Retreading
North American based member supported industry association the Tire Retread & Repair Information Bureau (TRIB) reports that approximately 18.6 million retreaded tyres were sold in North America during 2006, with sales exceeding US$3 billion. The majority of these were medium truck tyres. TRIB further reports that currently there are approximately 900 independent and manufacturer linked retreading plants operating in North America.
Bridgestone has declared its intention to “establish the status of being the undisputed world number one tyre and rubber company both in name and reality” by means of a new five-year plan unveiled on October 22. This mid-term management plan has been formulated through planning on the part of each of Bridgestone’s strategic business units to maximise use of all global business resources available to them, with these efforts supported by the company’s global management platform.
The intended result of this mid-term plan is an increase in net sales of almost 20 per cent (over its 2007 sales forecast) to 4 trillion yen (£17 billion) by 2012. These funds will be channelled into a number of areas, and to facilitate this Bridgestone will implement a number of key strategies based upon what it calls its “four fundamental management policies.” These strategies include reinforcing and adding value to product areas in which the company has “preceded its competitors”, including run-flat tyres, PCR UHP and winter tyres, as well as Greatec and low profile tyres for trucks and buses. The company also intends to “secure overwhelming competency to ensure long-term superiority” in the area of large OTR radial plus aircraft and motorcycle tyres. Furthermore, Bridgestone reports that “full use” will be made of Bridgestone Bandag, with package solutions being made available to customers in the truck and bus tyre business. This move will potentially see Bridgestone competing on a level in the retreading business previously solely enjoyed by arch rival Michelin, who to date has been the only new tyre manufacturer to market its retreaded products as a tyre option on par with its new tyre range.
(Akron/Tire Review) Brampton, Ontario’s Tiremaster Ltd. has switched from the Bandag retreading process to Michelin Retreading Technologies’ process. “As we look toward the future, we’re confident that Michelin’s technology, quality and cradle-to-grave approach is the best solution for our customers – particularly the large national fleets,” said Tiremaster President Ron Cherry. “After decades in the retreading business, I’m sold on the MRT process supported by Michelin service.”
Birmingham-based Dunlop Aircraft Tyres has signed a Memorandum of Understanding with Hong Kong Aircraft Engineering Company Limited (HAECO) and Taikoo (Xiamen) Aircraft Engineering Company Limited (TAECO) to establish a tyre retreading facility in Jinjiang, Fujian Province, China. It is intended that a joint venture will be formed with Dunlop Aircraft Tyres as the majority partner and the new facility to be operational in early 2009.
The new follows AAC Capital Partners’ (formerly the private equity business of ABN Amro) acquisition of 74.6 per cent of Dunlop Aircraft Tyres in May this year. The most recent announcement shows that predictions that the expansion in China would come to fruition 12 – 18 months after the sale are right on track. However, at the time of the sale of 74.6 per cent of Dunlop Aircraft Tyres in May, there were also suggestions of expansion in the US. No mention of the progress of these plans has yet been made.
Michelin North America announced on October 5 the completion of its acquisition of the Oliver Rubber Company from Cooper Tire & Rubber. Oliver, which produces tread rubber and retreading equipment, will now operate as a subsidiary of Michelin North America, Inc.
The US Federal Trade Commission granted an early termination of the standard waiting period for the transaction allowing the acquisition, which included a cash purchase price of US$69 million, to proceed.
This latest acquisition complements Michelin’s tread manufacturing capacity and extends, via the Oliver dealer network, the commercial reach of Michelin’s services throughout North America’s growing retreading market. In 2005 Michelin announced a major expansion of its tread manufacturing facility in Covington, Georgia and, earlier this year, the opening of a new tread manufacturing facility in Querétaro, Mexico.
European retreading material suppliers have been dominating the retreader supply market for years. But now they face new competition from supplies originating from outside Europe. These competitors are addressing some of the same customers and are increasingly doing so on the same basis – quality and price. The latest edition of our bilingual Retreading Special supplement (produced by Tyres & Accessories in cooperation with our European sister publication Neue ReifenZeitung) put the editorial focus on the increasing polarization of the market between the established suppliers on the one hand and the manufacturers and second row on the other.
The next edition of this increasingly popular supplement will be published in parallel with our March 2008 issue. The current issue is available to download free of charge here and is stored, along with other back issues, in the archive section of www.tyrepress.com, under reports.
The Republic of Belarus has experienced robust economic growth in recent years, with the latest figures showing a growth in GDP of nearly seven per cent. The economy is highly industrialised, with exports playing a crucial part in the growth in prosperity. One of the largest enterprises in Belarus – indeed, one of the largest in Europe – is the Belshina Open Joint-Stock Company. The tyre manufacturer operates three factories, covering an area of 173.6 hectares and employs around 12,000 staff, producing more than 200 sizes and types of tyre, from passenger car up to giant tyres for mining and construction machinery.
Belshina sells tyres on both the replacement and OE markets, having a number of OE contracts with local and foreign vehicle manufacturers across all sectors. (Valtra, Brazil – tractor manufacturer; Terex Equipment Ltd., Scotland – mining and construction machinery manufacturer; Belaz, Belarus – mining machinery; MAZ, Belarus – trucks, KAMAZ, Russia – trucks; MTZ, Belarus – tractors).
(Akron/Tire Review) Members have spoken, and TIA has 13 newly elected board of directors members. The new board members will officially take office Oct. 29 at TIA’s annual membership meeting in Las Vegas, just prior to the SEMA Sow.
Thirteen seats were open including 10 seats with three-year terms, one seat with a two-year term and two seats with a one-year term. Elected to serve three-year terms were:
Advanced ID Corporation has signed an exclusive, three year commitment contract with Malaysia’s Kit Loong Tyre Management for Advanced ID’s RFID and Pneu-Logic’s Tire Inspection products.
Kit Loong Holdings, one of Southeast Asia’s largest retreaders and tyre distributors works with Goodyear, Dunlop, Michelin, Bridgestone, BF Goodrich, Pirelli, Continental Sime and Cooper. With over 500 employees and revenues exceeding US $40 million, Kit Loong has retreading facilities in Malaysia and China and will install Advanced ID’s RFID tyre tags in their retread operation in Malaysia, with other countries to follow. Kit Loong will purchase Advanced ID RFID readers and Pneu-Logic kits as part of this agreement.
Kit Loong’s territory, covered by this agreement, includes Greater China, Malaysia, Singapore, Brunei, Thailand, Indonesia, Philippines, Vietnam, Cambodia, Laos and Myammar.
McConechy’s Tyre Services, Scotland’s biggest independent in truck tyre supply and repairs, has recorded a 53 per cent rise in profits. The results come just under a year after the company announced that its surplus had fallen by around 50 per cent. In its latest set of financial accounts, McConechy’s reports pre-tax profits of £975,942, compared with £636,368 the year before. However, this figure was a much as £1.2 million in 2005, a height that the company said was hit by one-off restructuring costs including the closure of its Paisley retreading plant. The 2006 accounts show that turnover is up 7 per cent to £33.8 million.
The report added that directors plan to invest £1.4m this year as part of its ongoing programme of refurbishments, relocations and acquisitions.
For smaller companies involved in the tyre business it is sometimes equally important to stick to good old traditions as it is to find a way to develop the business creatively. A company that has obviously succeeded in both over the years is the retreader and tyre dealer “Reifen Wondraschek” from the Austrian city of Linz. While in the past the company was mainly known for its activities in the retreading business, today the company engages in an increasing range of new activities, such as exclusive distribution of the Cooper brand in Austria or – as of this year – the exclusive rights to market the Nexen brand in Austria. And just as Reifen Wondraschek is embarking on new businesses, old ones are being phased out. At the end of last year the company ceased producing retreaded tyres for passenger cars. This step was necessary, although painful at the same time as passenger car tyre retreading was once the core business of Reifen Wondraschek, which was founded in the 1930s as a vulcanising company.
(Akron/Tire Review) Michelin North American introduced the XDA5 drive position radial, which it said has a tread design that will “regenerate” itself during use, and will “outlast the drive tyre it replaces by at least 30 per cent.”
Michelin said the tread pattern of the XDA5 is molded in three dimensions, and as the tyre wears, the tread reveals new grooves and tread blocks.
“This regenerating tread design keeps the tyre in service longer before retreading, an impressive 30 per cent improvement in tread life over other drive tyres that are commercially available,” the company said. “That translates into improved safety and lower costs for fleets and owner operators across North America.”
The tyre’s “double-wave matrix” sipes give the tyre’s 30/32-inch tread blocks the ability to lock together in all directions, Michelin said, for rigidity, resistance to scrub and minimised irregular wear.
For a company like Borrachas Vipal S/A the European market is becoming more and more interesting. On the domestic Brazilian market, a market with a size of about 8.5 million retreads per year (90 per cent pre-cured treads), Vipal is a clear market leader with a 45 per cent share, and the company is well established, with 25 successful years already under its belt. In Europe, on the other hand, Vipal started business with its newly found subsidiary only two years ago. However, according to international business director Maria Locatelli, this is one of Vipal’s major advantages, as the market thus offers the retreading and tyre repair material supplier an immense scope for developing its business. Based upon this conviction Vipal appears to be strongly self-confident. Nevertheless, there is no need to hurry, Mrs Locatelli asserts; it is better to approach the European market thoroughly rather than rapidly: “We must first understand the market,” says the director, summing up Vipal’s European strategy for the time being.
Together with its parent company in France, Laurent Reifen GmbH from Germany is Europe’s largest retreader. For more than 50 years the long established company has played a major role in Europe as an industrial retreader. The factory in Oranienburg in the German state of Brandenburg (close to Berlin) has an annual production capacity of more than 200,000 units of retreaded truck and trailer tyres. Furthermore, in Germany as well as in Avallon, France, more than 2,500 pre-cured treads are produced every day. With about 120 different treads in all the major sizes available the company can supply new treads for almost every commercial tyre application. And the German company and its French parent are not only represented in these two countries; Laurent, as a member of the French Michelin group, is also represented in Belgium, Denmark, Luxembourg, the Netherlands, Austria and Switzerland.
In the course of the past years there has been but one important process that has dominated developments in the European pre-cured retreading market: suppliers from outside of Europe are finding it more and more feasible to claim a growing market share to themselves. According to figures made available to Tyres & Accessories, the share of pre-cured treads that have not been produced by Bandag, Marangoni/Ellerbrock, Kraiburg or Michelin was at 18 per cent in the year 2000. Five years later, in 2005, the “others” (see pie chart) had already gained 29 per cent of the European pre-cured retreading market. And there are market observers that predict within three to five years this group of companies will potentially supply up to 50 per cent of all pre-cured tread used in European retreading facilities. One of these observers is Joe Krimpenfort, who – as general manager of the material supplier Galgo Pre-Q Europe – sees his share of the European retreading market as being there for the taking.
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