Continental and Indian company Metro Tyres are to manufacture motorcycle and scooter tyres under the joint brand name Continental-Metro for the Indian market. Initially, Metro will produce 100,000 tyres and tubes a month for 100cc and 110cc motorcycles, with tyres for 150cc and 180cc bikes coming on stream later. Half of the production offtake will be marketed in Europe and North America – these tyres will carry the Continental name only. Production is set to begin in May and the initial investment is 30 crore Rupees, or around US$ 6.3 million. The arrangement between the com panies will be purely a technology deal for the first three years, after which the companies may explore a possible equity partnership.
At its Annual General Meeting, Nokian Tyres decided to pay a dividend of 1.11 Euros per share. The AGM also authorised the Board of Directors to increase the share capital by a maximum of four million Euros, if desired. At the Board meeting following the AGM, Mr. Matti Vuoria was elected Chairman of the Nokian Tyres Board.
There are reports in the Chinese press that the Tianjin Saixiang Technology Co. Ltd. is to supply moulding equipment for truck radial tyres to Michelin factories across the globe. The contracts will run for the next three years and the first shipment of TST equipment – destined for France – will take place in August.
The new Dodge Ram SRT-10 is the latest and largest in pick-up trucks, with an 8.3 litre engine and 500 horsepower. The new pick-up will be shod with Pirelli Scorpion Zero tyres, size 305/40 22, made in Pirelli’s MIRS factory at Rome, Georgia. The SRT-10 will accelerate to 60 mph in five seconds and has a top speed of 150 mph.
Fiat is to sell Toro – its insurance arm – to De Agostini for 2.4 billion Euros. Last year Toro turned over 5 billion Euros and achieved an operating margin of 3 per cent. Over the past 12 months, Fiat has disposed of assets worth 5 billion Euros.
Bandag Incorporated has stated that its wholly-owned subsidiary, Tire Distribution Systems, Inc. plans to sell 19 stores and nine retread plants to a current independent Bandag franchised dealer and a previous independent Bandag franchised dealer. TDS previously sold nine of its Tennessee commercial and retail outlets in 2003.The shift of TDS locations into the hands of independent Bandag dealers began last year with the sale of several commercial and retail locations in Alabama, Georgia and Tennessee. One of the two transactions involves the proposed sale of seven stores and three retread plants in the state of Louisiana and seven stores and three retread plants in the state of Mississippi to Southern Tire Mart. The second deal sees five stores and three retread plants located in the state of Arkansas going to Trans American Holdings LLC, headquartered in Fort Smith, Arkansas.
Amcast Industrial Corporation has announced that it has sold Speedline, its Italian wheel subsidiary, to a European-based company. The net proceeds from the sale will be negligible. Byron O. Pond, chairman of the board and chief executive officer, said, “Speedline’s recent operating performance has had a significant, detrimental impact on Amcast’s profitability. The transaction should return the remaining Amcast businesses to positive net earnings in its third fiscal quarter.”The company also received news that the New York Stock Exchange believes the company is below the criteria for the NYSE’s continued listing standards. The company no longer meets the equity standard, which requires a listed company to have an average market capitalization of not less than $50 million over a 30 trading-day period and stockholders’ equity of not less than $50 million. The company has expected this action and is reviewing its available alternatives to assure a continuous public trading market for its common shares.
Auropolis analysts expect vehicle production in North America to fall by 10 per cent in 2003 even is a war is avoided or short. The drop will continue even if current price-cutting is extended. Despite action to maintain volumes US sales fell for eight months in 2002 and showed lower year-on-year figures for the second straight year in a row. In a market characterised by fears over some carmakers’ financial foundations, waning consumer confidence and a market which has been almost saturated with overly-cheap cars for three years, the prospects are poor. Past cycles in the US show, that when it comes, the market normally corrects sharply and quickly. Swings in sales of more than 20% from the highest point to the lowest over an 18 month period are typical says the firm. The only reason that the situation might be better this time is because Mexico’s market should grow in 2004 thanks to price cuts anticipated there. Assuming a normal pace of recovery, Autopolis say the North American market will take until 2009 to have returned to its peak level again.
The car fleet tyre market has seen some changes recently. The forerunner of fleet tyre management was, we believe, FTM, first established in 1991. Cutting to the chase, two years ago as part of the Montinex Group, FTM almost went to the wall when Montinex collapsed. Its management included Kevin Parker, who was snapped up by National Fleet, then in the hands of Continental, and Dominic Bateson who in quick time arrived at the helm of General Motor’s backed Fit4Fleet. At the same time Kwik-Fit had been acquired by Ford and there was a drive to expand Kwik-Fit’s coverage of the fleet market. Sir Tom Farmer bought FTM from the receiver and brought in Mike Wise to operate FTM to cater for the independent sector alongside Kwik-Fit Fleet. This was an arrangement which despite Mike Wise’s team’s success in delivering the contracts, remained uneasy as many independents questioned FTM’s autonomy from Kwik-Fit. Some simply had a dislike, or fear, of the Kwik-Fit ogre. Now that FTM has gone and Kwik-Fit Fleet has turned its back on the independents the sector is in a state of flux. This, in depth feature airs the views of the top players in this important and growing sector.The two equity players, ATS and Hi-Q have leading positions in the sector though both freely admit to chasing Kwik-Fit. Central’s role is somewhat less, and anyway is masked in the figures of one of the larger fleet tyre management operation’s figures. ATS Euromaster is in the invidious position of having lost two of its top management, both appointed from outside the tyre trade to bring in fresh approaches. The past year has seen ATS putting a great deal of effort into the retail outlets, perhaps at the expense of the car fleet sector. “The coming year”, says Ian Thomas, strategic development and interim sales director, “will see a redirection of emphasis and a development of the fleet sector alongside the ongoing retail developments.”ATS Euromaster, which we will refer to from here as ATS, has been in the fleet sector for a long time, however it’s interests have historically been largely in the truck and agricultural sectors rather than the car and van fleets. In the truck fleet market ATS lays claim to 35 per cent of the tyre replacement market and 85 per cent of the truck breakdown market in the UK. The inroads into the car sector, though significant, are far less and Ian Thomas admits that in car fleet terms ATS is trailing market leader Kwik-Fit, though he stresses that the company’s second place in the sector is a long way ahead of the third largest player. Ian didn’t say which was the third largest player but at present we might estimate that the honour falls to either National Fleet or Hi-Q, though if AA Tyre Fit is as successful as Centrica hope that position may change within the year.Paul Harrell, retail director responsible for Hi-Q advises T&A that the Goodyear Dunlop equity has been under review and through 2003 will be taking on a new stronger Hi-Q branding, with a reorganisation which truly strengthens Hi-Q, putting them in leading positions in some sectors of the UK market.Mike Wise who proved himself as a contract winner at FTM has been retained as the sales director for Kwik-Fit Fleet. In a frank discussion with T&A Mike was quite open about his thoughts on the market … “Honestly, I don’t think there is a future for the independent tyre retailer in the fleet tyre market … Kwik-Fit wins on every count … there will always be some work for them [the independents], but in the long term I question their viability against the strengths of Kwik-Fit.”To find out how the competition responded to Mike’s outspoken views read the most in depth discussion on the fleet tyre sector ever written …
DoveBid Inc., a provider of capital asset auction and valuation services, has announced it will conduct a Webcast auction for The Goodyear Tire & Rubber Company on March 19, 2003 at 9:00 a.m. Eastern Standard Time in Stow, Ohio.The auction will include the a complete tyre mould building facility including CNC machining and engraving machinery, aluminium foundry, heat treatment plant, finishing and tool room equipment. To participate in this auction, buyers may bid live via the Internet at www.dovebid.com or attend in person.
Dr Peter Kronthaler, Managing Director Pirelli Motorcycle Tyres Germany, has confirmed that production of Metzeler car tyres will go ahead. The tyres will be offered alongside Pirelli and will not be marketed as middle market or budget tyres but have a parity with Pirelli. It is believed that two production lines will be given over to Metzeler production, but sizes, names and prices have yet to be confirmed.
Pirelli has introduced the Diablo Corsa, its latest super sport motorcycle tyre. What makes the tyre unique is that it was produced using MIRS (Modular Integrated Robotized System) technology, with the process being known as MIRS Moto. There is a MIRS Moto line at the factory in Bicocca, near Milan and another at Breuberg in Germany, representing a total investment of more than 10 million Euros. The new Diablo Corsa is OE on the Aprilia RSV 100 R and other homologations are currently under way.
The United Steelworkers of America (USWA) has announced that it is beginning master contract negotiations with Goodyear in Cincinnati. The talks will address contracts covering 20,000 members and 22,000 retirees across the U.S.USWA International Vice President Andrew V. Palm will lead the USWA Goodyear/Kelly-Springfield/Dunlop bargaining team. “The security of our members’ jobs, wages, benefits and retirement earnings are our paramount concern,” he stated. “We are convinced that Goodyear can return to profitability while also ensuring these basic protections. We do not intend to allow the company to restructure itself on the backs of its workers. If they don’t see us as part of the solution, it will only compound problems.”
Cooper Tire & Rubber has purchased Max Trac Tire Co, which is better known as Mickey Thompson. Max Trac leased locations in Stow (Ohio) and Temecula (California) where it distribues tyres for specialist racing applications and off road use. Cooper acquires two tyre brands with the purchase – Mickey Thompson and Dick Cepek.Cooper Tire has supplied Mickey Thompson for a number of years, providing tyres under the Mickey Thompson and Dick Cepek names. In addition, Mickey Thompson has distributed and provided trackside assistance for Cooper’s Avon racing tyres, which are produced in Melksham, England. There are no anticipated changes in Mickey Thompson’s current relationship with suppliers of tyres, wheels or other accessories.
The Board of Directors of Bandag, Incorporated, (NYSE: BDG and BDGA) declared a regular quarterly dividend of $.32 per share on the Common Stock, Class A Common Stock and Class B Common Stock of the Company payable April 17, 2003 to shareholders of record at the close of business on March 21, 2003.