The Chinese Yongtai Group, which once ranked as the 32nd largest tyre manufacturer in the world and which used to produce World Rally Championship tyres for DMack as well as the well-known Durun budget brand, is bankrupt. Shandong Yongtai Group Co., Ltd. officially entered administration on 16 July 2018. On 4 August 2018 Shandong Dongying Intermediate People’s Court published documents showing that Guangrao County-based Caijin Asset Management Co., Ltd.’s application for Yongtai to enter administration had been accepted. The Beijing-based Dacheng (Jinan) law firm was appointed as the administrator of Yongtai Group.
European FinTyre Distribution Limited (EfTD), one of the largest Pan European tyre distributors, has agreed to acquire the privately held Reifen Krieg Group, a leading full-range tyre wholesaler in Germany. As a result, EfTD is set to become the market leader in two key European countries, Germany and Italy, with 1.1 billion euros of total revenue. According to EfTD, Reifen Krieg’s current owners, Holger Krieg and Tobias Fink, will continue as the group’s managing directors
No I am not talking about the unqualifiable rumours that Doublestar made an offer of up to 250 million euros for Zenises. Rather, that in the first week of September we learnt that Doublestar’s proposed acquisition of Kumho was collapsing before the firm’s eyes after the Qingdao-Chinese tyre manufacturer asked for a double-digit discount. And it is also worth considering what all this means for the wider tyre manufacturing sector.
While the vast majority of the UK’s tyre production and retreading capacity refers to trucks and a relatively small amount of car tyre retreading still takes place as well as some specialist earthmover retreading, one of the nation’s largest retreaders makes aircraft tyres. Dunlop Aircraft Tyre Ltd or DATL as it is known has demonstrated strong growth in recent years and is majority-owned by private equity. Put the two together and it begs the question – is Dunlop Aircraft Tyre Ltd (DATL) up for sale?
In case you haven’t heard, as much as 65 per cent of Pirelli is in the process of being sold to ChemChina. It’s a complex plan and there’s a long road ahead, but the deal has been done and so takeover wheels are in motion (see page 28 for complete coverage of this part of the story). So what’s next? The deal can’t fail to have an impact at Pirelli, but what about the other top five tyre manufacturers and beyond? We hinted at market consolidation in this column last month, with reference to restructuring proceedings at Shandong Deruibao Tire Co., Ltd and possible contagion in China; and Pirelli CEO Marco Tronchetti Provera made the market aware of that he was planning to sell his stake within two years in January 2014. But few would have named this particular bidder and this particular timing. Now we are faced with the possibility, even the likelihood that the Pirelli/ChemChina deal is going to precipitate further micro and macro consolidation within the tyre market – even a re-shuffle of the tyre industry’s top 10.
Point S used the platform provided by the Reifen show in Essen to promote a new private brand tyre, a new Point S website and, of course, to meet with members and suppliers. Tyres & Accessories met with Fabien Bouquet, deputy managing director of Point S Development as well UK managing director John Cowderoy and network development manager Dean Dyoss to find out more.
While Point S used the 2012 Reifen show to announce the signing of partnership agreements in South Africa, Slovenia and Canada, at this year’s event the retail cooperatives will be reporting details of its consolidation strategy.
After what it says was “a successful start to the new year,” Continental Corporation has raised its adjusted EBIT outlook. “For fiscal 2014 we intend to comfortably achieve an adjusted EBIT margin of 10.5 per cent instead of the originally advised 10.0 per cent,” announced Continental CEO Dr. Elmar Degenhart at last Friday’s Annual Shareholders’ Meeting.
Michelin has reported full year 2013 net sales of 20.247 billion euros, down 5.7 per cent (or 1.2 billion euros) on last year. Meanwhile operating income was fell roughly 10 per cent to 2.234 billion euros and net income plummeted some 23 per cent to 1.127 billion euros. According to Dow Jones analysts’ consensus was that this figure would fall less – by 22.0 per cent, and operating profit to retreat by 5.8 per cent.
The Yokohama Rubber Co., Ltd. And Kumho Tire Co., Inc. signed a Memorandum of Understanding (MOU) on 29 November. The companies report that they have agreed to open discussions relating to technology exchanges and a capital alliance based on “cross-shareholdings”.
Announcing its results for the first half of 2013, Pirelli has shown a year on year 6.1 per cent reduction in earnings before interest and taxes compared with the first half of 2012. This occurred in spite of a second quarter in which the manufacturer saw signs of improvement, with revenues climbing 8.8 per cent on 2Q 2012 following a 1.3 per cent YoY reduction in the first three months of the year. However, net profit for the quarter was also some way off that of the 94.9 million euro achieved in 2012, at 78 million euro.
Is this the opening shot in the anticipated round of consolidation within the tyre industry? Or is it merely an expression of courage, or cockiness, with Indian tyre manufacturer Apollo in the role of a predator, seeking to grasp the much-larger rival Cooper as prey and in doing so exposing itself to the risk that the US$2.5 billion price will land it in debt above its head? Is attack the best form of defence or has the Indian company overreached with this ambitious and financially-edgy expansion plan?
The first quarter of 2013 appears to have been a "brutto trimestre" for Pirelli & C. SpA, with the Italian firm’s net profit dropping 41.7 per cent year-on-year between 1 January and 31 March. It was, in Pirelli’s words, a period “characterised by an economic scenario still strongly influenced by the crisis affecting Europe, where the demand for goods and services continues to shrink.”
Toyo Tire & Rubber reports it will make changes to its business structure as of 1 January 2013. On that date, the development, manufacture and sales of railway vehicle parts, OA equipment parts, industrial, construction and waterproof materials products will be consolidated into the Toyo Chemical/Industrial Products Sales Corporation. This consolidation will take place in order to optimise management resources in the company’s Diver-Tech business segment, Toyo says. The company, whose name will change on 1 January to “Toyo Chemical Products/Industrial Co., Ltd”, will be operated as a new company which will oversee this integrated business in the Toyo Group.