Poor Profits For Vredestein
Vredestein’s profits for the year 2000 have fallen to only 200,000 Euro (compared with 10.4 million in 1999). High raw material costs and the disappointing sale of winter tyres were cited as the main reasons.
Vredestein’s profits for the year 2000 have fallen to only 200,000 Euro (compared with 10.4 million in 1999). High raw material costs and the disappointing sale of winter tyres were cited as the main reasons.
Marangoni Tyre has extended its Meteo ESC Winter tyre range with the introduction of four new sizes. These are a 14-inch, T-rated size, two 16-inch, H-rated tyres and a high performance tyre, size 225/45 R17 V, aimed at high-level saloon cars. This is the first V-rated Winter tyre in the Meteo ESC range, which now consists of 24 sizes.
In the German tyre retailing business, the mood has swung towards the negative side over the last year. This is the main result of an annual poll carried out by the Marketing + Management-Systeme (MMS) among 2,400 German tyre retailers. According to the MMS-report, 80 percent of tyre retailers have been disappointed in their economic expectations. Among the co-operation members this is even higher at 85 percent. The main reason for the depressed mood has been the disaster of the winter tyre business in 2000 and there is no sign of any compensation in the form of new business activities. For 80 percent of the companies questioned, their central goal is to improve their service quality during this year. One year ago 30 percent of the retailers had stated that their expectations had been more than fulfilled, for 49 percent the expectations had been fulfilled. This time there are just three percent for whom the expectations have been more than fulfilled and another 17 percent who had achieved their aims. The most serious problem is the high quantity of winter tyres in stock. They block the capacities for the coming summer tyre season and cost a lot of time and money. First calculations are that 28 percent of the winter tyres have been not sold, which means a volume of five million units. With an average worth of 85 DM this adds up to an amount of approximately 400 million DM up to 425 million DM.
At the beginning of April the presentation of Toyo’s new winter tyre, Snowprox S950, took place in Rovaniemi, Finland. The new product was already introduced to the market at the end of last year. The S950 covers the 55- up to the 40-series and has been released in 15 dimensions (from 185/55 R 15 up to 215/40 R 16). For the coming winter season five additional sizes in the 17-inch-sector and with a V speed index are planned.
In the autumn “Snowprox S950” will be available in 55/50/45/40-series. According to Toyo, which celebrates its 25th anniversary in Germany this year, the new winter tyre has (compared with its predecessor “M+S 920”) improved its performance dramatically.
As the 14th annual meeting of the German tyre dealers association announced, the turnover of passenger car tyres increased 44 p.c. over the previous year. Responsible for this positive development was the winter tyre segment which increased 14.8 p.c. to 17 million pieces. In spring 2000 43 percent of all passenger cars had been equipped with winter tyres. This year the association expects – in contradiction to the positive prognosis – a stagnant market. Reason: the bad results in the passenger car sector during the first months of this year.
The first Cooper winter tyre designed specifically for the Alpine market is to be manufactured at Cooper-Avon Tyres’ Melksham (United Kingdom) plant. The “Weather-Master SiO2” will be available in 15 T-rated and 11 H-rated sizes this autumn.
At the INTERMOT – the international exhibition for motorcycles in Munich – the German Tyre Manufacturer Reifenwerk Heidenau has introduced a winter tyre for Scooters. For higher grip under winter conditions, the so-called “Snowtex” features textile fibres in the tread which emerge from the rubber surface after 300 to 600 kilometres driving. Therefore Heidenau suggests changing to winter tyres some weeks before the cold part of the year begins.
Dunlop GmbH (Hanau) expects further turnover and profit increases in the 1999 tyre business. Turnover will rise by almost ten per cent over the previous year to 1.64 billion marks. The pre-tax group profit will be significantly above the 1998 level of 133 million marks. The good business development is due to consistently strong demand for Dunlop tyres both in original equipment and in replacement. High winter tyre sales figures also contribute to this development, representing approximately 20 p.c. in Dunlop’s total German production. Dunlop 1999 winter tyre sales will probably have gone up by 16 p.c. over 1998. Since 1994 Dunlop GmbH has doubled its car tyre sales. During the last few years the Hanau tyre manufacturer has made progress in the high-performance tyre segment far above the market average, and the company operates a profit-sharing scheme for its employees. Against the industry trend, the Dunlop payroll has increased by almost 21 p.c. since 1991, with the number of people working for Dunlop GmbH at the end of November 1999 reaching almost 5,000. If one leaves out the former subsidiary Dunlop TECH, which ceased to belong to the contributing members of the Dunlop GmbH group in the middle of last year, the figure is similar to that of the previous year.
It has almost become a tradition by now: Once a year the German subsidiary of Japanese car manufacturer Mazda invites the trade press to a winter test/system comparison. The journalists attending in Saas Fee in the Swiss canton of Valais were asked to perform a number of driving tests under various conditions. The necessary winter tyres and know-how were provided by workshop partner Continental, and the computer-aided evaluation of the results of these practical tests was handled by representatives from TÜV Rheinland/Berlin-Brandenburg. The most important part of the workshop results was: On snow and ice winter tyres are absolutely indispensable! The tendencies worked out in theory were generally confirmed but, contrary to expectation, no significant difference in handling was discernible between front and rear drive. Similarly, the two front-driven vehicles – whether on TCS or ESP – ended up with nearly the same result. But brake tests with ABS did demonstrate the expected differences in the performance of winter and summer tyres, with the average traction quotient of 88 p.c. (winter tyre = 100 p.c.) for a front-driven summer tyre, however, considerably higher than the 76 p.c. estimated by the group.
Never before so many winter tyres were sold in Germany. The dealers association BRV estimated 17 million units (= +15.3%) for 1999. Also the aftermarket in summer tyres was in plus (+0.9%) with 23 million in total.
Sandra Farmand has won the Snowboard World Cup. Farmand is the promotional star for the “Pirelli Winter Snowsport” winter tyre.
According to the German tyre dealers association BRV (Bundesverband Reifenhandel und Vulkaniseur-Handwerk), in 1999 more than 50 million tyres were sold in the German replacement market, 43 million of them in the passenger car sector. Especially, a new record in winter tyres sales was achieved. Sales in the commercial vehicle sector increased five p.c. to 5.7 million tyres. Whereas retreaded truck tyre sales were stable at 1.7 million units, the fall in sales of retreaded passenger car tyres continued.
Cooper-Avon Tyres Limited will be exhibiting a number of flagship products from both its Avon and Cooper brands at the “Reifen 2000” international exhibition in Essen, Germany from 20-23 June. For the motorcycle market the company will be unveiling for the first time the “Azaro” with Avon’s variable belt density (VBD) technology. Furthermore two new winter tyres – “CR75″ and CR85” – will make their debuts at the show as well as the new 4×4 tyre named “Ranger H”.
The Vredestein NV group consists of five companies with activities in car, transporter, agricultural and industrial as well as bicycle tyres, boots for consumer markets and industrial applications, recycled rubber, compounds and sealing extrusions. The company employs about 2,200 people in total. The first half of 1999 developed according to forecast, with net profits increased to 600,000 euros – 200,000 euros more than in the first half of 1998. Consolidated net turnover yields rose by ten per cent from 98.1 million euros to 108 million euros, and during the period in question cash-flow was up by 1.1 million to 9.9 million euros. Vredestein Banden’s turnover increased during the first quarter due to the long winter and the resulting good opportunities for selling winter tyres. The first half year was characterised by the “Sportrac” introduction, a new tyre for the high speed sector (up to 240 km/h) developed in close conjunction with Guigiaro Design, the renowned Italian designer firm. Sales of the new Sportrac have exceeded expectations, according to the manufacturer. Several sizes are not yet available, so the impact of its introduction should be felt in full during the second half of 1999. In the agricultural tyre sector the recently launched AS radial (Traxion+) was well received. Industrial tyre sales developed positively. An important part of the Vredestein group’s annual result is traditionally achieved in the second half of the year, mainly due to the strong influence of Vredestein Banden’s winter tyre sales. Assuming that economic conditions remain stable in the most important European markets, the company is optimistic that it will once again be able to increase last year’s profit.
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