News from Notch Consulting, Inc.

January 30, 2019

Michelin to buy Indonesian tiremaker

Filed under: Tires — Notch @ 2:04 pm

Michelin is acquiring tiremaker Multistrada Arah Sarana to boost production in Indonesia. Founded in 1988, Multistrada had an annual production capacity of more than 180,000 tons in 2017 and generated sales of $281 million.

Michelin will pay $439 million for 80 percent of the Multistrada shares, subject to certain closing adjustments. Michelin will then launch a public offer for the remaining outstanding shares.

Michelin expects to reap synergies of $70 million annually within three years of completing the purchase, in production, sales, and purchasing. To strengthen sales operations, the French company will also obtain a 20 percent stake in Indonesian tire retailer Penta Artha Impressi.

Michelin CEO Jean-Dominique Senard said in a statement Tuesday: “The acquisition of Multistrada represents an excellent opportunity for Michelin to expand its operations in Indonesia, the most populous country in Southeast Asia, and immediately gain competitive, good-quality production capacity without having to create any new manufacturing facilities.”

Pieter Tanuri, Chief Executive Officer of Multistrada, said: “We are very proud of what we achieved with Multistrada and we are confident Michelin is the ideal partner to take Multistrada forward into a new era of growth and success for the benefit of all stakeholders and employees.”

Read the full press release here.

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Giti to relocate Hefei tire plant by 2021

Filed under: Tires — Notch @ 1:23 pm

Giti Tire Group is planning to relocate its passenger and truck tire plant in Hefei, China in alignment with a “greener Yangtze River economic belt” initiative. The greener Yangtze River economic belt initiative was launched by China’s central government in 2016. Giti is pushing forward the relocation plan to improve its environmental impact.

Giti has spent more than $3 million since 2017 to address the odor emission problem at the plant. The company also has been running at low utilization rates of 40 percent for truck and bus tires and 20 percent for passenger car tires.

The Hefei plant, opened by Singapore-headquartered Giti in 1993, produces car, light truck, and medium truck tires. Capacity is listed as 23 million units annually.

The new plant’s location will be determined by year-end 2019, with regulatory approvals and construction plans in place by 2020. The company will break ground on the new plant in 2021 and start facility relocation by 2023.

Giti Tire Group has five other plants in China as well as a joint-venture plant in Indonesia and one in the U.S.

Referenced article found here.

Strong fourth quarter demand helps lift 2018 European tire sales

Filed under: Tires — Notch @ 12:28 pm

According to the latest European Tire & Rubber Manufacturers’ Association figures, the strong fourth quarter demand for replacement tires throughout Europe helped boost overall 2018 car and truck tire shipments over 2017 levels. Fourth quarter shipments of replacement consumer tires rose 2.8 percent to 48.5 million units, boosting annual shipments of car and van tires 1.2 percent to 207.5 million units. Fourth quarter replacement truck/bus tires demand jumped 16 percent to 2.78 million units, helping push annual shipments up 8.8 percent to 10.6 million units. Shipments of OE truck/bus tires rose 4.3 percent to 6.35 million units.

However, shipments of OE consumer tires and replacement agricultural and two-wheeler tires fell short of 2017 shipment levels. Shipments of OE consumer tires fell 3.6 percent to 83.7 million units. Shipments of replacement agricultural tires fell 3.5 percent for the year at 1.24 million units, despite a 10-percent shipment gain in the fourth quarter. Shipments of replacement motorcycle/scooter tires fell 1.8 percent for the year to 8.97 million units, again despite a fourth gain of 8.4 percent.

“All in all, the 2018 figures confirm a stable market evolving according to expected trends, welcoming the continued increase in winter and all-season tires adding to the safety on our roads,” ETRMA Secretary General Fazilet Cinaralp said.

The ETRMA’s data cover 29 European countries, stretching from Ireland in the west to Poland, Bulgaria, Romania and the Baltic states in the east.

Referenced article found here.

January 2, 2019

Marangoni Tread North America expanding Tennessee plant

Filed under: Rubber, Tires — Tags: — Notch @ 5:48 pm

Marangoni Tread North America is expanding tread rubber capacity at its plant in Madison, Tennessee to meet growing demand for its products.

“With unit sales up this year, production had to be increased right away. Independent retreaders’ business remains strong and we expect demand to continue to increase as we move into 2019. We will be adding additional capacity to manufacture the XP Extreme Performance wide-base Ringtread here in the US,” said Bill Sweatman, president and CEO of Marangoni Tread North America.

The new production line, expected to be in operation in the second quarter of 2019, will produce spliceless Ringtreads up to and including 500mm widths.

The project will boost the 14-year-old plant’s overall capacity by 20 percent, Marangoni said, and expand the workforce by 10 percent.

Marangoni Tread North America is a subsidiary of Rovereto, Italy-based Marangoni S.p.A., which recently disclosed plans for a global partnership with Borrachas Vipal S.A. of Brazil in what Marangoni said could become the largest global independent player in the retreading sector.

Referenced article found here.

BKT seeks site for first U.S. tire plant

Filed under: Tires — Tags: — Notch @ 5:27 pm

Off-highway tire manufacturer Balkrishna Industries Ltd. (BKT) announced in November 2018 that it is budgeting $100 million to build its first tire plant in the U.S.

Minoo Mehta, president of BKT USA Inc., said 40 sites in several states are being considered, including sites in Georgia, Mississippi, and South Carolina, states where several plants have opened recently or are under construction. Sites in Alabama, Indiana, and Kentucky also are being considered.

The site will be chosen in January, according to Rajiv Poddar, joint managing director of BKT. He expects site preparation to take three to four months from the day they select the land. The target date for the plant to open is 24 months from the groundbreaking, likely the second quarter of 2021.

Bridgestone to invest $100 million to upgrade Mexican plant

Filed under: Tires — Tags: — Notch @ 1:45 pm

Bridgestone de Mexico S.A. de C.V. is planning to invest $100 million over the next two years to upgrade manufacturing capabilities at its car and light truck tire plant in Cuernavaca, Mexico.

The investment will support innovative processes and new technologies, while also building the plant’s capacity to produce high value-added tires such as run-flat tires and reduced rolling-resistance Ecopia models.

The 38-year-old plant in Mexico’s Morelos state has an installed capacity of approximately 25,000 tires per day, serving original equipment customers and the Mexican aftermarket as well as exports, Bridgestone said.

The Cuernavaca plant is one of two Bridgestone plants in Mexico. The other plant is in Monterrey. It opened in 2007 and produces car and light truck tires, largely for export.

Referenced article found here.

Goodyear to expand Slovenian tire plant

Filed under: Tires — Tags: — Notch @ 12:51 pm

Goodyear plans to expand its plant in Kranj, Slovenia to increase capacity by approximately 25 percent by 2022.

“The demand for premium, larger-rim-diameter consumer tires is growing across EMEA. To ensure the sustainable growth of our business, Goodyear plans to invest €94 million ($107 million) in its plant in Kranj, Slovenia to increase its capacity in this profitable segment,” announced Henry Dumortier, Goodyear’s Vice President Consumer Europe.

The expansion will add more than 58,000 square feet to the factory that Goodyear has owned since 1998. It will boost capacity by 1.8 million units a year and create up to 160 jobs, Goodyear said. Production will focus on replacement tires with 17- to 19-inch rim diameters. Current annual capacity is listed as about 8 million units with 1600 employees.

The first phase of construction will begin in January 2019, with additional phases planned for 2020 and 2021 to reach full capacity.

Referenced article found here.

December 19, 2018

Goodyear closes Venezuela factory; government plans to re-start operations

Filed under: Tires — Tags: — Notch @ 11:09 pm

Citing economic conditions and the negative effects of U.S. sanctions on Venezuela, Goodyear’s Venezuelan subsidiary, CA Goodyear de Venezuela, is ceasing production at its 62-year-old factory in Valencia.

“Goodyear-Venezuela has made the difficult decision to stop producing tires,” the Ohio-based company said in a statement. “Our goal had been to maintain its operations, but economic conditions and U.S. sanctions have made this impossible.”

Immediately after Goodyear announced its closure, Venezuela’s government said it would reactivate the company’s assembly line in an attempt to preserve some of the 1160 jobs that will be lost.

However, Goodyear workers aren’t holding their breath. The government has made similar pledges following other plant closures in the past only to see its efforts fall short.

December 13, 2018

Continental Opens Research Laboratory for Dandelion Rubber

Filed under: Rubber, Tires — Notch @ 2:52 pm

Continental A.G. has inaugurated its laboratory in Anklam, Mecklenburg-Western Pomerania, Germany, for research into the production of rubber from the Russian dandelion, one year after breaking ground on the 323,000-sq.-ft. facility.

The Taraxagum Lab Anklam, which represents an investment of nearly $40 million, is dedicated to the study of dandelion rubber farming and extraction methods, working toward producing an alternative to traditional rubber tree plantations in the tropics.

Nikolai Setzer, a member of the Continental board and head of its Tire division, noted that the company intends to use dandelion rubber routinely within the next 10 years. The ultimate goal, he added, is for Taraxagum-branded products to meet a significant part of the company’s natural rubber requirement.

“We see Russian dandelion as an important alternative and complement to conventional natural rubber from hevea brasiliensis to allow us to meet rising global demand in an environmentally compatible and reliable way,” Mr. Setzer said.

Read the full press release here.

Nokian opens North American headquarters in Nashville

Filed under: Tires — Notch @ 2:04 pm

Nokian Tires P.L.C. has opened its North American headquarters in Nashville, to house the company’s sales, customer service, IT, logistics, and marketing teams. The Finnish tire maker’s previous North American headquarters in Colchester, Vt., will continue to serve as an office and distribution warehouse.

“We are pleased to be a member of the Nashville and Tennessee business communities, and we look forward to deepening relationships here and continuing our successful growth,” said Mark Earl, senior vice president, Americas.

Nokian recently revealed its plan to double sales in North America over the next five years. The plan will be boosted in 2020, when Nokian’s first U.S. plant is slated to open in Dayton Tenn., around two hours from Nashville.

Read the full press release here.

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