Across the Atlantic they are called tires, while over here we use a “Y” and say tyres. This tag provides the latest tyre business news emanating from the United States of America (USA), whichever way you spell it.
At the SEMA show, Bridgestone/Firestone North American Tire (BFNT) unveiled a new project vehicle, the “Fuzion” Civic Si, as a showcase for a new brand of tyres aimed at the tuner market. The new brand is called Fuzion and the tyres on the Civic Si project vehicle are size 225/45 ZR17. The car also incorporates a tyre pressure monitoring system, from SmarTire USA.
Earthmover and agricultural tyre and wheel specialist Titan Europe is to be listed on the AIM market in London, creating a separate public company from owner Titan International. The value of Titan Europe will be 30 million Pounds Sterling (US$50 million) and Titan International will remain the largest stockholder.
In the US, the Pirelli Driver Experience, in conjunction with the Panoz Racing School and Audi Driving Experience is being used to entertain and educate dealers. Up to 80 dealers a day undergo expert instruction from professional drivers on vehicles fitted with Pirelli high performance tyres, thus increasing their product knowledge and appreciation.
Yokohama has announced that it is to spend US$26 million to double capacity at its Chinese factory to 1.4 million tyres a year by the end of 2004. Originally the timetable for the expansion was the end of 2006, but increased demand has prompted Yokohama to bring the plan forward.
Honda’s net profit for the third quarter was up 58 per cent to 137.36 billion Yen (1.08 bn Euro). The main reasons were strong sales of the Accord in China and the USA, plus good US sales of the Pilot and Element SUVs. Operating profit was down slightly at 151.69 billion Yen (1.2 bn Euro), compared with 153.05 billion Yen for the same period last year. Despite the good figures, Honda says that full year revenue will probably be lower than forecast, due to unfavourable currency movements and continued low sales in Japan.
Yesterday we said that a Goodyear shareholder was instituting a class action against the company over its re-statement of profits, alleging that Goodyear deliberately misstated its profits in order to maintain an artificially high share price. Today, the company has been hit by a flurry of similar actions as lawyers across the US leap on to the bandwagon. A typical announcement from a firm with offices in Connecticut and California says that it has commenced a securities fraud class action claiming damages against Goodyear, Samir Gibara, Robert Tieken, Robert Keegan and Stephanie Bergeron and invites disgruntled shareholders who bought Goodyear shares at the time in question to join the action. No doubt other actions will be brought as more and more law firms try to get in on the act – something which will do nothing to improve Goodyear’s relations with both investors and financial institutions.
Continental’s nine-month figures would have been 5.7 higher than for the same period last year, but currency exchange effects mean that they were virtually identical at 8.485 billion Euro. The EBITA (earnings before interest, tax and regular goodwill amortization) for the nine months was up 20.7 per cent to 661 million Euro (2002: 547 million). The return on sales was 7.8 per cent (2002: 6.5 per cent). Sales rose at Continental Automotive Systems and at ContiTech. On the tyre side, sales and earnings increased for the Passenger Tire division, but declined for Commercial Vehicle Tires.
Southam Tyres has announced that the company is to be the exclusive UK distributor for the Merit brand of 4×4 tyres from the USA. Southam specialises in tyres for 4×4 vehicles and the first sizes in the Merit range will be available to the trade this month.
There are reports in the Asian press that the Indonesian Bank Restructuring Agency (IBRA) has sold tyre manufacturer Gajah Tunggal and Gajah Tunggal Petrochem Industries for the equivalent of US$214 million. The purchaser is Singapore-based Garibaldi Venture Fund; one of five bidders. IBRA took over Gajah Tunggal as a debt settlement by Indonesian tycoon Sjamsul Nursalim, after the financial crisis of the late 90s.
A judge in the USA has conditionally approved a settlement to a class action between Goodyear and homeowners, who allege that heating hosing installed in their houses was faulty. The settlement is worth $236 million and Goodyear has agreed to contribute $76 million over five years, with a possible further $40 million in contingency payments.
For the fourth year running, Michelin was ranked highest for customer satisfaction by motorists in the US, buying replacement tyres for cars and light trucks. These two accolades mean that Michelin has achieved no fewer than 37 such awards – more than all other tyre manufacturers put together. The company has also won a J.D. Power award every year since they were first introduced in 1989.
Bridgestone/Firestone North American Tire have signed a ten-year agreement to continue to supply tyres as OE on Kenworth and Peterbilt trucks and other Paccar vehicles. Bridgestone was named as “standard OE tyre” by Paccar back in 1991 and are supplied on all new vehicles in the USA unless the customer specifies otherwise. In Europe, Paccar supplies vehicles under the DAF, Foden and Leyland names.
GM has announced a 3Q net income of $425 million, compared to a net loss in the same period last year. The downside was that the group made more money from its finance operations than from selling cars, with profits falling in North America and a loss in Europe of $152 million. Things were better in Asia, where profits more than doubled to reach $162 million. GM warned that declining markets in the US and Europe, currency values, increased costs of the new labour contract with unions in the USA and on-going pension costs mean that the group will not achieve its aims for 2003 in the US (to earn at least $1.7bn) nor in Europe (to lose less than $200 million).
Continental has bought a wheel sensor business with operations in Japan and China. Continental and its Japanese partner Nisshinbo Industries bought Nagano Japan Radio Co.’s wheel sensor unit as well as its Chinese subsidiary. Nagano Japan Radio Co. produces sensors used in anti-lock braking systems, with much of its production at its Chinese plant. The unit employs around 1,350 people and had sales of around 65 million US Dollars in 2002.
September new car registrations for Western Europe rose by 4.4 per cent over last year across the main five markets (France, Germany, Italy, Spain and the UK), which was better than many industry analysts had forecast. Over the 15 EU members, figures were broadly similar (+4.5 per cent). In unit terms, registrations totalled 1,363,206 units.
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