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Tyremakers Back to Work in South Africa

A decision that resounded as music to the ears of South Africa’s tyre industry was announced on August 17 – the month long strike that brought production at factories belonging several tyre majors to a halt has been resolved. Following a breakthrough in negotiations workers at Bridgestone, Continental, Dunlop, Firestone and Goodyear agreed to return to work on August 21.

The National Union of Metalworkers of South Africa (Numsa) urged all its members to meet at their workplace on August 20 for a report about the wage talks. “Numsa is of the view that it has made progress. It will discuss with its constituencies on Monday whether the current offer on the table does constitute a settlement,” said Numsa regional secretary Irvin Jim. The offer includes an eight per cent across-the-board increase, 8.5 per cent for minimum salary employees, and 7.5 per cent for next year and the year after.

20th August 2007/by Tyrepress Editors

Bridgestone Begins Run-Flat Production in South Africa

Bridgestone’s wholly owned South African subsidiary Bridgestone South Africa has become the country’s first tyremaker to begin the commercial production of run-flat tyres. The tyres will be manufactured at the company’s Brits plant in South Africa’s North West Province, a facility that has received a R700 million (£48 million) expansion and upgrade over the previous five years.

The first OE deal for the new South African run-flats was officially approved by carmaker BMW in June. At this stage, however, Bridgestone South Africa chairman and CEO Yasuhiro Ito reports that BMW is the only manufacturer fitting run-flats to locally assembled cars, and Bridgestone is not involved in talks with any other OEM.

20th August 2007/by Tyrepress Editors

Halfway Around the World with Cooper Tire

The ruggedness of Cooper Tire 4×4 tyres is being put to the test with an ambitious 40,000km trek from Cape Town in South Africa to London. Cooper’s products have been selected as the tyre of choice for the “Africa Overland” expedition, a journey being made by Australian couple Ron and Viv Moon. This is their eighth trip through the Continent in 20 years, and by mid-August the couple was already halfway through the mammoth 30-week adventure; Ron and Vic expect to arrive in London in mid-October.

With South Africa, Namibia, Zambia, Malawi, Mozambique, Tanzania, the Serengeti and Kenya already visited, the Cooper Discoverer STT-shod, 4.2-litre Nissan Patrol will pass through a total of 16 countries in all. “The tyres have performed fantastically well,” said Ron Moon. “We’ve clocked up some 33,000km and put them through some of the toughest roads in Africa, varying from near non-existent tracks, to sandy Kalahari Desert roads and deep mud hole-dotted trails. They’ve been amazingly good for the areas we’ve been driving in, and the loads we’ve been carrying – our vehicle weighs around four tonnes.”

17th August 2007/by Tyrepress Editors

Dunlop SA Introduces Hi Tech Sales Tool

Today people expect more than a basic over the counter ‘buy and sell’ retail experience. In our technology-driven world, where a cell phone doubles as a video camera, home computer and music player, where we can pause and replay television programmes at the push of a button, there is no such thing as a passive consumer anymore. Instead people demand to be entertained, involved and informed every step of the way. No wonder interactivity has become the latest buzzword in the modern sales environment internationally.

In South Africa, Dunlop Tyres has responded to this new phenomenon by initiating a new dimension to the customer experience. At Dunlop dealers countrywide, they have developed and launched a state-of-the-art Dunlop Interactive Display Module. It is claimed to be the first of its kind in the region’s tyre business.
Jenny Soons, advertising manager at Dunlop elaborates. “Enhanced interaction with the consumer is a global retail trend, providing product information in an entertaining way, and this is what the Dunlop Interactive Display Module does – it adds interest and provides consumers with an enjoyable interactive experience.”

17th August 2007/by Tyrepress Editors

South African Tyre Manufacturing Strike Continues

South Africa’s tyre manufacturing sector strike has failed to reach a settlement despite previous high hopes. Workers have already accepted the proposed wage increase offer but have not been able to reach an agreement with employers on issues related to contract work and employees’ benefits.

The National Union of Metalworkers of South Africa (Numsa) and the Employers Association have met to find a resolution to the strike, however Numsa provincial secretary Irvin Jim reports that a new complication has arisen. “At the eleventh hour, employers approached negotiations with a new demand. They want to secure a three-year agreement. We were forced as a union to place on the table what we demand on wages for the next two years, which is 8 per cent for the next year and 8.5 per cent for the third year.

“Under these circumstances we think it is time that we remain very strong and solid. The strike must continue because we can’t sell-out for the second and third year.”

16th August 2007/by Tyrepress Editors

Hopes High for End to South African Strike

Tyre manufacturers and unions in South Africa are hopeful that the three-week old industry strike may be coming to an end. The National Union of Metalworkers of SA (Numsa) said it hoped a final settlement may be reached on August 14.

“One outstanding issue was that Goodyear tyre should come out with a plan on how they intend to phase out labour brokers in their employment,” said union spokesperson Maziwakhe Hlangani. Goodyear has agreed that 100 of the 250 contract workers will be absorbed into permanent staff compliment.

“Other issues involved are labour costs, which include shift allowances, and increases in provident funds contributions, which should be tackled again, said Hlangani.

According to Numsa, the Employers’ New Tyre Industry Association was offering wage increases ranging from 8.5 per cent for the lowest paid workers, 8 per cent across-the-board and 7.5 per cent for those earning above the maximum grade levels

14th August 2007/by Tyrepress Editors

Second-Hand Tyres Costing More Than New as OTR Shortage Bites

(Akron/Tire Review – Mining Weekly South Africa) Second-hand tyres for large off-road trucks were costing more than new ones because of the biting tyre shortage, Kumba Iron Ore CEO Ras Myburgh told Mining Weekly Online on Tuesday. Myburgh said that the shortage of tyres was at one stage so acute that trucks were grounded for months.

Second-hand tyres were selling in the region of R250,000 each and trucks costing as much as $5-million dollars were being delivered without tyres because of the acute shortage. He said that the JSE-listed Kumba bought tyres separately. “Currently you can get trucks, but you can’t get tyres,” he said. “If you don’t have a long-term supply agreement, you can end up buying brand-new tyres that last only a fraction of what you get from normal suppliers.

8th August 2007/by Tyrepress Editors

Qizhou Rubber Aims to Build Biggest OTR Tyre in the World

Already a producer of giant OTR tyres such as 45/65-45 L5, 37.25-35E3, 4000-57E4, 50/80-57, 52/80-57, 58/85-57, 70/70-57, Qingdao Qizhou Rubber is planning to make “the biggest tyre in the world – 59/90R63,” which is expected to be available by the end of 2007. And furthermore the company claims it is going to do this using ”environmentally friendly” polyurethane technology. Qingdao Qizhou’s announcement comes a year after the company signed a $400,000 licensing agreement with polyurethane tyre developer Amerityre Corporation.

Qingdao Qizhou Rubber Co., Ltd. is a privately owned manufacturer, located in Qingdao, China with a projected turnover of approximately US$100 million for 2007. Qizhou Rubber Co., Ltd. has about 860 employees and manufactures industrial, agricultural, truck, bus, and OTR tyres for export to over 30 countries under the Marcher brand name. Its products are used in the worlds’ various mining sites, both open pit and underground, at temperatures ranging from -66’C, to +50’C. Its sand tyres are known to have been used in desert land where the surface temperature has reached up to +80’C.

2nd August 2007/by Tyrepress Editors

Striking South African Workers Vent Anger at Tyre Plant Bosses

Striking workers at Continental Tyre South Africa’s Port Elizabeth factory have expressed their feelings towards deadlocked wage negotiations with what one local media source has described as a “rampage.” The Port Elizabeth Herald described the July 31 events as nearly becoming “out of control,” with “verbal abuse exchanged between the group and police.” Part of the road outside the plant was reportedly barricaded with burning tyres and a number of motor vehicles belonging to employees not participating in the strike were damaged.

Members of the National Union of Metalworkers of South Africa (Numsa) were well represented amongst the demonstrative group outside the plant, and Continental is accusing them of not adhering to the accepted rules of picketing. “The company can‘t condone an act of this nature. Under the circumstances we will be forced to enforce the picketing order,” Continental Tyre spokesman Attie Higgs told media. In its defence Numsa said the display of anger was symbolic of the workers’ growing frustration and desperation, and the union accused the plant bosses of “not negotiating in good faith.”

1st August 2007/by Tyrepress Editors

An “Exciting Year”

The 34th Apollo Tyres Annual General Meeting, held in the Indian state of Kerala on July 26, was more than merely an occasion on which to report the company’s latest financial results. For chairman Onkar S Kanwar it was an opportunity to take stock of where the company has been and where it is headed. These thoughts were reflected in his address to company shareholders.

“The India we live in has changed dramatically over the last 34 years, he said in opening. “And especially so in the last ten. Today we stand at the threshold of great opportunity as a nation, for tomorrow will be India’s century.” He added that if India takes on the attitude of “being a winner”, as he believes Apollo has, the nation will continue to grow and “claim our rightful place in the pantheon of leading nations of the world.”

26th July 2007/by Tyrepress Editors

Apollo Reports Strong Q1 Financials

On July 25 the board of directors at Apollo Tyres reported the company’s unaudited results for the first quarter of the 2007-08 financial year, and also named August 27 as the date in which Rs 10 equity shares will be split into ten equity shares valued at Rs 1 each.

First quarter (April to June) net sales closed at Rs 11.5 billion (£138.6 million), an increase of 22 per cent on the previous year’s Rs 9.4 billion (£113.3 million). Net profit was recorded as Rs 546.4 million (£6.6 million), an impressive 369 per cent jump on the Rs 116.5 million (£1.4 million) obtained during the first quarter of 2006-07. Apollo attributes this significant profit growth to stabilising prices in major raw materials such as natural rubber, crude and steel, plus an improvement in key operating efficiencies, including wage cost, interest and depreciation.

The tyremaker further reported that all major product categories experienced substantial growth both in India and South Africa. The highest growth areas were 35 per cent for truck and bus radials in South Africa and 23 per cent for car radials in India.

26th July 2007/by Tyrepress Editors

Large TiWheel Share Trade Under Scrutiny

South Africa’s JSE stock exchange confirmed on July 24 that it was looking into an unusually large trade of Tiger Wheel and Tyre stock in May, and would make a report on the matter to the nation’s Financial Services Board. While it is not yet clear to the JSE whether or not the trade should be considered suspicious, the trading of more than 7 million shares in a single transaction on May 11 – only two weeks before Tiger wheels issued a cautionary announcement – is an event that contrasts markedly with the preceding low trading activity in Tiger Wheels shares.

The cautionary, published on May 30, said the performance of its 74 per cent held global wheel manufacturing business, ATS GmbH, had failed to meet the expectations of the revised performance forecast made to its German financing syndicate in February. However, the JSE reportedly had no knowledge of the May 11 transaction until Business Day, one of South Africa’s leading financial newspapers, brought it to the stock exchange’s attention.

The trading activity in question involved about ten per cent of the company’s 59.6 million shares. It is not clear at this stage whether insider trading is suspected.

25th July 2007/by Tyrepress Editors

Strikes & Wage Negotiations Continue in South Africa

South Africa’s tyre industry strike continued into its third day on Tuesday July 24 while wage negotiations reportedly continued to advance at a snail’s pace. While Tyre Employers’ Association spokesperson Attie Higgs reported that the parties involved had made progress on several non-wage demands, negotiations on wage related issues had not budged, with the “same position” being maintained on both sides.

While unions are demanding a 10 per cent wage rise, tyremakers Dunlop, Continental and Goodyear are prepared to offer an increase of 7.5 per cent, while Bridgestone’s carrot is a 7 per cent wage rise. National Union of Metalworkers South Africa spokesperson Mziwakhe Hlangani said “we want to force employers to improve their offer because the industry has been reporting good profits over the past three years. We are hopeful of a significant wage increase.” Such claims of industry growth are refuted by Higgs, who countered with the argument that during the past three to four years the local industry’s market share had been diminished by the presence of imported tyres.

25th July 2007/by Tyrepress Editors

Tiger Automotive Not Affected by TiWheel Complications

Wheel and tyre wholesaler/retailer Tiger Automotive, who operates in both the UK and South African markets, is reportedly not vulnerable to any possible claims made by creditors of Tiger Wheel. According to company CEO Keith Rivers, “When Tiger Automotive was unbundled from Tiger Wheel Limited in December last year, the separation was complete. As far as I am aware there were no cross guarantees.”

TiWheel shares were suspended from trading on July 11, and the company’s recent financial results have been disappointing. However Rivers states that Tiger Automotive is in good shape and looking forward to a slight increase in year-on-year earnings to end June. He added that two ‘constraints’ to Tiger Automotive had been resolved – the 16.5 per cent anti-dumping duty on Chinese tyres has been removed, and problems regarding deliveries to Yokohama South Africa from Japan have been almost totally overcome.

13th July 2007/by Tyrepress Editors

Trading of Tiwheel Shares Suspended

The board of directors at Tiger Wheels Limited has issued advice stating it requested the South African stock exchange JSE Ltd suspend trading Tiwheel shares until further announcement. This suspension took effect as of July 11.

“Shareholders are referred to the cautionary announcement published on May 30, 2007, and are advised that the board of directors of Tiwheel has requested the JSE Limited to suspend trade in Tiwheel’s shares until a further announcement can be made,” the company said in a statement.

Shares in the company have fallen more than 40 per cent since the end of May this year, and on May 30 the company gave notice that the performance of its 74 per cent held global wheel manufacturing business, ATS GmbH, had failed to meet the expectations of the revised performance forecast made to its German financing syndicate in February. It further stated that the syndicate regarded this as a further breach of bank covenants.

12th July 2007/by Tyrepress Editors