JK to focus on commercial radials
J.K. Tyre, which so far had been focussing on car tyres, is banking on truck and bus radial tyres to propel growth. The JK Group is Indias leading manufacturer of four wheeler tyres. But now it wants to create a market for radial tyres for trucks and buses. Radials are 25 per cent more expensive, but offer 10 per cent higher fuel efficiency and last longer than normal bias tyres. JK is offering fleet operators a money back guarantee. A. K. Bajoria, president of J. K. Tyre said, Theres a huge opportunity. The sky is the limit. People have to be educated about the fuel efficiency and durability of radials.
Continue ReadingHayes Lemmerz in agreement with Hendrickson
Hayes Lemmerz International has announced that its Commercial Highway & Aftermarket Group has a long term agreement with Hendrickson Trailer Suspension Systems. This agreement covers the supply of Ductile Iron hubs and CentruCast brake drums for HN and HP trailer applications as well as product development of future wheel-end components for the On Highway Transportation Industry. Additionally, Hayes Lemmerz will continue to expand supply of Genuine CentriFuse Brake Drums and Centrulite Hubs to Hendrickson Trailer Suspension Systems for lightweight applications.
Continue ReadingBridgestone Disappointed With Union Stance
Bridgestone/Firestone North American Tire, a division of Japanese tire maker Bridgestone Corp., is ready to return to the negotiating table with the United Steelworkers of America, a spokesman told Dow Jones Newswires on Monday. The company is waiting to hear from the union, which broke off contract talks last week, said spokesman Dan MacDonald. The union represents 6,000 workers at six U.S. tire manufacturing sites in Tennessee, Iowa, Ohio, Arkansas and Indiana. Bridgestone/Firestone operates two non-union factories, and a chain of Firestone retail stores.
Continue ReadingGoodyear delays publication of third quarter’s figures
Yesterday Goodyear communicated to the Securities and Exchange Commission (SEC) that they had not yet completed the restatement of the previously announced results for 1998 through to the second quarter of 2003 and, therefore, would not be in a position to submit the figures for the third quarter of 2003. Goodyear shares fell by 9 cents to 6.64 US dollars.
Continue ReadingGoodyear asks for more time (update)
The deadline for Goodyear to release its financial results for the third quarter has been extended from last Friday to this Wednesday, after the tyre maker asked the Securities and Exchange Commission for more time to finalise the figures. Goodyear also asked for more time to complete the restatement of its accounts for the past five years. The company has indicated that its third quarter loss will be in the order of $106 million, or 60 cents per share, which is higher than some analysts forecast. The loss will be Goodyears eighth quarterly loss in the past 12 quarters and the company says that its loss for the first nine months of this year will be between $310 million-$335 million. A Goodyear spokesman would not comment on whether the 3Q figures would include any special charges covering factory closures or other restructuring costs.
Continue ReadingA marriage made in heaven? (update)
A short time before the announcement of the joint venture between Michelin and Apollo Tyres, the Indian company broke off its alliance with Continental. An Apollo spokesman said that the arrangement with Conti was only a technical tie-up. As far as we are concerned this (the jv with Michelin) is a real marriage. Michelin paid around $28 million for a 14.9 per cent stake in Apollo and the French company owns 51 per cent of the joint venture company, which is called Michelin Apollo Tire. MAT plans to invest $70 million over the next four years in building a manufacturing plant in India.
Continue ReadingMichelin in JV with Apollo
Apollo Tyres has joined with Michelin in a joint venture company called Michelin Apollo Tyre to manufacture, market and sell truck and bus radial tyres. We are scouting for an appropriate location in the states of Maharashtra, Karnataka and Tamil Nadu. The commercial operations will begin by September 2005, said Onkar S. Kanwar, Chairman, Apollo Tyres Ltd. Michelin will have 51 per cent shareholding and Apollo 49 per cent in the new Michelin Apollo Tyre Ltd. The Apollo board of Directors has also approved Michelins purchase of 14.9 per cent of equity share capital by means of a preferential allotment from Apollo Tyre Ltd for about 28 million US dollars. The joint venture comes in the wake of ongoing road improvements and highway building projects being currently undertaken in India. While the Radialisation level in the passenger car segment is around 75 per cent, in bus and truck, its less than 2 per cent. We plan to increase this to 5 per cent in next three years, added Kanwar. Edouard Michelin, President Michelin said, We want to become Indian in India, French in France and Chinese in China and we believe that we have just the right tyres to match the Indian conditions.
Continue ReadingTyre Wars: An overview of the wholesale tyre conflict
The tyre trade has been buying and selling tyres for over 100 years. One might have imagined that it would have settled on a profitable, manageable and structured method of distributing car tyres from manufacturer or importer to retailer by now. However, it hasnt and one suspects it never will. Way back in the mists of time life was simpler. The tyre manufacturers supplied their tyres to the vehicle manufacturers and tyres were supplied at the local garages. The number of brands available was limited and people tended to buy what they wanted at the garage displaying their brands logo. In the 1960s tyre manufacturers would have supply arrangements with local dealers who would agree to take their brand of tyres and then redistribute to local tyre fitters, all at fixed retail prices of course. Then the manufacturers decided that they could deliver, and they cut out the local dealer, they set up their own logistics operations and offered to deliver tyres to anyone who would buy them. The result was chaos. In the meantime, the network of local tyre wholesalers in the UK was developing. The manufacturers realised that they could not survive delivering just their own brands so they delved into the market with their own tyre wholesale operations. At the same time there had been the development of a number of regional tyre wholesalers. Of which Stapletons had become a national player.The co-operation of strong regional wholesalers across the UK culminated in the establishment of Group Tyre. Whilst Stapletons and Group Tyre dug in for a long war a third player entered the fray. Hampshire-based Micheldever, the sleeping giant, decided to make some moves to expand out of its Southern base. It first bought Southam Tyres, then opened a warehouse at Chepstow, and now Halifax with rumours of interests in the North East being rife. Battle was joined. To listen to the larger operators it would be fair to presume that no independent had any involvement in the fleet market or the franchised dealer sector. However the independent trader is well aware of the situation and whilst some may be content to work on ever diminishing markets, others may be taking another view of the situation.
Continue ReadingRaising the profile of Truck Point
Taking the wider view of the picture, trucking is now, for most medium to large operators, an operation that requires a varying degree of international transportation. That exposes drivers to conditions in foreign markets that they are not ideally equipped to handle. European service is notoriously poor, and equally notoriously expensive. All fleet operators agree that any international operations require international breakdown recovery cover. This causes difficulties for all manufacturers, with limited coverage in Europe. Bridgestone have solved this through a pan-European network of independent dealers operating under the Truck Point banner. Truck Point has some 220 independent commercial tyre specialist outlets in the UK and a total in excess of 1,600 across Europe. The operation covers most of Western Europe and Scandinavia and is now expanding eastward into Poland and Hungary and other states as the demand for the service expands. Bridgestone Europe has recognised the need to build a strong Truck Point network, and has recognised an urgent requirement to develop brand awareness of Truck Point across Europe. In light of this the company has launched a multi-million pound UK campaign to increase Truck Point awareness in the tyre trade and in the fleet sector. This is supplemented by an advertising campaign across Europe. Roger Moulding Marketing manager for commercial products at Bridgestone UK, told T&A, We need to tell people what Truck Point is about and the changes we are making to the programme. The Truck Point awareness campaign comes at a time when the competition in the truck tyre sector is heating up. There are opportunities being created in the UK by the divesting of commercial services by Continental, There are changes afoot at ATS Euromaster and the Goodyear situation, perhaps unfairly, casts a shadow over Hi-Q – though Goodyear is far from being bowed and the trade can expect developments in that area shortly. However, for the independent commercial tyre specialist there is really only one possible route forwards in dealing with the fleet market, and that, in the UK certainly, has to be Truck Point.
Continue ReadingMaxsport Competition Tyres: Retreading the motorsport way
In todays economic climate there are few people investing in car tyre retreading. The received wisdom is that in the UK car tyre retreading is dead or dying, and that across Europe it is seriously ill. However, Peter Burgess, tyre trade enthusiast and entrepreneur has done just that. He has invested in a car tyre retreading plant, which for many people in the know is tantamount to confirming a kind of madness not seen since George III. However, Peter Burgess reveals that there is indeed method in his madness. Maxsport competition tyres have been around for 15 years or so. The brand was originally owned by rally enthusiast Redmond Barry. Unhappy with paying high prices for motorsport tyres, Barry bought a few moulds and contracted an existing retreader to produce the tyres for him. Initially he had tyres made for himself and a few friends but the demand grew and the Maxsport brand developed a role in the motorsport sector. By 1993 the brand was sold to Monarch and Barry took on a role as sales consultant for Maxsport. When Monarch went into receivership Redmond Barry and Bill Madison bought the Maxsport side of the business. The next couple of years were a bit of a rollercoaster as manufacturers came and went. In the meantime Peter Burgess had been selling Maxsport motorsport tyres through his Treble B outlets and directly to the grasstrack market. This experience with the brand and a knowledge of the market led Peter Burgess into a business relationship with Redmond Barry which resulted this year in the opening of a brand new factory dedicated to manufacturing Maxsport Competition Tyres.
Continue ReadingThe Sleeping Giant Stirs
The Micheldever wholesale operation has been rapidly growing but until 2001 had been concentrated in the South. However, the desire to replicate the wholesale success achieved in the South had led Tony to search for strategically placed wholesale premises initially in the Midlands and North of England, and when Southam Tyres came on the market in October 2001, Tony beat off competition from UK, European and Far Eastern wholesalers to acquire the Southam business. This immediately provided Micheldever with the UK’s most successful 4x4 tyre distributor and its specialist sales team, plus exclusive distribution rights to BFGoodrich 4x4, General Tire and Roadhog. However, due to virtually zero investment from its previous owners, the Southam warehouse was poorly equipped, lacking adequate storage systems and having an ageing fleet of vehicles. The Micheldever investment came swiftly, with a new fleet, tyreracking systems and a vastly increased range of stock. The benefits of having the most comprehensive range of car and 4X4 tyres available in the Midlands quickly led to excellent sales results for the previously product starved Southam sales teams. However, the move that really sent the message out that Micheldever had intentions to become a national player was the announcement of the new Halifax depot. A purpose built warehouse on four floors it will have a capacity for 600,000 tyres. By mid 2003 work was progressing well at Halifax, and finally in Sept 2003 the UK’s largest tyre warehouse commenced deliveries on a phased schedule. Obviously for Micheldever the main thrust of the business at present is the development of the wholesale division and taking the offer to the trade across the UK. One of the much-vaunted drivers for offering national coverage is the potential to be developed in the franchised dealer network. The opportunity to supply tyres as first fit on fleet cars through the franchised dealers is reportedly enormous. Tony Todd is adamant that there are two factors to being successful. The first is that you cant sell it if you havent got it; the second is that you cant do the job unless you have got the right tools and the right people in place.
Continue ReadingSapphire and Lafarge: Offering the best solution to waste tyres?
Tyre disposal is an issue that affects everyone, not just those in the tyre business but every individual everywhere. If we dont find a solution to tyre disposal we will have an enduring and ongoing waste tyre problem. The use of tyres as fuel in cement kilns is becoming an increasingly important option, although this route to disposal has been resisted by some local communities. Sapphire was established with support from Lafarge and Michelin as a sustainable route of tyre supply to Lafarge, and as a ready route for the tyre industry to dispose of tyres in advance of producer responsibility. Jamie Randall, MD, says, We do work closely with Michelin but we are keen to be seen as a an industry wide used waste tyre disposal route open to everyone. The only reason tyres have a value, or rather a use, is because of the millions that Lafarge has invested in plant and equipment. If people have a dream of the gate fee disappearing then they are mistaken. Without the gate fee the operation loses much of its value and Lafarge would not be using tyres. “We have to recognise that the funds to secure this high class disposal route are available: one way or the other every tyre changed from our cars attracts a charge at the retailer or elsewhere for its ultimate disposal. It is important that the tyre industry keeps in mind that Lafarge is not in the business of processing tyres, it is in the business of making money, which it does through the manufacture of cement. In the meantime, technology and economics, if we allow the gate fee, mean that tyre use has become an important element of Lafarges, and others, cement manufacturing process. That may not always be the case. Lafarge and Sapphire will argue that their investment requires a gate fee to ensure its ongoing profitability. The tyre sector will look at the fiscal benefits of using tyres as opposed to fossil fuels and argue that a lower gate fee at least could be accommodated. Ultimately Lafarge has the option of using tyres or other fuels. If it becomes more economical to burn sewage, for instance, then what happens to the tyres Lafarge would no longer require?
Continue ReadingBe A Sport
The variety of motorsports is terrific; from the single seater Formula 1 and Formula 3 cars to events such as touring cars and rallying, where the cars – and tyres – at least look like the ones that we see on the roads. Then there is the two- (and three- if you count sidecar racing) wheel motorsports sector. Many tyre manufacturers are active in at least of these sectors, while some supply tyres across the motorsports spectrum. Their motive is usually publicity and brand exposure, although there may be technical spin-offs or commercial advantages through being allied with a winning team. Whatever the reasons, many tyre manufacturers are heavily involved in motorsports. We take a look at who, and why.
Continue ReadingReview Of The Year
Another year nearly gone and, as usual, the tyre business has seen its fair share of comings and goings, good news and bad news, plus a host of new products. Our review of 2003 will remind you month by month of who did what, events both at home and overseas and people who made, and who were in, the news. Also there is a talking point for each month, focusing on a particular aspect of that months news. Jog your memory with our in-depth look back at the year.
Continue ReadingWestern European car sales down
Western Europe new passenger car registrations for October 2003 amounted to 1.179.024 units, representing a decrease of 0.3 per cent with respect to October 2002. The number of working days in October 2003 was the same as in October 2002. This basically flat result seems to point towards a stabilisation of the market, in line with most economic indicators. National figures show increases in 7 out of 15 EU countries, ranging from +5.4 per cent in Luxembourg to +33.9 per cent in Finland. Spain was the best performer among the 5 bigger markets. Decreases ranged from -0.3 per cent in Italy to -11.6 per cent in the Netherlands and Denmark. Cumulative figures for the first ten months of the year show a closing up of the overall decrease, now -1.3 per cent. Five countries post positive figures, ranging from +0.3 per cent in the U.K. to +25 per cent in Finland. All other countries report decreases, ranging from -0.6 per cent in Luxembourg to -20.2 per cent in Portugal.
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