Titan Exploring Viability of Increased OTR Production
Titan International’s board of directors has opted to take advice from financial management and advisory company Merrill regarding the financial feasibility of expanding OTR tyre production. Titan is considering investing in the production of 57 and 63-inch OTR radial tyres, sizes that are in short supply in the mining industry.
“Titan has the engineering and technical expertise to offer these additional sizes,” said Titan International chairman and CEO Maurice Taylor Jr. “We can help solve the tyre shortage in these large sizes, but first we need to obtain commitments from mining companies. Tyres are often mistaken as a commodity, but they are engineered products.”
The company has calculated the production costs of manufacturing up to 6,000 63-inch tyres per annum, and could start making these tyres next year. Such an undertaking would, however, require the company to invest in larger manufacturing equipment and moulds.
Titan, a long-established wheel manufacturer who entered the tyremaking business in 1993, is reported to be the only company in the world with the capability of producing every wheel and tyre used in both the OTR and agricultural sectors. Last year Titan acquired Continental Tire North America’s OTR facility in Bryan, Ohio for $125 million, and at present the company is increasing the range of radials it produces at its Ohio facility, producing tyres up to 51-inches using both established OTR tyre technology and 15-degree tyre technology more commonly employed in car and commercial vehicle radial design.
Merrill Lynch is expected to complete its assessment before a Titan board meeting scheduled for May 17, 2007.