SmarTire Partner Wins Product Development Contract
SmarTire Systems Incs strategic partner, Hyundai Autonet Company has been contracted by Hyundai Motor Corporation to develop commercial vehicle tyre pressure monitoring systems.
Continue ReadingHayes Lemmerz Looks To Reduce Costs
Hayes Lemmerz, the wheel producer who recently emerged from Chapter 11 bankruptcy protection, is trying to reduce costs without compromising financial recovery. This comes in response to the expectation that US vehicle manufacturers will ask suppliers to reduce prices in order to improve the manufacturers own bottom lines.
Continue ReadingPelmar Engineering Buys Most Of Traiskirchen Machinery
Machinery at the Semperit factory in Traiskirchen, Austria, was auctioned off recently, with most of it purchased by Israeli company Pelmar Engineering Ltd.; one of the worlds largest dealers in new and used tyre machinery. The auction raised around $2 million and, among the equipment acquired by Pelmar, were off the road curing presses and tyre building equipment. Traiskirchen will continue to supply the Continental group with custom compounds, rubberised steel cord and rubberised yarns, but tyres are no longer made at the plant.
Continue ReadingWaste Tyres – The South African Solution?
South Africa has an estimated stockpile of 800 million waste tyres; a considerable achievement for a country that produces only 12 million tyres per annum. Currently most of these tyres are either burned, or retreaded. The former releasing styrene and butadiene, both known human carcinogens, into the atmosphere along with thick black smoke and other chemicals.The South African government recognises that this is not a satisfactory response to the growing problem and is intending to make it mandatory that tyre manufacturers recycle their rubber products. The recycling initiative is estimated to be about to create some 800 jobs in recycling and collection. With only one recycling plant in the country there is a shortage of recycling facilities and the government is in discussions with various companies with a view to establishing further recycling plants. One of the key end products is the use of tyre rubber in asphalt.One of the problems for any investor in recycling in South Africa is the lower volumes experienced in the business compared to Europe or the USA. These lower volumes push up costs and make the already marginal operations less cost effective still. The governments aim is to drive the tyre manufacturers to provide the recycling facilities, one way or another, and to ensure proper disposal of their products. The government will impose a one per cent tariff on the sale of every tyre, this will be used to fund the collection and disposal through The South African Tyre Recycling Process Company, a non-profit organisation that will collect waste tyres and deliver them to recycling points.
Continue ReadingCooper Tire & Rubber: Weak Tire Demand to Leave Earnings Short
Cooper Tire & Rubber Company has announced that it will publish its financial results for the second quarter on July 17, 2003. The company also indicates that it expects those results to fall short of current analyst expectations. This was a difficult quarter, said Tom Dattilo, Coopers Chairman, President and Chief Executive Officer. Raw material prices were dramatically higher and overall demand for replacement tyres was weak. The replacement tyre industry remained very soft during the quarter. Although we did see strong improvement in the latter half of June, it was not enough to offset the weakness earlier in the period. The Company expects earnings per share to be in the range of 13 to 17 cents. These results include charges of 2 cents for restructuring, 4 cents related to temporary tire plant shutdowns, and a total of 2 cents for a minor accrual adjustment and the write off of certain tooling assets.
Continue ReadingThe official Vanto and Zeta Linea launch
Marangonis much delayed official launch of the Zeta Linea came at Italys Adria race Circuit at the beginning of June. Already, the Zeta Linea has been receiving considerable press coverage in Germany where tyre tests are popular features in motoring magazines, and with the tyre trade. In most tests the Zeta Linea is performing at least as well as the benchmark tyres from leading manufacturers and in some tests exceeding their performance. These test included excellent results from the ADAC UHP tyre test.The presentation of the tyres was led by Christophe Huss, Marangoni Tyre Export Manager. Mr. Huss began by highlighting the sluggish growth in the European tyre market over the past decade, an average of 3.4 per cent. Plant facilities had fallen in number from 111 to 83, a drop of 25 per cent. This he compared with Marangoni Tyres growth rate over the same period an average of 22.4 per cent; a performance that he put down to Marangonis specialisation in high value products; snow tyres, and UHP for example.Before taking the tyres to market they were thoroughly tested by TÜV in Germany, RDW in the Netherlands and by German tuning expert Franz Engstler. Marangoni tyres have also been used in the Marangoni Junior Trophy Championship on VW Polos racing in Italy. On the Scuderia del Portello Alfa Romeo in the Carrera Panamericana. The sporting heritage of the Marangoni product is growing rapidly alongside its market success in Europe.T&A has already discussed the marketing process using local dealers as equal partners in the marketing team in the November 2002 issue. However, to recap, some 200 local distributors and agents all take part in the decision making process with Marangoni. They have the close contact with the market and by listening to them Marangoni can work with the market, as it is developing.Angelo Priori, R&D Director for Marangoni presented the key PST issues, the tyre cavity design; processing development; and materials development. Mr Priori explained the new tyre profile with a narrower section and tread arc width for improved aquaplaning and more controlled progressiveness (the adaption to changes in road surfaces); reduced ply length for improved response, reduced weight and greater construction flexibility. A larger curing width to the tyre improves rim seating and minimises moulding defects. The deflection point in the side wall is also higher than before giving a larger response are.The tread has pitch sequence optimised for noise control, whilst the cap/ base is a combination of three compounds. A firmer cap layer to give the required characteristics for the tread pattern, a cushioned base layer for comfort and a wing compound to give the required shoulder and sidewall compounds. This required the development of tyre building machinery specifically adapted to the needs of Marangoni, and although the underlying tyre builder is one used by many tyre manufacturers, Marangonis equipment division has developed modifications to the plant to specifically handle the production of the new Vanto and Zeta Linea tyres.
Continue ReadingNew Drivers at Matador
Since T&A last visited Matador there have been a few changes in the management team. These have been brought about by the retiring of company patriarch, Stefan Rosina Snr. There can be little doubt that Stefan Rosina Snr. is not only a sound businessman, but also an astute politician; if he were otherwise he would not have been able to guide Matador into the free market as he did. The many years involved in the business have placed Mr. Rosina in a commanding position to help develop Matadors relations both with the Slovak government, of whichever hue, and with politicians and businessmen in the new markets of Russia and the former Soviet influenced states. Although no longer at the helm of Matador, Stefan Rosina Snr, still plays a major figurehead role both as a consultant and as a powerful lobbying tool for Matador.He has been replaced as president of Matador by his son, Stefan Rosina Jnr. as President and Chairman of the Board of Directors. Mr Rosina Jnr. told T&A that the company aims to remain fully independent although working towards new projects with joint venture partners in growing markets. Mr. Rosina reported ongoing developments in Russia at Omskshina, where the JV was now producing 1.5 million tyres per annum and selling every single piece on the Russian domestic market where the Matador brand had already developed a strong following of loyal and satisfied customers. Two other joint ventures in Russia were still under development. Much there depended upon final negotiations and Due Diligence work before any official announcements could be made. However, a JV with Addis Tyre in Ethiopia was in the course of being finalised as we spoke. This is a long term investment, we will build gently in Africa through our Ethiopian partners. We have long term plans to develop the region, create jobs and wealth and provide education. In Matador, wherever we are we see the potential to provide good employment prospects through the generations. My father worked for Matador, Miroslav (brother) and myself work for Matador and our children also have started working for Matador. We see that same opportunity for all our employees families.The direction of the company may not have altered but the structure of the upper management has. Stefan Rosina Jnr is the President and Chairman, he is supported by Miroslav Rosina as Vice Chairman and Director of International Operations. The top layer of management is completed by Jozef Vozar, vice president for strategy and General Director Štefan Prekop.
Continue ReadingThe Slovak Rubber Conference 2004
T&A attended the 15th Slovak Rubber Conference to find out what made it so popular with the delegates.As rubber conferences go the topics of conversation can be a source of stunned amazement to the layperson. The idea that people gather from across the continent, or indeed the globe, to discuss the rubber industry is beyond their understanding. If you tell them that the conference is in Paris or Hamburg, they smile knowingly. They understand, they believe, that it is a couple of days of high living on company expenses under the guise of a trade conference. Tell them that the event is in Puchov, in the Slovak Republic and their knowing smile turns to sheer incredulity. Where, they ask, is Puchov? And why would anyone go there?The where is Slovakia, close to the Czech border and the home of Matador. As to why anyone would go there, that may be because the Slovak Rubber Conference is an event of growing interest. The fact that some 200 delegates paid for the privilege of attending suggests that the event has a value beyond a night out sampling Parisian or Hamburg nightlife. Delegates came largely from Eastern Europe and the CIS, but also from the UK, Italy, Finland, Netherlands, Germany and doubtless several other nations.More than one delegate told T&A that the background of the event was of interest. It was generated by the Slovak Rubber Institute supported by Matador. The conference, although a flag flying exercise by Matador, was less commercialised than most others and the emphasis is on technology and business developments rather than an extended sales event - though needless to say some of the presenters and delegates had indeed something to sell. That lack of commercialism left delegates free to discuss the subject matter, make contacts and seek out technological partnerships, rather than face a barrage of sales talk from commission paid representatives. Indeed, one presenter made a rather obvious sales pitch that was greeted with some dismay by the organisers - this was not what they has intended, though inevitably commercialism will penetrate any successful event.The conference was opened by Stefan Rosina Jnr, who has stepped into the position of President of Matador upon the retiral of his father, Stephan Rosina Snr. He highlighted and thanked the delegates for their support of the 15th Slovak Rubber Conference. An event, he said, that represented a coming together of experts from the rubber industry with a growing global importance. It was relevant that this was the penultimate conference prior to European Union entry and he touched on the positive and negative impacts of EU entry both to Slovakia and to other states about to join the EU. Most of the effects will be positive, he felt assured, There would be an access to markets, to technology and the reduction of trade barriers. For the Conference he could envisage it reaching a wider audience once Slovakia was a member of a wider European Union. This should give the conference an even greater stance in the rubber industry.The negative effect though was one that posed a real threat to the industries of the new states. It made acquisition by larger foreign investors more of a possibility, but more immediately it could create a flow of qualified engineers to the West - drawn there by higher salaries, better conditions and a higher living standard. However, ultimately even that negative could be turned into a positive if these skilled engineers were to return in later years with a wider experience and greater skills base.
Continue ReadingCar-makers’ Productivity Gap Narrows
European and US car manufacturers are catching up with their Japanese counterparts in Europe in terms of productivity. Toyota, Honda and Nissan averaged 87.5 cars per worker, in a report issued by the World Markets Research Centre - the European average is 58.6 cars/worker. But the gap is narrowing; Europe-based Japanese companies improved productivity by 5.4 per cent last year, while the improvement average for non-Japanese European manufacturers was 7 per cent.
Continue ReadingRon Shield: An update on Cooper Avon
Avon has been under the ownership of Cooper Tire for several years and under pressure to survive as a stand-alone unit within the company. In todays climate, where tyre manufacturers are shifting production to low labour cost centres, the continued survival and profitability of Avon is a source of considerable pride in Melksham, home of Avon Tyres, and a puzzle to other manufacturers who struggle to make European plants, in particular UK-based plants, contribute to profits.The task of turning Avon into a net contributor to Cooper Tire was one that required some hard decisions being made. Cooper wanted to add value to the business and took on various issues at Avon. The choices taken meant that people suffered but there was also a lack of resources. The Cooper take-over was not simply a case of cutting costs by laying off staff. There was a tremendous investment in resources and equipment. A great deal of funding was spent on the business, and not just on plant. In all some 60 million pounds has been invested at Melksham. That was six years ago and Cooper Avon is a very different business now, from what it was even two years ago.Ron Shield, managing director at Avon, says, The first two years were spent putting the business in order. We are now starting to get closer to where we need to be. Last year was our most successful year ever. We are starting to show Cooper that we are a positive contributor to the business.
Continue ReadingSetting your sites higher – taking advantage of the Internet
The Internet must surely qualify as one of the greatest inventions of the modern era, as there are very few aspects of domestic or business life that have not been profoundly affected by it.So ubiquitous has it become that it is all too easy to forget what a comparatively recent invention it is in little over a decade, it has become an indispensable tool and source of information for the developed world. The Internet has wrought a major change in the way we access information and in the resources available to us.What the Internet does do is give people time and time, as they say, is money. Some of us will remember being impressed by the speed and immediacy of communication afforded by telex, which was hailed as a great invention in its day. When was the last time you sent anyone a telex?Telex was superseded by the fax machine, which in turn is giving way more and more to e-mail. Not only does it give you very rapid communication, but you can send words and pictures - even moving pictures, which is something no fax can do. Immediate communications and a seemingly-limitless amount of information - no wonder so many people and businesses have taken to the Internet so warmly and so quickly.Business or information?There are two distinct types of website; those which are used to transact business and those which supply information only. Lets look at the latter type first.The website has become, to many companies, the latest status symbol, replacing the full-colour, glossy brochure. Company history, product portfolio and a piece from the chairman saying how important customers are and how the staff is one happy family - all can be accommodated on a corporate website which can (and all too often does) go on for page after page.Like the glossy brochure, the website can be in glorious colour, but there are many advantages; the website does not need to be printed or mailed out and, should one million people suddenly decide that they want a copy, you do not have to order a reprint. There is also the advantage that a website can be an evolving entity and can be amended the same day.With many sites existing for the purpose of imparting information clearly and succinctly, it is surprising how many seem to try to make it difficult for the reader. Your corporate colours may look great on your company logo, but it can be a mistake to insist that everything on your site is corporately branded - people will soon get fed up if faced with pages of, say, bright yellow words on a red background. By all means show the logo somewhere, but never forget that words are designed to be read.Business sitesAnd so we move to those websites that are designed for the purpose of enabling customers to do business. It goes without saying that these should be easy to understand and navigate and that they should be totally secure. It helps too if the company is able to stick to any promises made regarding delivery periods and so on.Does it matter if the site is a business-to-consumer or a business-to-business site? There could be an argument made that a B2C site might be made to look more attractive in order to tempt the consumer, but the overriding criteria in both cases should surely be speed and ease of use.In the tyre world, it is notably the wholesalers who have pioneered B2B websites and it is probably true to say that orders through this medium represent a small percentage of their total sales. It is the same with B2C sites - more people visit Tesco stores than Tesco.com to buy their groceries. This fact is eagerly seized upon by those who are suspicious of the Internet, pointing out that a) people would rather deal with other people and b) the small percentage shows that the idea isnt catching on.This rather misses the point, as we are talking about a totally new way of doing business, in a medium that is barely over a decade old. However technologically sophisticated we may imagine ourselves to be, there tends to be an innate suspicion of anything new or technologically advanced. This is especially true among the older generation - when did you last hear a teenager moaning about computers (except when they do not work, or the game is suddenly terminated)? The point of B2B sites is that some people are using them and, granted this might be a small percentage at the moment, few doubt that the numbers will grow as the Internet becomes more of a part of peoples lives. Think what a marvel television must have been when it first made an appearance and the effect it must have had on people, yet today it is taken for granted - children grow up with it and never once ask what it is, or how it works, it just is. And so it will be with the Internet one day.
Continue ReadingBattery market under pressure
In the past we have often commented on the similarities between the battery and tyre markets, notably in the problems faced by both and their reactions to these. One such appears to be a sharp increase in the number of batteries entering the market from the Far East. It is true that many manufacturers in the tyre industry have moved their production to low-cost countries and they are not alone - witness the recent spate of press reports revealing that more and more call centres are deserting the UK and relocating to India - so why should this not be the case for batteries? After all, if all markets are faced with the same economic realities, then is it surprising that their responses are similar?Undoubtedly, there is an element of this in the figures, but no doubt some of the increase is due to products being made by companies originally based in Asia and sold aggressively on the European market.Battery imports from Asia to the EU rose last year by five per cent, to 7.3 million units. Not far behind were imports from Eastern Europe, which were up by four per cent.Most dramatic was the performance of China, which is now Europes main Asian importer, with 2.4 million batteries sold in the EU last year; an increase of 38 per cent over the previous year. But it is not only China, as batteries are coming into the EU from South Korea, Indonesia and Taiwan. In the UK aftermarket, Asian battery imports now account for over 50 per cent of all UK imports.
Continue ReadingRetreading Legislation – Lack of direction from Brussels
The European Truck Tyre retreading industry is healthy and provides the transport industry with high quality products which allows them to reduce tyre cost and transport cost. However, retread products are not legislatively treated equally to new tyres, and this is a growing threat to sustained growth for this industry. The legislative problems faced by the retreading industry were outlined to T & A by Lennart Lindström - product manager at Bandag Europe - during Autopromotec 2003.The basis for the EU legislative framework is the Whole Vehicle Type Approval (WVTA) directive 70/156/EEC. This directive sets out the rules for the use and production of many vehicle parts, including tyres. Up until now, the WVTA has not taken into account the existence of retreaded tyres, nor have any of the quite numerous regulations and directives that exist for new tyres. All legislative work on tyres in the EU is solely focusing on new tyres. The WVTA does not yet exist for trucks, but work is underway to introduce this certification for trucks, and then new truck tyres must meet the same requirements.The certification principle for type approval implies that each authority grants authorisation for a vehicle, a system, a component (like tyres) and this authority remains solely responsible for the conformity of production of the certified product.For retreads ECE Regulations 108 (passenger tyres) and 109 (truck tyres) exists.Despite industry efforts to introduce ECE 108 and 109 into an EU mandatory directive, Brussels has not taken any visible initiative.In absence of the expected and desired EU directive, some member states have started to introduce ECE regulations 108 and 109 into national mandatory legislation. This is the case in France, Spain, Poland, Croatia and the Czech Republic. Other countries like the UK, Sweden and Denmark have begun the national legislative process to introduce them. This still leaves a great number of countries with no active plans to introduce these regulations. It is estimated that over 200 retread companies out of approximately 700 active companies in Western Europe have gained their ECE 109 certificate to date. Absence of equal rules creates an unfair competitive market.Bandag are suggesting that it is necessary to form a retread industry interest group, in order to proactively define potential future legislative content on matters like noise, wet traction and rolling resistance, and work in close co-operation with legislative bodies. BIPAVER and BLIC should, perhaps, take the joint initiative to the creation of such a group.The need to recruit new members to BIPAVER, including supplier members was emphasised by RMA secretariat, Sheila Ikin. This is especially relevant now that BIPAVER is focused on the interests of the retreading industry. One of the causes taken up is the unjustified ban on the importation of retreaded tyres, currently operative in 11 countries known to the RMA. There is a definite need to protect the retread industry against damaging legislation, hence the moves by BIPAVER to persuade Brussels to transpose ECE 108 and 109 from a recommendation to a directive.
Continue ReadingAutopromotec 2003 continues to grow
The Bologna trade fair centre was host to the 20th Autopromotec exhibition. There is little doubt that Autopromotec has become one of the most important trade shows in Europe for automotive equipment, machinery and services for the transport industry. This is borne out by the ever-increasing number of exhibiting companies. This year, there were 936 exhibitors, 662 from Italy, 184 from the EU and a further 90 from other nations. These were located in 12 halls, covering an area of 80,500 square metres, plus 3 outside demonstration areas of 10,500 square metres. In real terms, this is only a slight increase over the previous show in 2001, in terms of participation. During its five-day run 83,850 trade visitors attended Autopromotec, a small rise over 2001. Of this number, 13,464 were from abroad, which was a 5.5 percent improvement. What was significant was the visit by a record 21 official foreign trade delegations specialising in strategic markets within the automotive industry.
Continue ReadingMarketing strategies for the retreading industry
Analysing some of the marketing opportunities open to the retreading industry and how it might approach a common strategy. In doing so, the retreading sector, will initially have to face the fact that as an industry it has never been in a position where it has had to design a classical marketing plan before.Retreads traditionally were taken for granted as the budget option for the tyre industry. All tyre shops stocked passenger retreads and these were automatically sold to budget oriented customers. Budget new tyres did not form a viable competition to retreads at the bottom end of the market because retreads still enjoyed a significant price advantage and many budget tyres were of poor quality. To secure a sale all retreaders needed to do was to assure good prices, good product quality and good service to the retailer. Nowadays, it is clear that these attributes alone are no longer adequate.In the truck tyre market the situation is somewhat different. Retreads have long been part of the life cycle of the tyre. The market has always been considered healthy and so the question as to whether the industrys marketing strategy was being efficient in reaching its message to as much of the potential market as it should was seldom raised. However, with pricing issues now becoming more relevant, the issue of the optimisation of the market is becoming more critical.The impact of the downturn in car tyre retreading has been particularly severe in the UK where sales by UK retreaders fell from 4.4 million units in 1995 to around a million today, with a number of high profile retreaders being forced into receivership. This situation was exacerbated by the strength of Sterling resulting in the almost overnight disappearance of vital export markets.It has to be recognised that passenger retreads are now niche products. There is still a place for passenger retreads in Europe but, unless the generic marketing of passenger retreads is improved, the fear must be that the market will follow a similar path to the United States, where it has now almost completely disappeared.To counter this, a sample marketing plan has been drawn up, the key elements of which are as follows:A scientific research programme to ascertain the performance qualities of retreads, using the results as part of a PR campaign.Direct lobbying of government departments and public bodies with a view to highlighting the environmental message that the retreading industry wishes to portray. At government level, the aim would be to persuade individual departments to accept retreading as the best practical environmental option and to include retreads in their purchasing policy.The incorporation of tyre dealer seminars and training days. This proposal generated some considerable thought as it was felt that there was not much point wasting money trying to change the views of tyre dealers and fitters whose minds were already set on opposing the sale of retreads. Instead, the idea would be to use funds to help in the training and support of dealers who had proved themselves to be positive towards retreads.Allied to this is the decision to create a Green Tyre Dealer Scheme backed up with the production of a retread buyers guide. This would allow the retreading business to channel sales through dealers who support the retreading industry, thereby reducing switch selling. A promotionally effective presence at exhibitions. This would include car and truck shows as well as events frequented by the environmental lobby.A comprehensive PR campaign is proposed, aimed at the tyre trade press, environmental magazines, motoring magazines, the national and regional press and other consumer interest groups such as womens magazines. In addition, the incorporation of a press monitoring service to measure the success of the campaign. It has also been planned to introduce a response service to react to bad press in the same way as TRIB does.For the truck and bus market an informative newsletter is suggested dealing with tyre related issues in general but, allowing plenty of scope for promoting the argument in favour of retreads. This activity is based upon the knowledge that the regular truck press is editorially light on tyre related issues and indeed rarely covers anything concerning retreads.Other activities include the design of a campaign website, the increased use of environmental newsgroups on the internet to promote retreads, the production of brochures and presentation materials for use by fleet engineers, the police, schools and tyre dealers and the production of promotional merchandising items such as cab stickers, tacho holders, mugs etc.Finally, a comprehensive but highly targeted advertising campaign focused on environmentally friendly consumers. Part of this strategy would be the promotion of the Green Tyre Dealer Scheme mentioned earlier.These are the main elements of a package which could make a considerable contribution towards improving sales of retreaded tyres.
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