bridgestone Europe has warned that China’s production explosion is causing a severe shortage of steel cord, natural rubber and other raw materials, essential to tyre production.

Mr Fujimara told the Financial Times that the shortage has already driven up tyre manufacturers’ raw material costs by between 10 and 15 per cent, adding that further increases were inevitable. But it isn’t all bad. In the short term, Mr Fujimura conceded, the supply problems were proving to be financially beneficial. So far this year, the leading tyre producers have been able to raise their prices three times in acknowledgment of the rising cost problem.

As a result the big producers have reported improved results. Bridgestone itself has just reported operating income of $983m on sales of $12.6bn in the first three quarters. Goodyear this week reported a profit of $36.1m for the third quarter, its second successive quarterly profit after a long period of losses.

But Mr Fujimara is not resting on his laurels. “The problem is global and there is no escape from it. We have no choice but to pay the premium,” he said adding that the increases are likely to have a wider impact. “They will be working their way through into higher car prices,” said Mr Fujimura.

9th December 2004/by Tyrepress Editors

Mario Marangoni Inducted Into Hall of Fame

The TIA has inducted Mario Marangoni into the TIA Hall of Fame. At the beginning of November, during the SEMA show, the TIA made the award in order to recognise the company president’s “leadership and entrepreneurial ability.” As a company, Marangoni sees the award as an achievement that recognises the success of the Italian tyre industry in addition to its international business.

17th November 2004/by Tyrepress Editors

Yokohama’s Income Decreases

In its third quarter Yokohama Rubber saw net sales rise by 4.3 per cent to ¥189.7 billion. The company claims that this reflected “solid tyre sales overseas.” However, net income fell by a massive 51.6 per cent, to ¥719 million. The manufacturer claims that this was due to inventory losses and a loss on devaluation of securities investment.

Operating income also declined by 6.3 per cent to ¥4.3 billion, and has been put down to the increase in prices of natural rubber and other raw materials. Yokohama is also citing higher logistics costs stemming from increased export volume and a jump in shipping charges to the decline in income.

12th November 2004/by Tyrepress Editors

Bridgestone’s Financial Results

Bridgestone has released its unaudited consolidated business and financial results for the first three quarters of the present fiscal year ending 30 September. In its tyre segment it recorded operating income of $983 million on sales of $12.6 billion. The manufacturer claims “strong sales supported by surging demand, mainly in markets outside Japan, offset the effect of rising raw materials costs on profitability.”

8th November 2004/by Tyrepress Editors

Matador and ATC In Slovak-Ethiopian Joint Venture

July 2004 saw the completion of a joint venture between Slovakian tyre manufacturer Matador and the Addis Tyre Company (ATC) of Ethiopia. The initial discussions began in the year 2000 when Matador management visited Ethiopia to talk about mutual co-operation and technology transfer.

A basic agreement was signed in July 2002 between Matador, ATC and Addis Ababa and Public Enterprise Supervising Authority (PESA) to establish a joint venture with capital inputs for the production and sale of bias ply truck tyres, bias ply light truck and passenger car tyres, plus radial passenger car tyres.

Matador sees the joint venture as an opportunity to develop the Addis factory and at the same time to take advantage of reduced operating costs. The Puchov plant is scheduled to cease production of bias-ply tyres by the end of March next year, which will enable capacity to be increased in passenger and light truck radial and obviate the need for redundancies.

April this year saw the signing of the “Agreement on the Establishment of Matador-ATC Joint Venture for the Production of Tyres” at a ceremony at the Sheraton Hotel in Addis Ababa. Capital holdings in the JV are 61 per cent Matador and 39 per cent ATC. The agreement was signed by Mr Ing Stefan Rosina, president of Matador and Mr Ato Girma Biru, minister of industry and trade for the Ethiopian Federative Democratic Republic (EFDR).

The latest meeting was held in early July to launch production of the tyres and this time Matador was represented by Mr Ing Stefanom Rosinom, chairman of the board of directors of Matador and Doc. Stefan Prekop, general director. The Slovak delegation was received by the President of the EFDR, Mr Girma Wolde-Giorgisa.

President Mr Girma Wolde-Giorgisa said: “Ethiopia is the heart of the African continent and its development and prosperity depends on the increase of the technological level of industry, education, know-how and capital imports from foreign investors. I believe that the successful establishment and functioning of the Matador – ATC joint venture will become an example and a challenge for other foreign companies. I am glad that Matador has established its activities in our country” he concluded.

For Matador, Mr Ing Stefan Rosina said that the company “had found good partners in Ethiopia.” He added: “Conditions of business oriented towards the development of the domestic industry and market are good, but also conditions of export possibilities and the purchase of raw materials. I am convinced that the joint venture will achieve a good standing and importance like our joint venture in Omsk, Russia.”

3rd November 2004/by Tyrepress Editors

India’s Apollo Tyres’ Sales Jump

Indian tyre Manufacturer, Apollo Tyres is expecting sales to increase 18 per cent, a company official has said. Last year the company recorded sales of 23.14 billion rupees and this year expects to see sales rise to almost 27.3 billion rupees, nearly £327.8 million.

“We will maintain 18 per cent growth in sales. It would be more than double of the projected industry growth rate of 8 percent,” Neeraj Kanwar, chief operating officer at Apollo, told a news conference. At the same time Mr Kanwar warned that the profit margins of tyre companies are under pressure due to spiralling costs of raw materials.

2nd November 2004/by Tyrepress Editors

Bandag to Supply Volvo Fleets

Bandag has announced that Volvo has selected it as its pan-European tyre-retreading partner. Under the new agreement, Bandag will supply retreads to Volvo Trucks workshops.

28th October 2004/by Tyrepress Editors

Cooper Reports ‘Exciting Quarter’

Cooper Tire and Rubber has reported a 6 per cent year-on-year increase in its net sales, breaking its previous record for tyre operations.

22nd October 2004/by Tyrepress Editors

Dana Reports 33 per cent Drop in Income

Dana Corporation has released third-quarter results that show a 33 per cent drop in net income. The corporation received $40 million compared with $61 million in the same part of 2003. The company achieved third-quarter sales of $2.1 billion, compared to $1.9 billion the year before.

21st October 2004/by Tyrepress Editors

Delphi Shows Signs of Cash Flow

Automotive supplier, Delphi Corp has reported third quarter revenues of $6.65 billion and a net loss of $114 million (20 cents per share). When this is compared with net losses of $353 million (63 cents per share) last year, this figure shows signs that the company’s cash is flowing again.

19th October 2004/by Tyrepress Editors

Michelin Reiterates Limited Growth Expectations in H2

Michelin is fending off critics by reassuring all interested parties that its earnings and sales will improve this year, despite reiterating the fact that it expects higher raw-material prices to limit its growth in the second half.

“Raw-material prices are and will continue to rise and put pressure on margins,” Michelin’s CEO Edouard, told French newspaper Le Figaro.

30th September 2004/by Tyrepress Editors

Bridgestone to Use New BIRD Production System

Bridgestone Corporation has announced that it will introduce a ‘next-generation’ production system to the company’s Hikone Plant.

14th September 2004/by Tyrepress Editors

Steel and Rubber Price Increases Hit Industry

Rubber and Steel price increases are making a negative impact on businesses across Europe, according to analysts. In the last six months businesses have seen steel prices nearly double from $350 a ton in January to more than $617 a ton in June. This rapid growth is widely acknowledged to have been cause by high levels of demand for raw materials from the Chinese market.

7th July 2004/by Tyrepress Editors

Yokohama Business Results and New Management Organization

The Yokohama Rubber Co., Ltd., announced its consolidated results for fiscal 2004, ended March 31, 2004. Owing in part to favorable export sales, net sales increased 0.3%, to 401,718 million yen. However, operating income declined 9.1%, to 21,073 million yen, owing mainly to an increase in the volume of tire exports and higher prices for shipping and raw materials, such as natural rubber. Ordinary income decreased 8.2%, to 17,258 million yen. On the other hand, a tax reduction helped boost net income 1.8%, to 10,331 million yen.

19th May 2004/by Tyrepress Editors