So far the acquisition of General Tire in 1987 has not been a success story. During this year the loss will amount to 100 million Euro at least. This has to be changed, according to Conti’s chairman Manfred Wennemer and Martin de Louw who is responsible for Continental’s passenger tyre division and works in the North American headquarters in Charlotte, North Carolina. The two set out the goal: during the last quarter of 2005 the break-even point has to be reached. Wennemer puts his hope in de Louw as a new member of the board. De Louw in his strategy focuses on new products, the extension of low cost production sites such as Mexico, and the persuasion of a multi-brand strategy that in turn is borne by the brands Continental and General Tire. For the replacement market Continental hopes for good business with the car dealers because the tyres with the prancing horse have been widely sold on the OE market during the last couple of years – there will be a pull-through effect. Wennemer states clearly that Continental will continue its business with truck tyres in North America because this division has always been very profitable.
Ford and Mazda are to invest $500 million in their joint venture in Thailand; a country that Bill Ford says “will spearhead Ford’s Asian growth strategy”. The investment will increase annual production from 135,000 vehicles to 200,000, plus Ford plans to set up a regional headquarters in Thailand.
Although reductions in staff had been expected, the news item still fell like a bombshell: Goodyear, the tyre manufacturer, is sending more than 700 salaried staff home, 350 of these from the company headquarters in Akron, Ohio, alone. The press releases on the subject refer to a “restructuring”, holding that the move was necessary to strengthen attempts to accelerate Goodyear’s turnaround. With this measure, it is said, Goodyear can remain competitive, and CEO Keegan even demands something like a “winners’ attitude” from the remaining associates. This may go down well in America, yet to the ears of staff hit by the cuts, who have not been charged with having done anything wrong, it must sound almost cynical. Meanwhile, Thursday January 16th , Akron witnessed moving scenes among staff. For one thing, no one expected such serious staff cuts; and for another, it looked as if someone had simply gone through the ranks with a rake, plucking out staff members who never even dreamed of being dismissed. The entire proceeding bears a certain handwriting and leads one to suspect that top and higher-echelon management made the decisions more or less on their own, and that middle management, presumably was not involved in the matter and now lives in fear of a loss of functionality. In the end, the work to be done has neither gone away nor even lessened. Instead, it must be carried out by the employees still holding their positions.
Goodyear has announced plans, from its headquarters at Akron, to increase the prices of all its consumer tyres by between four and five percent from the 1st December. This is as a direct result of increasing raw material charges. The increases affect the North American market and apply to Goodyear, Dunlop and Kelly and all associate brands.
Viborg local dealers who ordered new tyres from Continental today got a surprise. They were told to call their management headquarters for advice. Conti had stopped delivery. It seemsthat Viborg has not only been slow to pay the bills but also underpaid them without reason; initiating a quarrel which has seen Continental respond by putting a stop on deliveries. Last year there may have been similar problems between Viborg and another important tyre manufacturer. Jescow von Puttkammer was not available for comment to T&A, but passed the message, “we don’t speak in public about dealer and client relationships”.
Cooper Tire & Rubber Company has announced, from its headquarters in Findlay, Ohio, a 2002 first quarter net income of $26 million US dollars. Net sales were $813 million US dollars, representing a seven percent increase over the first quarter of 2001.
The “Sachs Korea Suspension Company Ltd.” joint venture with Kasco will take over the shock absorber and pneumatic spring activities from the leading manufacturer of automotive components with headquarters in the Pusan area and supply the Korean car manufacturers.
Hayes Lemmerz is the world’s leading global manufacturer of automotive and commercial highway wheels and one of only a few companies producing wheels from both steel and aluminium. Regarding steel wheels, the company, whose headquarters are in the USA, is the worldwide market leader. Regarding aluminium wheels, Hayes Lemmerz is among the leading manufacturers in Europe. Recent years have seen a move from steel to aluminium wheels in original equipment. Looking purely at price, the steel wheel is absolutely unrivalled, but obviously the two criteria of weight and styling have proved more important to the car manufacturers. Realising that it was not enough that the steel wheel is cheaper, the manufacturers decided to become competitive also in the matter of weight. With its newest development of a steel structure wheel, Hayes Lemmerz has attained this target; this kind of wheel is now fitted in a 16 inch size on the newest Ford Mondeo model. But it must be said that is was not only an achievement of the wheel company but also for the producers of new kinds of steel which gives the wheel more rigidity and stability than before and offers the opportunity to make the wheels thinner and therefore lighter. Regarding styling, Hayes Lemmerz tries to mimic the smart aluminium wheels with new finishes that look like aluminium or chrome or are even coloured. Another opportunity is to create a very well-fitting wheel cap. Being also one of the most sophisticated aluminium wheel manufacturers, Hayes Lemmerz tried to develop lighter alloy wheels too. One competitor (Stahlschmidt & Maiworm) has already made much progress with hollow spokes and this kind of wheel is fitted on the top models of Porsche, Audi, and Mercedes-Benz. The idea of Hayes Lemmerz engineers was not to use the spokes but the rim bead section for cavities: they call the invention “Hollow-Hump Technology”.
Even more so than the original symbol of tyre maker Goodyear – the “Wingfoot” – the Goodyear Blimp has become a corporate icon. In June 1925 the “Pilgrim”, first of what was to be hundreds of Blimps, was launched at Wingfoot Lake airship facility near Akron, still headquarters of the world’s # 1 in tyres.
Goodyear and retreader/truck tyre dealer Treadco have announced the formation of a joint venture company, called Wingfoot Commercial Tire Systems. Ownership is 60/40 Goodyear/Treadco. Wingfoot will be the world’s largest network of cv tyre outlets and truck tyre retreading facilities, with coverage coast-to-coast.