Will Michelin Play a Role in New Double Coin Plant?
One year after their final break up, Double Coin Holdings and Groupe Michelin may be getting back together again for a project in China, reports Tire Review. The US publication says information originally published by SinoCast Daily Business indicates the two companies are in negotiations concerning Double Coin’s planned passenger car tyre plant in Hefei, China. Double Coin announced plans for the plant in December 2010. Michelin, according to SinoCast, denies details of one rumour that has it taking a 30 per cent share in the new plant, but has offered no other statement.
Focus on Selected Segments Continues with Further Trelleborg Divestment
The divestment programme underway at Trelleborg as part of the company’s strategy to focus on selected segments has taken a further step with the signing of an agreement to divest its brake hoses for light vehicles operation, which is located in Brazil and is part of the Trelleborg Automotive business area. The buyer is the French company Flexitech.
Signs of a rebound in the automotive industry following the recession can be seen in the latest annual results released by Continental AG. The tyre and vehicle components manufacturer reports sales in excess of 25 billion euros. “On the wings of better than expected business in the last three months of the year, we realised sales of over 25.5 billion euros in 2010,” stated Continental Executive Board chairman Elmar Degenhart at the North American International Auto Show in Detroit. Furthermore, despite an additional 480 million euro year-on-year cost to the company’s Rubber Group due to record high raw material costs, Degenhart said Conti’s adjusted EBIT margin will work out to be around 9.5 per cent for 2010.
Escalating Raw Material Cost Prompts Further Bridgestone Price Adjustment
During the first quarter of 2011, Bridgestone will implement price increases on all consumer, commercial, retreaded and specialty tyres sold in Europe. Prices will rise by an average of six per cent, however this will vary between markets and product categories.
Preliminary annual figures released by Kumho Tire show a sizable increase in sales during 2010. The Korean tyre maker reports global sales of US$2.305 billion in its home market and export markets outside North America last year, a 36 per cent year-on-year increase. Sales within the North America region amounted to $770 million, up 29 per cent on 2009. Taken as a whole, Kumho Tire gives a preliminary figure of $3.075 billion for its global 2010 sales, a year-on-year increase of 34 per cent.
Media reports published on January 6 indicate that Continental AG intends to invest up to 220 million euros in Romania to build up capacity in its Timisoara plant over the next two years. Enquiries made by Tyres & Accessories to the German manufacturer’s head office, however, reveal that an inaccurate news report was released through a newspaper in Romania. The company has regularly invested its Timisoara plant since 2004, however Continental media contact Klaus Engelhardt states an investment of this size is not planned.
In addition to price rises in the US, as of January 1 Nexen has increased tyre prices in Europe. According to Nexen Tire Europe, prices for all product segments, including passenger car, 4x4 and light commercial vehicles, have gone up by at least nine per cent. The company says it was compelled to take this inevitable measure as “in the previous few months raw material costs, above all for natural rubber, have skyrocketed.” The company notes that in addition to natural rubber, prices of all products necessary for tyre production have increased.
An article in The Times dated 29 December under the heading “Pressure Grows Not To Tinker With The MOT”, featured the results of a nationwide survey of 4,200 drivers, commissioned by the MOT Forum and supported by NTDA and other members of the Forum, in which more nine tenths of those questioned said the MOT should stay as it is.
European Investment Bank Loan to Finance Trelleborg R&D Projects
Trelleborg has reported signing an agreement with the European Investment Bank for an 80 million euro long term-loan. This loan, the Swedish company explains, is intended to finance a part of Trelleborg’s expenditures for selected research and development projects in number of European countries extending out into 2012. These research and development projects focus on the further development of advanced polymer technology and related products to seal, damp and protect in demanding environments.
During recent years Vredestein has steadily built up its Eastern European business and overseen this region from its operation in Poland, which was established three years ago. Now, from January 1, 2011 onwards, Apollo Vredestein’s markets in Eastern Europe and the CIS will also be serviced by a second “Area Manager Export”, who will take on the responsibility of building up the company’s activities and structure within the region. Stepping into this role is Thomas Mittendorf, who is currently Apollo Vredestein’s public relations and media manager. Mittendorf explained to Tyres & Accessories that he will mainly take care of tyre markets in the Baltic States, the Ukraine, Moldova, Armenia, Kazakhstan and Belarus – markets where Apollo Vredestein currently operates no marketing organisation of its own.
Double Coin to Set Up Factory Through New Subsidiary
Double Coin Holdings has announced plans to invest at least RMB 3.18 billion (£301.5 million) establishing a wholly owned subsidiary in China’s Anhui Province. Within this subsidiary, known as Double Coin Huili Tire Co., the company will establish a new factory capable of producing 15 million tyres per annum. Double Coin will provide RMB 1 billion of the funds for the factory project, with the remainder coming from bank loans and from a RMB 900 million loan obtained from controlling shareholder Shanghai Huayi (Group) Company.
Titan Takes Over Goodyear’s Europe, Latin America Agri Businesses
The European and Latin American agricultural tyre businesses run by Goodyear Tire & Rubber have a new owner following their sale to Titan Tire Corporation. On December 13 the Titan International subsidiary announced its acquisition of the businesses, including a licensing agreement permitting Titan to manufacture and sell Goodyear-brand farm tyres in Europe, Africa, Eastern Europe, Russia, Latin America and North America. The deal is valued at approximately US$130 million, subject to post-closing adjustments.
On December 13 German online tyre retailer Delticom AG announced its acquisition of a majority stake in Singapore-based Tyrepac Pte Ltd, for an undisclosed amount in cash. The transaction, Delticom reports, is structured as a capital increase at Tyrepac.
Brisa, the Turkish joint venture company owned by Bridgestone and the Sabanci Group, has agreed to purchase Bandag’s Turkish operations for US$3.6 million. The company says this move provides Brisa with a “cost-cutting advantage” to the logistics sector and will increase the quality of service it can offer. The acquisition was made by the purchase of 7,508 shares in Bandag Lastik Mamülleri Ticaret Limited Şirketi; the transaction is subject to the usual legal approvals.
Michelin says it is “maintaining its firm pricing policy” in response to rising raw material prices. What this means to consumers is that prices for replacement market new and retreaded truck tyres will increase by an average of around five per cent. The tyre maker says these increases are being gradually implemented between December 1, 2010 and January 1, 2011.