Tyres are among 132 different products which will have to carry the China Compulsory Certification (CCC) mark from next month if they are to be sold in the People’s Republic of China. This applies to domestically-produced and imported products. The CCC mark is a product safety and quality certification system and the mark can be acquired from the Certification and Accreditation Administration of the PRC.
Bandag Inc. has reported a drop in sales for the quarter ended March 31, 2002. Consolidated net sales for first quarter 2002 were $192.5 million, a decline of approximately six percent compared to net sales of $205.1 million in the same quarter of 2001.
Nokian Tyres have released first quarter results. Turnover was up 10.3 per cent at 84.5 million Euro (Q1 2001: 76.6 m). The operating result was -1.0 m Euro (-1.9 m) and the result before tax was -4.0 m (-5.0 m). The net result was -3.3 m (-3.7 m). Sales and profits of passenger car tyres rose, while sales of heavy tyres decreased, as did sales of retreading materials. Sales of the chain Vianor were up, but the loss was greater than Q1 2001. Nokian’s aim for 2002 is to achieve better turnover and profit than last year.
Goodyear has reported a first quarter loss of $63.2 million; larger than many analysts expected. The biggest regional operating loss was $51.3 m, incurred by the North American Tyre operation. Europe was profitable with operating profits of $16.6 m (Q1 2001 $31.4m), as was Asia. Sam Gibara declared himself “disappointed” by the figures, but he expected the company to “make progress in the second quarter”. The loss was blamed on production cuts, currency levels and the return of stock worth $10 m when the Penske Automotive Center chain closed. Despite the figures, Goodyear’s shares rose 3.6 per cent on expectations of profitability in the second quarter.
Spelman College, in Atlanta, recently opened the Goodyear Tire & Rubber Company Synthetic Chemistry Research Lab. The lab was named for Goodyear as recognition “of the company’s belief in the importance of a diverse workforce and for investing in the potential of African American women scientists.” Spelman College is recognised as a premier private, liberal arts, historically Black college for women.
In the US, Firestone has denied reports that it is preparing to settle lawsuits with consumers who claim they were sold faulty tyres. A figure between $200 million and $300 million was mentioned. Firestone says there is no common defect in the tyres and the company is prepared to contest the cases, which are separate from those claiming personal injuries as a result of an accident.
Michelin Group income increased by 4.1 per cent to 3.8 billion Euro, ahead of analysts’ estimates. This was assisted by volume, pricing and currency in Michelin’s favour. Sales for 2002 have started on a positive note with volumes up on the same quarter in 2001. However, the key brands have fallen and the truck tyre market is dropping faster than expected. Price increases have so far held and Michelin believe they are on target for a 6.7-7.4 per cent margin in 2002, but this is dependent upon the price increases holding. The sales mix in the North American market is said to be precarious and under attack from the growth of private brands in the USA, and flag brands are still suffering as a result of the Firestone recall.
Cooper Tire & Rubber Company has announced, from its headquarters in Findlay, Ohio, a 2002 first quarter net income of $26 million US dollars. Net sales were $813 million US dollars, representing a seven percent increase over the first quarter of 2001.
Superior Industries International has reported that net income for the first quarter of 2002 has exceeded analyst expectations with revenue and shipments reaching record highs. For the first quarter 2002 net income increased by 7.6 per cent or 0.65 dollars per diluted share. Shipments of aluminium wheels increased by 16 per cent bringing revenue for the first quarter to 186,532,000 dollars, a record for the company and a 12.3 per cent increase on the same quarter for 2001. The results include the write off on non-recurring start up costs of 1.653 million dollars in respect of the launch of the new aluminium suspension parts operation. The joint venture wheel manufacturing operation in Hungary also posts profitable results.
The Heafner Tire Group is changing its name to American Tire Distributors as from the 4th July 2002. The new name reflects the national nature of the business and focuses on the distribution element of the company. The name change is part of a national branding operation to standardise the company image and operation throughout the USA.
Ford reported a loss of $800 million for the first quarter, compared to a $1.13 bn profit for the same period last year. The figure includes $708 million in goodwill write-downs, mainly for Kwik-Fit, although core automotive operations lost $310 million in Q1 (Q1 2001: + $748 m). Despite the figures, Ford shares rose 2 per cent as the company forecast that it would outperform the market in Q2.
Software supplier MSC, working with Hayes Lemmerz, has reduced time and materials costs in automotive wheel manufacturing and design by using its MSC Acumen and MSC Fatigue software to perform durability analysis. Software simulation has allowed the design of lighter, longer lasting products which can save millions of dollars in manufacturing, maintenance and warranty costs. Khosrow Namdarian, senior structural analyst with Hayes-Lemmerz, stated “The advantage is that if you make 4 million of just one aluminium part per year and can save a quarter of a pound of aluminium per part, that adds up to one million pounds of aluminium saved in materials costs on just one part.”
Nationwide Autocentres (NW), the Solihull (UK)-based car servicing specialist, has successfully completed the purchase of Lex Autocentres Limited (LA) from the RAC/Lex Service PLC. NW was formed in January 2001, when it acquired 41 of the Lex Autocentres. A further four independent garages were added to the network during 2001. With this acquisition, NW claims to be the largest independent network in the UK with 142 centres and a sales turnover of approximately £40m. Both NA and LA specialise in vehicle servicing, MOT testing, mechanical repairs and maintenance for both retail and fleet motorists.
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Daewoo workers in Korea have voted for the merger of the company with General Motors. The union had the final veto over the sale, under which GM will take a 67 per cent stake in Daewoo, with the remainder going to creditors, but almost 70 per cent of the workforce voted in favour. Daewoo ran into trouble nearly 18 months ago when the break up of the large Daewoo organisation left the car maker with debts totalling 10 billion US$.
The car makers usually use the Geneve Car Salon not only for the presentation of their newest models and show cars but also for a position-fixing. Because they are in all the world’s single markets present and – especially the volume car manufacturers – in most of the market segments, the differences mostly are only in nuances. Not often before the views were so far away than this year: optimists versus pessimists; pragmatism here, utopism there; the picture of the global car market is rather distinguished. Scientists in the automotive area see the luxury segment on the limit. They believe that the progress in sales some car makers believe in will not happen. Unbroken seems the trend to sport utility vehicles (SUV) and especially to those with a very exclusive appointment. If you see such a car you might think of the roots of offroad vehicles, but the car makers made them to onroad cars. Whereas “normal” cars in the US again lost 10.9 percent market share at the beginning of this year, more light trucks were sold than ever and with a plus of 4.4% made the distance to passenger cars wider. Also in Europe more SUVs were sold, but it is common that the market for this segment will stay under the state of North America. But two other new trends enter the focus: On the one hand so called cross-over models mixing two traditional car segments into one – for example cabrio and offroad. The second trend has the market of small cars in focus: the cars might be small but not cheap as a car like the Mini shows. In Geneve the managers and journalists discussed about company state of business, markets with a sales plus were welcomed, markets with a minus were grieved over: Usually it was the wrong policy, but definitely the bad economy guilty. And the suppliers are always in the shipping lane of the car makers.
