Tyres & Accessories May 2013

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May 2013

The magazine for the tyre and wheel industries

Tyres & Accessories May 2013

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EDITORIAL

Stage fright WHETHER THE OCCASION IS A CORPORATE PRESENTATION OR A THEATRE PRODUCTION, the moment immediately before you set foot on stage is probably the most nerve wracking. With a triple dip recession narrowly avoided and some first quarter results suggesting that the worst of the downturn is behind us, this is probably a good analogy for where the tyre market at large finds itself as the first half of 2013 draws to a close. One the one hand manufacturer-supplied unit volumes, such as the first quarter figures supplied by the ETRMA, don’t exactly make easy reading and there is talk of restructuring. But on the other hand the worst could be over.

Car tyre demand in the first quarter was down by a double digit percentage across Europe.

However, various product segments are performing better – take truck tyres for example, which according to the ETRMA were down just one per cent to 1.879 million tyres when you compare the first quarter of 2013 with the same period in 2012.

In addition, different markets are performing, well, better than the broad pan-European trend suggests they should. Outside Western Europe, markets like Russia (see further coverage on pages 44 and 84 for more on this) continue to impress despite what is going on over here.

Likewise, when you consider the numbers from different vantage points you get a different perspective on what is going on. In the UK at least any first quarter volume declines reported in sell-in figures were around half as bad when counted from the sell-out point of view, leading us to suggest that demand – although battered – is more robust than many may have thought. Indeed, when you consider the numbers of tyre retail branches in the British market as a benchmark metric, things are considerably more stable now than they were a year or two ago (see this month’s Retail feature, especially pages 29-30). There is even talk of some kind of replacement tyre demand recovery, with the ETRMA suggesting the industry expects summer tyre demand to find itself performing “slightly above last year” by the time the second half of the year is complete.

TYRES & ACCESSORIES 3/201 5/2013

However, at the same time questions of corporate restructuring and specifically the better balancing of supply and demand in Western Europe have been persistent throughout the first quarter of the year and will no-doubt figure in the second half too. Whether or not the retail demand slump witnessed over the past few years is over, large tyre manufacturers are being forced to reconsider the exact details of their European manufacturing operations due to both contextual and investor pressures, both of which have arguably been precipitated by the wider economic environment. The financial crisis may have begun with the fallout of sub-prime mortgage lending and the collapse of institutions like Lehman Brothers, but the ripple effect means the world is now a less stable and less predictable environment for the tyre industry too. And with this in mind, some of the world’s largest tyre markers are seriously considering how long they can continue operating with low levels of production utilisation in low demand, relatively low margin, high cost, highly competitive and less stable mature markets (see page 36).

Only the most pessimistic would suggest the generously proportioned lady got anywhere near singing during the whole credit crunch, financial crises, euro-breakdown, recession saga. But as we approach the end of the first half of the year it does look like some of the financial jitters experienced by routinely profitable companies could be due to the uncertainty associated with questions of restructuring and what is to come. Or in other words, as 2013’s act one draws to a close any wobbles we are witnessing could be a dose of stage fright before the curtains part on the second half of the year.

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ANNUAL DINNER

& TAFF AWARDS PRESENTATION 2013 TAFF Awards in partnership with

DATE & VENUE: Wednesday 16th October 2013 The Hilton Metropole at the NEC Birmingham is justly rated as one of the best hotels in the Midlands and its purpose built banquet suite provides the perfect backdrop

EVERYONE IS WELCOME: The most prestigious event of the year and the key social event for the UK Tyre Industry. All are welcome, so join the Association members and all the ‘movers and shakers’ from the UK Tyre Industry to celebrate our 84th Annual Dinner.

Hal Cruttenden is one of the top comedians working in the UK today, as well as being a highly acclaimed writer and actor. He has toured the UK and regularly appears at top UK comedy clubs, as well as at the Edinburgh Festival.

TICKETS: Members: £95 or £90 each for group bookings of 10 or more Non-Members: £110 or £105 each for group bookings of 10 or more (All prices ex VAT)

To book tickets or for further details please contact us on email: lynnesmith@ntda.co.uk or 08449 670707 ACCOMMODATION: We have a limited number of rooms available at a discounted rate. To book online go to: http://www.hilton.com/en/hi/groups/personalized/B/ BHXMETW-GTYRE-20131016/index.jhtml?WT.mc_ id=POG or phone 0121 780 4242 and quote GTYRE

Hal Cruttenden

THE ENTERTAINMENT:

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NEWS IN BRIEF

Goodyear a Boeing Supplier of the Year On 18 April, the Boeing Company honoured Goodyear Tire & Rubber as one of its 17 most exceptional suppliers. Goodyear was selected from a pool of more than 23,000 Boeing suppliers from around the world and received a Boeing Supplier of the Year award at a ceremony held in San Diego, US.The tyre maker was awarded in the Electronics/Hydraulics/Mechanical category.

“In today’s challenging business environment, an agile supply chain that continuously delivers excellent performance is critical,” said Jack House, vice-president of Supplier Management for Boeing Defense, Space & Security and leader of Boeing’s companywide Supplier Management programme. “The suppliers receiving Supplier of the Year awards have demonstrated outstanding commitment to providing our customers with the bestvalue, highest-quality products and services, while meeting the customers’ requirements and anticipating their needs for the future.”

“Boeing has been a valued Goodyear customer for many years,” added Pierre Jambon, vice-president, Off-Highway Tires, Goodyear.

“We are proud to receive the Boeing Supplier of the Year award. This is an important honour, and we look forward to maintaining a high level of excellence as we continue to supply our premium tyres and services to Boeing.”

Boeing selected its winning suppliers based on statistical measurements of quality, on-time delivery, post-delivery support, cost and the ability to anticipate and respond to changing customer requirements. sg

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Superior Industries names site for new plant As of 2015, Super Industries International will expand its portfolio of Chihuahuamade wheels. The North American aluminium wheel manufacturer announced on 16 April that its new manufacturing facility in Mexico will be erected in the city of Chihuahua. Superior Industries says it and the state of Chihuahua have “agreed in principle to a series of incentives that reflect a continued partnership between Superior and the state.” Superior already operates three manufacturing facilities in the city.

“Our positive discussions with the state government of Chihuahua exemplify the cooperative relationship that has existed for the twenty years that Superior has been operating in Mexico,” said Steven J. Borick, chairman, chief executive officer and president of Superior Industries. “Our team of employees in Chihuahua is a critical part of our success

and we are excited to be able to commit to providing more opportunities there. I personally want to thank governor César Duarte and secretary of economy Álvaro Navarro for providing a commitment back to Superior with incentives that address capital and operating cost and expanding the pool of talented employees needed as we grow.”

Superior previously announced it intends to invest approximately US$125 million to $135 million to construct and equip the new manufacturing facility, which will have an initial capacity to produce between 2 million and 2.5 million wheels a year. The company currently produces approximately 12.5 million wheels annually. Groundbreaking is targeted for around the middle of 2013 and completion of construction anticipated about two years later. sg

2013 IRRDB conference focusing on green tech, hosted in London Organisers have announced that the 2013 International Rubber Research & Development Board (IRRDB) conference will ask “Are we ready for Green Technologies?” The event is being held in London and is scheduled to run 24 - 26 June 2013. The conference has been organised jointly by the IRRDB, Malaysian Rubber Board (MRB) and its UK–based research facility the Tun Abdul Razak Research Centre (TARRC).

As you would imagine it will focus on green and sustainable technologies relevant to the rubber industry, with topics ranging from: the rubber economy, life cycle analysis of raw materials and rubber compounds for specific products and applications of natural rubber, ‘green’

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tyres, tyre labeling, genome research, biotechnology and physiology, cultivation and processing of natural rubber, including crop improvement and harvesting, alternatives to natural rubber (Hevea brasiliensis) and civil engineering applications.

The conference programme will feature a field trip on Wednesday 26 June to the world-renowned laboratories of TARRC at Brickendonbury, outside Hertford. Transport from the Millennium Hotel will be provided. The conference will be part of the 75th Anniversary celebrations of TARRC and will commemorate the work of the IRRDB over more than fifty years. cja

TYRES & ACCESSORIES 5/2013

COMING SOON TO A

T: +44 (0) 1453 891000 E: tyreintelligence@cam-systems.co.uk www.cam-esystems.co.uk/contact

SYSTEM NEAR YOU

NEWS IN BRIEF

Falken-sponsored Deane wins opening Irish Drifting round Sunday 21 April saw some tightly contested drift battles at the Mondello Motorsport Park, with James Deane coming out on top in the first round of the Irish Drifting Championship. In his Falken sponsored Mazda RX-7, the 21-year-old Irishman saw off rivals Gavin Lenihan and Shane O’Sullivan from Team Japspeed, who took second and third place respectively.

Reflecting on his podium finish, Deane says; “We had a great start to the drift season for 2013; I had some hard fought battles but managed to come out on top in the end and the car got massive attention all weekend with its new look.”

Supported by Falken Tyres Europe, James Deane’s SR20powered Mazda RX-7 is a new build for 2013 and features full Falken livery. Deane’s RX-7 uses Falken’s Azenis FK453 UHP tyres along with an upgraded turbo and aero package, combining to create his most powerful RX-7 build to date.

Since competing at the age of 15, Deane has won five professional drift championships and secured over 40 podium finishes in events such as Prodrift, Formula Drift and the Red Bull World Drifting Championship. Following his latest successes, Deane will be racing in the second round of the Irish Drifting Championship in Punchestown; “Bring it on!” he concludes. sg

Deane drifts to victory at the Mondello Motorsport Park

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Nitto seeks ‘influencers’ to strengthen social presence WANT

TO PROMOTE a tyre brand? Not too fussed about being paid for your efforts? Nitto Tire U.S.A. may have just what you’ve been looking for. The tyre maker has launched its ‘Ambassador’ programme, a scheme aimed at its “most loyal enthusiasts” and described as being “the latest extension of its dynamic community building efforts.”

Within the Ambassador programme, the said loyal enthusiasts have the opportunity to “become leaders and influencers within their peer groups.” To help them do so, membership in the programme provides access to Nitto and automotive material such as videos, articles, images and interviews. Ambassadors are encouraged to share this information through their personal social media channels, including Facebook and Twitter.

Rewards points will be given out to active members and a leaderboard will track the most active Ambassadors.

While only the five members with the highest point total will be awarded prizes in any given month, all members enter

the draw to win a set of Nitto tyres at the end of the year.

“Our social media team has built an amazing community around Nitto fans and enthusiasts,” said Nitto Tire U.S.A. president Tomoshige Mizutani. “As such, we are constantly looking for new ways to create opportunities for our fans to engage with us and benefit from their involvement with our brand.”

Nitto Tire U.S.A.’s Facebook fan base passed the 3 million mark earlier this year and the tyre maker claims to be the third most followed Japanese company, behind Nissan and Sony. “Because the online social landscape is always evolving and there is no way of controlling EdgeRank, Facebook’s algorithm responsible for brands’ share of voice and reach, we have to explore new ways to facilitate communication with our 3.2 million loyal fans,” Mizutani added. “Our Ambassador programme helps take back a measure of control and at the same time strengthens our social presence.” sg

Maxxis to boost social networking MAXXIS has announced its plans to miss anyone so we’re casting our net as increase its presence on social networking platforms. New Maxxis marketing manager Amy Colbourne explains that the company’s increased activity on social networks will allow it to offer better customer support, as well as allowing customers to speak directly to the company more easily. The brand has recently launched a new Maxxis Babes website and currently has Facebook, Twitter, Instagram, YouTube, Pinterest and Google+ accounts.

Colbourne says: “We want to give people the chance to interact with us, whether they are at home or on the move. Social media is a great way of doing that. Some platforms are obviously bigger than others, but we don’t want to

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wide as we can.

“The other thing social media allows us to become is far more accessible to our customers. We are now in a much better position to deal quickly with any queries that may arise, through any of the channels they come to us by. We’re looking forward to ramping up the amount of content we’re putting out through social media, and hopefully people will get as excited as we are and become more engaged with Maxxis.”

Maxxis has over 16,000 ‘likes’ on Facebook and over 1,000 followers on Twitter, showing its strong performance on the major social network platforms. akb

TYRES & ACCESSORIES 5/2013

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NEWS IN BRIEF

£100,000 worth of Pirelli tyres stolen at knifepoint

THIS?

REMEMBER

A look back at stories from the past 20 years of T&A

May 1993 Pirelli decided to give up its shares in Continental, thus ending the longrunning ‘takeover/collaboration’ saga.

In the UK, retreader the Technic Group unveiled its Environmental Tyre Control tyre collection initiative, with a video fronted by conservationist Dr. David Bellamy.

May 1988 Continental said that in 1987, the company sold more than 50 million tyres in Europe for the first time in its 126-year history.

At the 32nd Bipaver Congress Prof.

Dr Norbert Walter, chief economist of the Deutsche Bank, told delegates that the proposed single currency for much of Europe would lead to greater competition in the tyre industry.

May 2003 Ohtsu Tire & Rubber announced that it was to merge with its parent company Sumitomo Rubber Industries.

In Korea, Kumho Industrial Co Ltd agreed to sell its Tire Business Unit to a joint venture company for the equivalent of US$ 1.2 billion.

May 2008 Hankook said it would double production capacity of its plant in Hungary to 31,000 tyres a day.

Michelin revealed its intention to invest £14 million in manufacturing and staff training at its truck and bus tyre factory in Ballymena, Northern Ireland.

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KENT POLICE is appealing for witnesses that all the tyres were missing from his to a knifepoint robbery of about 1,500 tyres from two HGV lorries near the Dartford River Crossing. Officers were called just before 7.15am on 8 April after Pirelli brand tyres, worth a combined total of about £100,000, were stolen from two artic lorries. Neither driver was injured in the robbery.

According to the text of a Kent Police witness appeal, at around 1am on 8 April a man knocked on the cabin door of a lorry parked on the side of the road, gesturing that something was wrong with his vehicle. When the driver got out to assist, the suspect threatened him with what is believed to be a knife and forced him back into the cabin. The driver was kept there until about 7am when the offender left the cabin. It was then the driver discovered

vehicle’s trailer. The driver’s colleague, who’d been hauling another load of Pirelli tyres, is also reported to have been threatened with a knife. Half the tyres were within his lorry’s trailer were taken.

“This was a premeditated robbery in which two men were held against their will,” said investigating officer, Detective Constable Simon Williams. “Clearly this is an incident that caused concern and distress to the victims and I would urge anyone that has any information to come forward. Also, if you are offered cheap Pirelli tyres at a price that seems too good to be true, then it probably is.”

If anyone has any information, call DC Williams on 101, quoting CAD 08-0137.

Alternatively, contact Kent Crimestoppers anonymously on 0800 555 111. sg

Cooper breaks ground on R&D centre ON 12 APRIL, Cooper Kunshan Tire enter operation later this year. The tyre broke ground on its new Asia-Pacific Technology Center in China. The ground breaking ceremony was attended by Chuck Yurkovich, Cooper’s vice-president of Global Research and Development, Allen Tsaur (Cao Kechang), vice-president and general manager, Cooper Asia Operations, along with regional and government representatives.

A total of US$10 million is being invested in the facility, which should

maker says locating its R&D centre near the Kunshan factory will enable it to more closely support the development of original equipment products.

“Cooper Tire will continue to invest and grow and China and we will further enhance our technical personnel and capabilities there,” stated Yurkovich.

“Moving the Asia-Pacific Technology Center to Kunshan accelerates this growth.” sg

ISO 9001:2008 certification for Magna Tyres Netherlands-headquartered OTR, industrial and truck tyre company Magna Tyres Group has been awarded ISO 9001:2008 certification for its quality management system. Official certification audits at the Magna Tyres headquarters in Waalwijk were completed in March 2013.

ISO 9001:2008 is a series of international standards and guidelines on quality management and quality assurance by the International Organization for Standardization (ISO). The certificate is only awarded to companies that can demonstrate their ability to consistently provide products and services that meet customer and applicable requirements, placing customer satisfaction as a key component of those requirements. Magna says being ISO 9001:2008 certified is the key to expanding the company’s presence in international markets. The certification was carried out by the independent certification body, TÜV Nord. sg

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TYRES & ACCESSORIES 5/2013

NEWS

www.ntda.co.uk

NTDA NT N TDA DA 220 2011 0111 11

It’s TAFF Awards Time!

A highlight of the NTDA Annual Dinner is the eagerly-awaited presentation of the Tyre & Fast Fit Awards and this year’s event is no exception.

RECOGNISING EXCELLENCE

Tyre Manufacturer, Wholesaler, Tyre and Aftermarket Supplier, Tyre Industry Advertising Campaign and the Environmental Award.

As last year, the speciality chemicals group Lanxess is partnering with the Association in sponsoring the Awards. At the 2012 Annual Dinner, Lanxess and the NTDA officially launched a new App, which allowed retailers to demonstrate to customers the savings – in both fuel and money – that can be made by fitting tyres with low rolling resistance. Said Director Richard Edy: “We are very pleased with the take up for viewings of the App since its launch and anything that gives the motorist a better understanding of the performance of their tyres is to be applauded.”

There are two other Awards which are not decided by customers’ votes, the Innovation Award and the Tyre Centre of the Year Award. For the former, suppliers are invited to nominate a product or service that they believe is truly innovative and a panel of experts will select the winner from a short list. The Tyre Centre of the Year Award gives members the chance to show off their commitment to customer service and all-round retail excellence. Companies are invited to nominate one of their centres – or for larger chains, one centre per NTDA region – to take part in a mystery shopping exercise.

But back to the TAFF Awards. The Association will be asking members for nominations this month, with the closing date being 31st May. Votes will be collected between June and mid-September and the Awards presented at the Annual Dinner on 16th October.

The categories are the same as in previous years;

As last year, the process will be carried out by leading market research company Encircle Marketing and overseen by the Aftermarket Supplier Group of the NTDA. Details of how to nominate your centre will be given in June, so, if you think your service offering is second to none, this will give you a chance to prove it!

Versatile All-Rounder to Speak at Annual Dinner The NTDA is delighted to announce that the speaker at the Association’s Annual Dinner will be comedian, writer and actor Hal Cruttenden.

Hal originally trained at the Central School of Speech and Drama before embarking on a career of stand-up and acting – on film he appeared in ‘Mrs Dalloway’ and ‘The Madness of King George’, while TV appearances include roles in ‘Shackleton’, ‘Eastenders’, ‘Kavanagh QC’ and many others.

His stand-up career includes sell-out shows at the Edinburgh Festival and London, as well as UK tours.

Internationally, Hal has performed stand-up in the US and Canada, India, all across Europe, the Middle East and China, Hong Kong and Singapore. Hal has also performed for the British Armed Forces in Cyprus and the Falkland Islands.

Recent TV comedy appearances include ‘Live at the Apollo’, ‘Michael McIntyre’s Comedy Roadshow’, the Royal Variety Performance, ‘John Bishop’s Only Joking’ and ‘The Rob Brydon Show’. Hal can also be heard frequently on Radio 5 Live and he is currently writing a sitcom (‘Hal’) which will air on Radio 4 next year.

To book tickets for the Annual Dinner or for further details please contact us on email: lynnesmith@ntda.co.uk or 08449 670707

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ANNUAL DINNER

& TAFF AWARDS PRESENTATION 2013 TAFF Awards in partnership with

DATE & VENUE: Wednesday 16th October 2013 The Hilton Metropole at the NEC Birmingham is justly rated as one of the best hotels in the Midlands and its purpose built banquet suite provides the perfect backdrop

EVERYONE IS WELCOME: The most prestigious event of the year and the key social event for the UK Tyre Industry. All are welcome, so join the Association members and all the ‘movers and shakers’ from the UK Tyre Industry to celebrate our 84th Annual Dinner.

Hal Cruttenden is one of the top comedians working in the UK today, as well as being a highly acclaimed writer and actor. He has toured the UK and regularly appears at top UK comedy clubs, as well as at the Edinburgh Festival.

TICKETS: Members: £95 or £90 each for group bookings of 10 or more Non-Members: £110 or £105 each for group bookings of 10 or more (All prices ex VAT)

To book tickets or for further details please contact us on email: lynnesmith@ntda.co.uk or 08449 670707 ACCOMMODATION: We have a limited number of rooms available at a discounted rate. To book online go to: http://www.hilton.com/en/hi/groups/personalized/B/ BHXMETW-GTYRE-20131016/index.jhtml?WT.mc_ id=POG or phone 0121 780 4242 and quote GTYRE

Hal Cruttenden

THE ENTERTAINMENT:

UK TYRE MARKET

New leader, same direction T&A meets Goodyear Dunlop managing director Erich Fric THE

Three to five years assignments are the norm

A mechanical engineer by profession, Erich Fric is a 57-year-old Dunlop and before that Robert Bosch veteran. He may be new to Goodyear Dunlop UK, but he’s not new to Britain. In fact Fric’s route into his latest position demonstrates that his earlier experience of working in the UK made something of an impression. At one point in a previous professional incarnation, Fric spent time working with diesel injection systems. And with British Leyland and other truck OEMs here in blighty as customers, this meant travel and residency in the UK. As it turns out the experience was so positive that when he heard of the opportunity of working in Britain again, he jumped at the chance.

But steering Goodyear Dunlop’s presence in the British Isles is somewhat different to his last couple of postings leading Goodyear Dunlop in Austria and the Nordic/Baltic markets. Almost a year into the job, he describes the UK tyres sector as “a big and dynamic market”, adding that the Birmingham-based is comprised of a “strong team wants to move forward” despite the obvious difficulties facing the tyre business in general. And what’s more, from his vantage point the company is already “going in that direction” and has “the potential for strong growth.”

But first the obvious question – how can a leading manufacturer maintain its position in a close-knit market such as the British Isles when the leadership changes as frequently as it has? Erich Fric is the fifth managing director at the company since 2004. His most recent predecessor, George Rietbergen, stayed less than three years and before moving on to a European vice presidency, like Mark Brickhill before him.

In answering, Fric flipped the question around: “Three to five year assignments are the norm….[and] Europe couldn’t have asked George Rietbergen to move on if the team left behind was not already strong for the structure to function effectively with leadership turnover having been what it has been. Another factor is the loyalty of the team which includes many who have stayed longer and in some cases career long service of 25 or so years. These veterans bring real stability and continuity with them.” Asked how long he was planning to stay, Fric answered directly without any hesitation: “I wouldn’t mind saying five years – if the team and company agree.”

After establishing that Fric doesn’t have any plans to move on at this point, the conversation moved onto the unique retail and wholesale flavour inherent in the UK market. “It’s a bit complicated compared to the Nordic markets,” Fric offered euphemistically referring to the vast number of brains distributed by the combination of a handful of large wholesalers and retailers plus a myriad of independent tyre dealers.

Elements of this can be found in other European markets but the combination can’t really be found within any other single market in Europe. Referring to the relatively unique role play by wholesalers in the UK, Fric obsevered: “Here they are real experts in logistics”. It seems his first goal with regard to the wholesale business is to establish relationships before furthering cooperation: “Once we have found commonality there is the opportunity for partnership. While product forecasting is hard in Nordic markets [for example] the logistic expertise of UK wholesalers helps a lot and this is one such opportunity.”

One might think that it is complex product lines like winter tyres that particularly require this kind of

LATEST IN A SUCCESSION OF LEADERS at Tyre Fort in Birmingham, Erich Fric brings with him an easy-going, but teutonic clarity into his (relatively) new role of Goodyear Dunlop UK managing director. Almost a year after news of the appointment was released, Tyres & Accessories visited the company headquarters in mid-April for the MD’s first published interview in his current role where he shared his views on the British tyre market and recent corporate criticism of the companies EMEA region.

Erich Fric joined Goodyear Dunlop UK almost a year ago and brought with him experience of leading Goodyear Dunlop operations in Austria and the Nordic market

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UK TYRE MARKET

cooperation, but according to Fric the winter market operation here is actually considerably easier than in Scandinavia and other heavy winter markets. In the Nordic markets the proliferation of stock keeping units (SKUs) is significantly more complicated because, although people might put it in the same box as Germany or Austria, there are probably double the winter product lines before summer and all-season tyres are even considered. Although virtually everyone fits winter tyres in the cold months, 50 per cent of these are studded, with another quarter produced with soft winter (or extreme winter) compounds, which offer comparable performance to studs for most Nordic drivers and with the rest driving on Western European winter tyres. And this is all in addition to the summer tyres present in the market.

Instead Fric’s enthusiasm towards cooperating with British wholesalers is because of their forecasting prowess and their ability to offer multi-drop services almost anywhere in the UK. Indeed the concept of doing three drop a day to tyre dealer on the outskirts of Norwich was both baffling and impressive to Fric.

Corporate finger pointing One of the dubious privileges of being a leader is that you have to face down criticism. So what does Erich Fric make of the fact that in recently financial results statement Goodyear Dunlop UK’s US-based head office has bemoaned the profitability of the company’s Europe Middle East and Africa (EMEA) region? While he admitted he cannot speak for the region as a whole (but rather the British Isles for which he is responsible) Fric did share his perspective in terms of the European tyre business in general and the UK market in particular.

While people may draw their own conclusions about the potential internal politics associated with discussions of finger pointing between different regions of a global company, it is also be worth pointing out that what might be numerically true for Europe, the Middle East and Africa as a whole may not be true for each individual region. And what may be true for Europe as a whole may not be true for the consti-

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tuent countries within the continent.

Indeed what is true for Europe (that its 2012 figures were somewhat underwhelming) doesn’t appear to be the case for the UK where 2012 full-year figures were up on 2011, which itself was good and has even been described as a “turnaround” year.

There are also said to be reasonable explanations for what has transpired. As we know from evidence in markets across Europe, dealers have learnt to keep inventories low and OE business has been significantly impacted by an overall lack of demand. Across Europe, winter tyre sales have been markedly down, but once again this is patently not the case in the UK. And even if it had’ve been, the size of this segment means its impact would have been much more limited that in large mainland European markets such as Germany.

However while these structural factors mean sales of bread and butter products have felt the effects of market conditions, Fric points out that the highest value UHP, RunOnFlat and 4x4 products have been outpacing the recovery of the market, meaning sales should be particularly good when the market as a whole recovers. This can be seen in the market shares of the Goodyear and Dunlop brands combined, which when taken as a pair put the manufacturer clearly ahead of its premium competitors. However, taken as individual brands the company’s two flag brands remain a few places off the pace.

In light of all this it is worth asking what impact the corporate criticism will have on EMEA plans. With the closing of Goodyear’s Amiens plant and the likes of Michelin openly considering its European capacity requirements, Pirelli delaying its industrial plan and Continental admitting ahead of publication that it will undershoot its first quarter financial targets, does this mean Goodyear Dunlop is considering any further production efficiencies in Birmingham or Wolverhampton? The simple answer is no. According to Fric, UK production capacities have already been pretty much optimised and these operations are set to stay as they are. Furthermore there are no specific plans for additional efficiencies (read cuts) across Europe at this time.

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Premiumisation With ERMC saying European sell-in was down double digits last year and was similarly poor in the first quarter of 2013; and with third party market researchers saying sell-out was half or less of that, industry figures are beginning to indicate that there is room for optimism. And while no-one is expecting an overnight turnaround, Fric counts himself amongst those that see the market’s decline as coming to an end.

Overall, he says it stabilise, but we can expect some degree of upswing in the passenger car and truck and bus sectors.

The relatively positive sell-out data combined with the UK’s almost uniquely positive new car registration figures are cited as the reasons for.

However, Fric understands that in order for Goodyear Dunlop to achieve its goals it cannot simply sit tight and wait for the market to recover. Instead the emphasis is on leveraging the company’s strengths through product innovation, OE, motorsport, tyre tests and education, marketing and promotions Here in the UK (as opposed to the Nordic and German/Austrian markers) a tyre is a real commodity. And for this reason Fric admits that the company must take the recent growth of upper mid-range challengers seriously.

Labelling is a help in the longer term and Goodyear Dunlop’s current European positioning is interesting in this respect (see “Goodyear aiming to lead in tyre labelling”, Tyres & Accessories April 2013 for more on this). But the emphasis needs to be on innovation: “When we come off the gas with this we lose momentum”. An advocate for winter tyre criteria when the labelling rules are revisited, Fric is also a supporter of labelling enforcement. But what does that mean in practice? Fric’s response was perhaps the clearest and most straightforward of the day, summing up the calm but clear approach of the managing director: “It means yes when it comes to offering know-how support and no when it comes to financial support.” A straight answer to a straight question. chris.anthony@tyrepress.com

TYRES & ACCESSORIES 5/2013

UK TYRE MARKET

UK’s fledgling winter tyre sector is growing Numbers fly in the face of claims of winter tyre market naysayers THE UK

has been taking deliberate steps to develop its fledgling winter tyre market for more almost a decade. Over the years improvements have accelerated with the passing of time. Now, new research produced by market analysts GfK suggest sales are accelerating faster than ever.

TYRE INDUSTRY

According to the analysts at GfK, the winter tyre market started selling in particularly developed volumes during the period between October 2010 and February 2011 when unit sales showed growth of over 85 per cent on the same period the previous year.

The following year sales grew again by over 70 per cent in terms unit volume.

According to GfK, this was “solely on the back of growth expectation as during October 2011to February 2012 as most of the country did not experience sustained cold weather or more particularly snow.”

Far from the nightmare of a winter season experienced by some of the arguably more developed winter tyre markets on the continent, the UK experienced sustained growth.

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However, that said – and this won’t come as a surprise to anyone – this seemingly unending growth is reported to have stalled during the last winter season (October 2012 to February 2013). This winter saw sales fall by around 30 per cent. However, GfK reports that these levels are still in excess of the very cold winter of Oct 2010 to Feb 2011, which was hailed as something of a winter tyre success.

How big is the winter sector in terms of volume?

Percentages are all well and good, but while helpful for getting a feel of which way the market is going, we also need a reference point if these numbers are to have any real value. So with this in mind, how big is the winter sector in terms of volume?

According to Kevin Glynn, Account Director, Auto at GfK, if we look only at sales from independent dealers we can gain an understanding of the relationship on average pricing between winter and summer tyres (not including fleet sales).

His view is that winter tyres are worth the effort to sell as on average they go for

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around 1.3 times the price of summer tyres.

Are there particular sizes that are particularly common? Again, if we ignore any anomalies caused by fleet sales tyre sizes in winter reportedly reflect the pattern we see in summer tyres with the UK’s perennial favourite size (205/55R16) being the best seller in a H speed rating.

Taking GfK’s sell-out data to together with ETRMA’s sell-in data for roughly the same period presents us with an interesting conflict. With ETRMA saying the European winter tyre market plummeted by about 20 per cent and GfK putting the decline in single digits there are two particularly plausible explanations. Firstly that the demand has been incredibly strong and this has been supplied by nonmanufacturers or that secondly dealers have got used to de-stocking inventories during these straightened times and spend last winter selling off the previous year’s stock. Of course the third option is some kind of combination of the two.

Perhaps there is increased demand and this is being fulfilled by whoever is offering the best deal, but perhaps we are seeing a de-stocking effect in action as well. chris.anthony@tyrepress.com

TYRES & ACCESSORIES 5/2013

Even more change from Evergreen Excellence in Value Evergreen Tyres are designed and manufactured to uncompromising standards. Premium quality no longer means premium price. And the result – with Evergreen, your customers will keep coming back. Another way that Evergreen is Changing Tyres.

The Evergreen Performance Centre package: – Customised work-wear – Tyre Life Guarantee – Volume incentives – Corporate hospitality – Depot signage and point-of-sale materials

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UK TYRE MARKET

Road safety glass ceiling?

Industry bodies working hard, but high numbers of drivers failing to carry out simple checks remain the norm THE TYRE INDUSTRY’S FOCUS on the safe use of On the evidence of more recently published inforits products continues to appear evergreen in its appeal. In key speeches towards the end of last year, both the NTDA and Tyre Wholesalers Group chairmen spoke of the dangers associated with part-worn tyres, while TyreSafe’s Tyre Safety Month addressed the issue to record high numbers of interested parties. However, TWG chair Ashley Croft posed a more fundamental question: “until we can educate the public and enforce existing tread depth laws how can we realistically expect our message on part-worns to be heard?”

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mation, it appears that the safety and economic reasons for avoiding part-worns will remain obscure to many drivers, since they simply fail to take on board the seriousness of proper tyre care. This occurs even when confronted with the increasing weight of information received through broadcasts such as The BBC’s One Show and at point of sale as a result of TyreSafe’s commendable campaigning. The organisation “reached new levels of…participation” in 2012, with 200,000 leaflets and posters distributed to those in the tyre industry, particularly to participating tyre retailers and workshops offering free tyre safety checks to car owners.

Chairman Stuart Jackson is justly proud that since 2006, it has contributed to achieving a reduction of

“Poor tyre maintenance accounts for billions of litres of wasted fuel and increased CO2 output of 9.2 million tonnes each year” – Bridgestone

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UK TYRE MARKET

38 per cent in the number of people killed or seriously injured in a tyre-related accident in the UK. Yet in Department for Transport figures between 2010 and 2011, this figure rose for the first time in this period. And the industry continues to report high numbers of illegal tyres at the point of removal.

‘Alarming’ Bridgestone data The seriousness of the state of European drivers’ tyres was the subject of 2012 information gathered by Bridgestone, during the manufacturer’s free tyre safety checks taken out across the continent and in the UK. The results, gathered during more than 28,000 free tyre safety checks provide grim reading, suggesting that tyre care and awareness has continued to deteriorate in the region. The most alarming change from data gathered in the same way in 2011 is an increase of 25 per cent in the number of tyres either underinflated or beyond the legal limit.

While the European Union has in place many strategies for making roads safer – it is a specified goal of the EU tyre label – Bridgestone’s data suggests that the most basic tyre checks remain beyond too many of the continent’s drivers.

Bridgestone says that 78 per cent of vehicles surveyed were found to have underinflated tyres while over a quarter had tyres that were worn beyond the legal limit. In 2011, Bridgestone found 63 and 20 per cent of motorists respectively were found to have underinflated and illegally worn tyres. The company speculates that the increase’s most likely causes are the economic crisis, rising fuel prices and declining purchasing power; the message that correct tyre maintenance in the long term increases the cost effectiveness of tyres in addition to their safety appears not to affect drivers’ views on short term maintenance or replacement costs.

Bridgestone estimates that poor tyre maintenance accounts for billions of litres of wasted fuel and increased CO2 output of 9.2 million tonnes each year.

Underinflated tyres not only wear out

TYRES & ACCESSORIES 5/2013

faster but are also responsible for an estimated 3.9 billion litres of wasted fuel per year, the manufacturer concludes.

Jake Rønsholt, general manager Corporate & Brand Communications, Bridgestone Europe explains: “Driving on underinflated tyres is not only dangerous.

It is an enormous waste of fuel and the cause of carbon emissions that could easily be avoided by simple, regular checks. Ideally, drivers should check their tyre pressure once a month. And while doing so, it is also a good idea to check tread depth and look out for damage or irregular wear at the same time.

“Some people tend to forget that driving on underinflated and/or worn tyres may considerably impact handling and braking… Many see tyres as only black and round, a necessity purchase, but we must always bear in mind that they are the only point of contact with the road, and the size of 4 postcards!”

Bridgestone says it plans to continue carrying out free tyre safety checks across Europe in 2013 in order to raise awareness on the importance of tyre maintenance and its impact on safety, the environment and driving costs. 2012’s figures represent the eighth consecutive edition of Bridgestone’s data collected in this way.

1.5 million ‘avoidable’ MOT failures The glass ceiling effect in increasing safety is not limited to tyres. The Society of Motor Manufacturers and Traders indicates in research published in April that around 1.5 million MOT failures each year could be avoided if motorists carry out simple visual checks of their vehicles and forewarn their dealer of issues, before the annual test of roadworthiness.

The findings are highlighted as part of the ‘Minute Or Two’ campaign, which encourages motorists to carry out 10 visual checks of their vehicle prior to the MOT test. The full ‘Minute Or Two’ checklist, which can be viewed at www.passmymot.co.uk, includes checks of headlights, tyres, windscreen wipers and fluid levels. The website also features a video guide to the checks and a Garage Finder

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tool, powered by Motor Codes, the car servicing customer service scheme backed by Trading Standards.

The campaign is backed by every major car maker, and technicians at 5,545 manufacturer main dealerships across the UK are ready and able to assist customers who might be unsure about carrying out the checks themselves. While this campaign is much more problematic than TyreSafe – it has been criticised and condemned by the Independent Garage Association as „a blatant attempt to drive business away from small garages“ – this is further evidence that, in spite of widespread publicity and the economic penalty of failing an MOT, many drivers remain too disengaged from caring for their vehicles.

NFDA director, Sue Robinson commented that the „scheme along with the assistance of their local manufacturer main dealer, could make a huge difference to MOT pass rates.“ Experience suggests that the difference it can make can only go so far.

With this in mind, it’s a good thing the plan to reduce the frequency of MOT tests – described by NTDA chairman Stephen Callow, an MOT inspector himself, as “ridiculous” – did not go ahead. In fact, the significant numbers of MOT failures and tyres illegal at the point of removal despite the large amount of road safety education organised by industry bodies, suggest that any reduction in legal enforcement is misguided. And it’s a fair argument to suggest that the Government needs to step up and provide more stick to go with these numerous educative carrots provided by TyreSafe and others.

Ashley Croft argued in 2012 that greater enforcement is necessary, but questioned how to redirect resources in “this era of budget cuts and caps”. His suggested method – embarrassing the Government into redeploying resources through local publicity – seems like a decent idea. akb/pg

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UK TYRE MARKET

Analysts: UK to become e-commerce capital of the world Frost and Sullivan offer 12 ‘mega trends that will shape Britain IN THE

81 per cent of the UK population will be living in urban areas. There will be 200 million connected devices and one in four British citizens will be shopping online – the highest number in the world, per capita.The over 65s will represent a fifth of the population. The country’s South East region will grow to become the second largest region after London, accounting for 15.3 per cent of total GDP. That’s all if Frost & Sullivan’s ‘New Mega Trends in the UK’ analysis, which looks forward to 2025, turns out to be correct. However, even if there are only half right the flavor of what might take place in the next year if of interest to all sectors of the industry.

FUTURE

In the report, which is being launched on 14 May, Frost & Sullivan details and analyses 12 New Mega Trends that will drive growth and innovation in the UK. „These are new areas of growth in key industries that will help economic development, boost private sector investment and promote partnerships with overseas companies,“ explains Frost & Sullivan Partner Sarwant Singh.

One of the most interesting and important Mega Trends in the UK will be Connectivity and Convergence. The UK will have 200 million connected devices (six for every household) by 2020 which means that the country is on the path to becoming a digital economy with new business models and digital innovation hubs. One of the major industries that has benefited from the proliferation of digital devices is retail. Retail in the UK is transitioning from brick and mortar supermarkets to virtual stores and online hypermarkets – merging both bricks and clicks.

The Bricks and Clicks Mega Trend is influencing most British retailers to transition from having a single/multiple channel to an integrated cross-channel model, merging physical and virtual forms of retailing. The report suggests the UK will have the largest online retail penetration in the world as 26 per cent of all retail sales will be online by 2025. Over 80 per cent of entertainment products will be sold online by 2025. New retailing business models in the UK have also opened up new commercial opportunities for allied industries such as logistics. As a result we are witnessing the introduction of innovative last mile options such as click and collect, addressing challenges associated with making urban deliveries, given the Mega Trend of Urbanization in Britain – all of which is relevant to the tyre business. Indeed it should be of particular interest for tyre retailers and e-tailers that

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have been trying to fuse “bricks and clicks” with varying degrees of success over the last decade.

The UK will follow the global pattern of cities – not countries – driving wealth creation in the future. As mentioned, around 81 per cent of the total population in UK will live in urban centres, say Frost & Sullivan. London accounted for 20 per cent of UK’s GDP in 2011 and could contribute about 25 per cent in 2020.

This rapid rate of urbanization will compel companies to target cities as their growth markets, with most UK cities also expected to become the micro manufacturing hubs or digital hubs of the country by 2025. Urbanization will also influence companies to become more rational and optimal in their operations, creating a new ‘smarter’ UK. Smart is the new green. This Mega Trend will see smart initiatives replacing green concepts in many parts of the UK. For example, smart technology will find its way into most homes, with nearly five million broadband homes expected to have at least one smart home system by 2017, generating £1 billion in digital revenues. Smart Mobility will save millions of pounds from reduced congestion as more door-to-door integrated mobility solutions are introduced. A key aspect of dispensing any smart initiative would centre on smart grids which are expected to increase energy efficiency by 30 percent. Nearly 43 million Smart Meters are expected to be installed in 30 million UK homes by 2019 generating £14 billion to Britain by 2020. Of course tyre labeling and green tyres in general neatly dovetail into this. But while the kinds of tyres we might see on electric vehicles have been prototyped, this area is very much still in development.

The study also reveals many Social Trends. For example, one out of five people in the UK will be aged over 65 by 2020. The 65+ group is expected to contribute £77 billion to the British economy by 2030 (from £42 billion in 2011), with spending power to increase to £130 billion in 2030 (£78 billion in 2011). Future opportunities from Social Trends include new services and solutions in Healthcare, and neighbourhoods for aging citizens with new technologies such as robotic care for the elderly. Health, Wellness and Wellbeing in fact would become a key Mega Trend for the UK as preventive care becomes more important and relevant to its aging society. The future of Healthcare will be focussed more on wellness and well-being that define mind, body and soul. This will create new opportunities in e-health, regenerative medicine, personalized medicine, health kiosks, tissue engineering, nutraceuticals, healthcare tourism, cybernetics, and noninvasive surgery. cja

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UK TYRE MARKET

Michelin offers farmers ‘tyres on tick’ FINANCING

IS NOW AVAILABLE for UK purchasers of Michelin agricultural tyres through the company’s new ‘Flexelagri’ credit scheme. The tyre maker says qualifying UK farmers and contractors looking to purchase Michelin agricultural drive or trailer tyres, or the rims required for its Ultraflex technology, will be able to spread the cost over two years at a 0 per cent finance rate. No deposit is required, however a £100 administration fee applies.

“We are the first agricultural tyre manufacturer to offer such a deal in the UK,” commented Mike Lawton, commercial director of Michelin’s Agriculture division. “Michelin tyres are a premium brand and the upfront cost can sometimes be daunting for customers, even though the quality of the product balanc- Michelin’s AxioBib and Ultraflex tyres are amongst the products available on credit es out the costs by delivering increased longevity matched by impressive performance in the field and use on tractors, CerexBib tyres for combine harvesters and on the road. This deal allows our customers the financial flexi- SprayBib tyres for self-propelled sprayers.

To take advantage of the Flexelagri payment plan, a single bility to spread the cost of their new tyres over 24 months.”

As mentioned, the promotion includes Michelin’s full range transaction must total at least £3,500, and not exceed £15,000. of agricultural drive and trailer tyres, including its patented Furthermore, all tyres must be purchased from one of Ultraflex technology tyres, which are designed to carry the Michelin’s participating Exelagri accredited dealers. The total same load at lower pressures, or heavier loads at the same amount will then be payable in 24 equal monthly direct debit pressure, compared with conventional agricultural tyres. The instalments. sg Ultraflex range includes Michelin’s AxioBib and XeoBib tyres for

Solstor looks to Vacu-Lug for carbon reduction KENT-BASED supply chain specialist, is also proving financially successful while

The Solstar fleet will be shod with Vacu-Lug’s literally green eco tyres

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Solstor UK Ltd has reported a reduction of almost 20 tonnes of carbon dioxide emissions since moving to a Vacu-Lug new and remould tyre policy for its tractor unit fleet and from a new-only policy to a Vacu-Lug remould policy on its trailer fleet last May. "Solstor is firmly committed to reducing its impact upon the environment, and we recognise the contribution being made in this respect to our operations by VacuLug," says Andy Hitchings, operations director for Solstor UK Limited.

"Furthermore, in addition to benefiting the environment, the switch in our tyre policy

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operational service levels are unaffected."

Since embarking upon its new tyre policies, more than 350 Vacu-Lug Duramold super-single tyres have been fitted to the Solstor trailer fleet, representing a saving of 54.2 kilogrammes of carbon dioxide emissions per tyre. This figure equates to the reduced amount of carbon dioxide emitted during the remould manufacturing process compared to that of a new tyre.

To emphasise the environmental benefits of its new tyre policies, a proportion of the Vacu-Lug Duramold remould tyres fit-

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UK TYRE MARKET

ted to the Solstor fleet are made from a green coloured compound developed by Vacu-Lug. This compound has a lower rolling resistance than regular tyres and therefore contributes further towards carbon reduction.

The green tyres have been manufactured using a specially-formulated compound which replaces the traditional carbon black with a mix of silicas, resulting in a low-rolling resistance product which provides operational and environmental benefits.

Independent trials conducted by TARCC (Tun Abdul Razak Research Centre, the UK-based research arm of the Malaysian Rubber Board) report that the tyres are more environmentally-efficient in a number of ways. Firstly the silica-based compound is harder and tougher than a standard tyre, meaning there is less deformation in the crown area, which significantly improves the tyres' rolling resistance by up to 30 per cent.

In addition the tread surface of the high-silica compound is harder and microscopically rougher than regular carbon black-based compound and, as a result, increases surface grip.

Less movement in the tread means there is less heat build-up, thereby prolonging tyre life. The harder compound theoretically improves the wear characteristics of the tyre over a period of time. The silica-based compound shows a much improved snow and ice behaviour and better wet skid properties, with abrasion remaining constant.

Solstor UK Limited is part of the AG Thames Group. In addition to its Crayford Head Office site, the company has depots in Peterborough, and Boston, as well as operations in Spain, Italy and Poland providing a pan-European, end-to-end solution.

The firm's double-shifted fleet of 80 tractor units and 160 trailers is involved in the distribution of fresh and chilled produce to many leading UK supermarket retailers. cja

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UK’s ‘most puncture-prone fleet’ appoints ATS-E A 173 vehicle fleet thought to be amongst the most likely to sustain tyre damage has appointed ATS Euromaster to help maintain its tyres.

Oxfordshire-based ChevronTraffic Management is the UK’s largest independent traffic management company and claims to operate in one of the most demanding environments for road-based vehicles in the UK. Chevron runs 4x4 pick-ups, vans and trucks completing daily tasks on debris-strewn motorway hard shoulders.

Fleet manager Alan Flynn says the company’s tyre bill is the second highest vehicle running cost after fuel, and at least one vehicle suffers a puncture every day – and often many more: “The risk of punctures and irreparable sidewall damage is our biggest problem. Every tyre in the fleet ends up being replaced due to damage; well before the tread depth reaches the legal limit or we have a chance to regroove.”

Chevron has six depots across the UK and previously sourced its tyres via the Independent Tyre Distributors Network. Flynn says increasingly high charges for roadside callouts and lack of adherence to its specified budget tyre policy forced Chevron to consider different suppliers.

“We chose to put ATS-E to the test based on the strength of its nationwide coverage and 24/7 mobile support. This gives us access to the largest mobile tyre fitting fleet in the country, which helps ensure fast response times for roadside callouts – even in the middle of the night, which is our busiest time.”

ATS-E’s roadside call-out charges follow an agreed national pricing structure and the company is committed to adhering to the customer’s budget tyre policy, with a range of budget brands stocked nationwide. Flynn adds: “This should mean an end to fitters arriving at a breakdown with expensive premium-brand tyres. We’ve trialled premium fitments before, but they aren’t a viable option given the nature of our work.

“On occasions where we have been forced down this route at the roadside it’s been an unnecessary cost for the business to swallow. It’s why we are ringing the changes – ATS Euromaster is fully geared up to fit the tyres we specify.”

For routine tyre replacements, Chevron Traffic Management utilises a stock of spare wheel and tyre assemblies. Local ATS-E centres collect any spare rims twice a week and fit new budget tyres, before returning the completed assemblies to Chevron’s workshops for fitment. The tyre servicing company undertakes monthly tyre safety inspections at each of the company’s six depots, designed to help reduce instances of tyre-related breakdowns and support the fleet’s commitment to good tyre husbandry.

Chevron undertakes all types of temporary traffic management, including lane closures, contraflows, narrow lane systems and mobile lane closures, working in support of the Highways Agency and major infrastructure development companies. It recently worked on the widening of the M25 between Enfield and the QE2 Bridge, which utilised more than 40,000 traffic cones.

In addition to its 4x4 pick-ups and vans, the truck fleet ranges from Mitsubishi Canter chassis cabs mounted with dropside bodies for cone carrying, to a flagship fleet of 18 tonne Mercedes-Benz Axor, DAF CF 65 and Eurocargo Impact Protection Vehicles (IPVs). The IPVs feature a hydraulically-operated crash cushion for protecting teams working on the roadside and a rear facing Vertical Lift Light Arrow Board. akb

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RETAIL

The re-volving retail market What a changing market environment means for tyre retailers Roughly half of the 30 million-odd tyres sold to UK motorists each year are delivered through tyre specialists, a figure that is broadly comparable with figures across Europe. And while there are some noteworthy differences between the structure of the UK tyre market and mainland Europe in general, perhaps the most interesting details are to be found within this 50 per cent. That’s why in this month’s retail chains/buying groups feature Tyres & Accessories considers the state and make-up of the sell-out market and releases the details of latest top 20 tyre retail chains survey. As well as our own research we consider data compiled and analysed by four well-known third-party research firms, however for commercial and confidentiality reasons we aren’t citing the sources individually each time they are mentioned. Instead this year’s retail report analyses their input and presents our view of the consensus.

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Recent years have seen the British tyre market put under considerable pressure. The combination of reduced disposable incomes (due to the wider economic situation), lower miles driven (down to the combination of the credit crunch) and sky-high fuel costs have pushed consumers to run their tyres for as long as ever (often past the legal limit) and in 10 per cent or more of cases to purchase part-worn tyres (some figures put annual UK part-worn sales as high as circa 5 million units, while others hold 4 million). Either way, all this has had a significant impact on new tyre demand, which has inevitably been felt by retailers themselves. However, while Europool figures report that European sell-in was down double digits last year, and was similarly poor in the first quarter of 2013 (a trend that is broadly similar in the UK), While the impact of the recession has been felt all-round, retail has shown other market researchers report that UK new tyre sell-out more resilience than other parts of the tyre market. This year’s retail report looks at the reasons the behind this and the outlook for the future. was roughly half as bad. On the one hand you could view Nevertheless, market research agencies put the retail marthis as reason for optimism, as a sign that the market is stabilising prior to recovery and the sell-in discrepancy was due to de- ket’s four-year (2007-2011) compound annual growth rate stocking. On the other hand you could say it is a testament to (CAGR) at between -2.4 per cent and -5.3 per cent, meaning the entrepreneurship of the retail business, which has kept the the market has significantly contracted during the period, tyre business afloat in what have been undoubtedly challenging whichever way you look at it. Having said all that, again like a diesel engine, once it gets going the UK market has one of the times. best outlooks in Europe. Between 2011 and 2016 UK tyre sales A stuttering diesel-engine tyre retail environment What we are left with is a diverse core of specialised busi- are expected to record CAGR of between one per cent and 4.5 nesses that represent a variety of different businesses per cent, depending on which report you are reading. To put this approaches and the complete range of sizes. Around them the into perspective, the same reports suggest other leading matumarket context has been stalling and stuttering like an old die- re markets such as Germany and France are going be flat or sel engine. This, according to some figures, means that the 30- decline during the period.

De-segmentation and selling power odd million unit average annual car tyre sales figure could be But how have retailers managed to keep sales going in considerably less now. Different sources offer massively different opinions on this, but the consensus appears to be that 2011 spite of the adverse conditions? There are likely to be many diswas something of a low water mark with demand falling up to parate reasons for this, but for the purposes of this article let’s 11.5 per cent, the worst performance of all the major markets just look at two linked points - the selling power of retailers and in Europe. However, one report suggests the previous year de-segmentation.

It is well-known within the industry that the most important (2010) was the strongest growth witnessed in the region, increasing 12.5 per cent. Therefore we have to read the drop in influencer when it comes to consumer tyre buying is the retailer themselves. But why is this? As one market research firm light of the fact that it came off a high base.

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RETAIL

UK replacement market segmentation

UK tyre replacement market segmentation Q4 2011 Q4 2012 said, in a recent report on the UK passenger car tyre market in genMid Budget Premium Mid eral, the presence of large numbers 42.6% 20.9% 41.9% 22% of small customers in this market can often imply low buyer power, since the effect of any individual decision to buy or not to buy has negligible impact on revenues for market players. Switching costs in this market are low with little cost to the individual consumer when swapping their loyalty to another garage. Or in other words, there is Premium Budget lots of competition and it costs not35.4% 37.2% hing to go to another depot. And it has to be said that with a large chunk of consumers now pre- Change: Premium: 5.4 Mid: 1.1 Budget: 6.7 researching their tyre purchases Note: Includes all passenger fitments online this is only likely to increase.

Tyres & Accessories 5/2013 However, dealers can and do play Source: Third party market research on the cost sensitivity of consumers and differentiate themselves on price. And before labelling Looking forward there was no way for consumers to objectively compare products apart from magazine tests. Owing to the fact that maga- If you seek a prediction as to what is up ahead, there are some zine tests are by definition limited in their scope, the retailer is indications that the worst is over and therefore we may see also the tyre expert and therefore the voice of the reason in the some improvement in the status quo by the end of the year. consumer conversation. As a result, buyer power isn’t over - One such indicator is the fact that the general UK retail outlook whelming – when people need tyres they need tyres, even in a is improving, along with increases in tax allowances and falling recession. But – as we have seen – it is certainly a moderate fuel prices. and some would say increasing influence in the market place.

For the first time in two and a half years the general UK The second means of maintaining sales in the midst of turmoil retail performance has improved. However, unless something linked to this. changes the second quarter of 2013 is set to “flat line”, accordAs the saying goes, a bird in the hand is worth two in the ing to the Retail Think Tank. Following its quarterly meeting in bush – even more so in a recession. So when a consumer April, the KPMG/Ipsos Retail Think Tank (RTT) reported that the enters a depot, selling tyres – any tyres – is better than not sell- downward trajectory that has plagued UK retail since the start ing tyres, even if the product sold isn’t a direct match for the of 2011 finally turned around in quarter one of 2013, although a premium OE tyre fitted to the customer’s car. As a result, there significant increase in the health of UK retailing is unlikely to appears to have been a real tendency towards selling more arrive any time soon. The RTT’s Retail Health Index improved competitively priced (and many would argue increasingly com- one point to 77 points, thanks to a marginal lift in demand, petitively performing) non-premium tyres. This is the so-called which would have been better still had it not been for the prode-segmentation phenomenon that we have become so famili- longed extension of wintry weather throughout the whole quarar with. The latest research suggests that the age-old 40:20:40 ter.

Premium:Mid-range:Budget segmentation of the market has The RTT agreed that overall Christmas trading figures had now gone (see chart “UK tyre replacement market segment- been relatively good, and that there were very few new casualation”). While this model has been roughly in place for some ties coming through now – the consequence of better run busitime, others (who presumably had different definitions of bud- nesses and an uplift in demand. Details about the different get) have suggested the trend toward budget is more marked sectors are perhaps irrelevant to those of us interested in the than this, and therefore the latest data T&A has come across tyre business and automotive parts in general. However, what offers confirmation of its reality. they do offer is an insight into consumer confidence. For examWhat is perhaps surprising is where the swing is coming ple, while the food sector was something of a star performer, from. Broadly speaking, the swing is from Premium to Budget food margins remained broadly flat. And extra discounting was rather than from Mid-range to Budget as you might expect, necessary to stimulate clothing sales in particular, and some with some sixth sevenths of the roughly seven percentage major players remained heavily promotional led in the quarter point swing headed in this direction. (notably Debenhams and M&S). The logic is that if people are

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European car and van replacement tyres European car and van replacement tyres distribution full-year 2011 distribution channels full-year channels 2011 Independent garages 13.7% Tyre specialists 50.4

Other 15.4%

Vehicle manufacturer networks 20.5% (1) Autocentres reportedly represent 8.2%

UK car and van replacement tyres distribution tyres channels full-year 2011 full-year 2011 UK car and van replacement distribution channels Independent garages 10.9% Vehicle manufacturer networks 12.8%

Tyre specialists 50

Other 26.3% Source: Third party data, T& A research

Tyres & Accessories 5/2013

scrimping on clothes they won’t necessarily have disposable income to spend on tyres. But once again, because of the unique type of product context tyres are sold in, what it may mean in practice is that rather than fewer tyres being sold it will mean the fight will really be over which tyres are sold. And again the fact that retail outlook is improving in general may suggest that people will spend a bit more on tyres.

However, the broad retail situation remains “very mixed” and the RTT report suggests confidence is likely to remain weak because “the recent employment growth is expected to tail off, inflation is on the increase again, and with fuel and energy prices set to rise.” However, looking more optimistically, there is some support for increased spending based namely recent changes in income tax thresholds and better flowing lending. Commenting, David McCorquodale, head of retail, KPMG UK, said: “Overall the quarter was quite an even one for UK retailers as demand, margins and costs all remained relatively static and it looks like we’re at the bottom of the decline.”

Vicky Redwood, chief UK economist at Capital Economics, added: "It’s a mixed picture. We have seen more employment growth during the quarter, mainly part-time jobs and individuals setting up their own companies. Also, more people are looking for work as they come off benefits or come out of education.

Consumers are more inclined to spend because it has become

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easier to borrow and at the moment there is less incentive to save. However, employment growth is tailing off a bit, incomes will again be squeezed in the coming months so nothing is certain. Everything is stacked against the consumer, but they keep on spending.”

Then there is the effect falling fuel prices are likely to have on miles driven and therefore tyre consumption. According to the AA, pump prices have dropped substantially following a fall in the price of oil and the wholesale price of petrol and diesel.

As a result there is now said to be potential for the UK’s average pump price of petrol to fall to 134pence per litre (ppl) in two to three weeks. This means unleaded prices have fallen by 3.0ppl from 139.9ppl to 136.9ppl and diesel prices even more so, down 4.6ppl from 146.4ppl to 141.8ppl. All this means a) more pennies to spend on tyres when motorists need to, which will b) be more often because as prices lower miles driven and thus tyre usage tends to increase, speeding up market throughput. So while quarter one delivered some very welcome results, whether we see any increase in demand the next quarter is open to discussion. Or in other words there are some positive signs, but especially in the tyre industry it is too early to say. What is even less clear is what effect this will have on the segmentation of the UK market as and when such effects kick in. chris.anthony@tyrepress.com

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Not just a fast-fit market In the UK tyres are retailed through a complex web of large chains and smaller independent dealers With half of all tyres sold through tyre specialists, this is clearly the most influential route to market for tyre suppliers. Within this segment the balance of power is divided between a relatively small number of nationally influential retail chains and large numbers of smaller operators. In fact, according to the Tyre Industry Federation Factbook 85 per cent of tyre specialists operate from a single outlet. At the same time we have all been dealing with the financial effects of general economic upheaval. All this makes insights into the ebb and flow of the tyre retail sector all the more valuable.

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Looking at the 2013 data we can see – broadly speaking – that the dominance of the largest tyre retail chains is softening slightly. Kwik-Fit and the other Itochuowned tyre retail brands remain dominant, but with their total branch count rounding off at 791 five branches down on last year.

This and indeed the general trend could be seen as something of a self correction of the market following Itochu’s Kwik-Fit acquisition in 2011 and the resultant bringing together of a number of different retail brands under one umbrella.

Meanwhile branch attrition (or seen in another light “right-sizing”) can also be seen at ATS Euromaster. Here the pattern is much more pronounced. While the branch count is down 11 to 358 branches this year, which is the most in our survey of the top 20, this actually means the retailer has 124 less points of sale than four years ago. Or, to put it another way, it has lost almost enough dots on a map to make another HiQ network. However it has to be said that ATS Euromaster would frame this as a continuing part of efforts to rationalise nation positioning and increase mobile fitting coverage.

National Tyres & Autocare remains static in fourth place on 225 branches. Like the other 10 networks in the top 20, considering the economic environment, it could be argued that this speaks of stability.

While it lost nine branches since last time we totted them up, HiQ remains in fourth place with 131 dots on the map. With this in mind it is worth pointing out that this

TYRES & ACCESSORIES 5/2013

factors, whether individually or in combination, could have also put some potential franchisees off. Indeed such points also address the lack of growth in the top 20 in general.

Why tyre retail With HiQ holding fourth, this rounds off the quartet of truly national retailers with the Speaking to company representative they next two nearest (fifth and sixth placed, conceded that the franchise network hasn’t Protyre and McConechy’s respectively) grown as quickly as the ambitious goals some 90 branches behind. However, it must published at its inception envisaged, but also be said that HiQ (the smallest of the the company is said to have initiated top four) is four times further from the top changes to address this. Externally it appe- spot, some 660 depots behind pole positiars as if take-up of HiQ franchise opportuni- on. This diversity between the top four ties has been dominated by a relatively demonstrates the distribution of retail distrismall number of franchise holders each bution amongst our top 20, which is thereholding multiple branches, with the rest fore no unrepresentative of the market as a supplemented by franchisees with one or whole. The one thing our top 20 can never two branches. The potential criticism, from show however is the influence of the many some quarters at least, is that this has one branch tyre shops that are all over the resulted in larger players having too much country.

One reason for the relative lack of moveof a say. Be that as it may (or may not be) Tyres & Accessories understands that the ment in over half of the top 20 is the barriers franchise approach is being modified, with to entry, many of which apply whether a busichanges centring on making it more attract- ness is established or not – especially at this ive to independent tyre dealerships by time. Tyre retail capital outlay remains high as adopting a more pay as you go approach – it includes employing staff and building or what some might call a softer franchising securing garage premises. Brand awareness and location remain of key importance. This approach.

What these points don’t address how- benefits large businesses and can lead small ever, is that during the period of the initial entrepreneurs to build their own local or franchise offer the market has been affect- regional brands, partner with other like-mined by both macro-economic conditions (a ded operations in a retail network-cumdouble dip recession) and significant struc- buying group or partner with whichever tural change (Itochu’s Kwik-Fit buy-out, the manufacturer(s) are deemed to be offering growth of Point S and the establishment of the best package. Often it is a combination of Profile Tyrecenter) in the UK. Both these these approaches.

is nine branches less than last year and 16 down on four years ago. And this nine branch swing is actually the second largest we saw in this year’s survey.

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Then there are the technological costs.

It not just tyre irons and jacks now its automatic test lanes, wheel alignment, diagnostics and TPMS equipment as well as

point of sale systems. And this is not to mention training which is seen as a key investment by many in the industry.

Companies also have to comply with

employment, health and safety, labelling and environmental laws, which – whether large or small - can deter new entrants into chris.anthony@tyrepress.com. the market.

Top 20 UK tyre retail chains 2013 by branches Firm Itochu retail

2008/2009 670

1)

2010/2011

2011/2012

676

2012/2013

Change

791

(-5)

796

ATS Euromaster

482

369

369

358

(-11)

National Tyres & Autocare

214

207

225

225

0

HiQ

147

150

140

131

(-9)

34

53

53

46

(-7)

52

52

49

45

(-4)

29

35

41

40

(-1)

Bathwick Tyres

28

32

32

32

0

Mr Tyre

24

25

25

25

0

2)

Protyre (Micheldever)

3)

McConechy's Tyre Service Malvern Tyres

4)

5)

Merityre

19

21

22

22

0

Exhaust Tyres & Batteries (ETB)

20

20

21

21

0

Bush Tyres

15

17

17

17

0

Kingsway Tyres

17

17

17

16

(-1)

Farmer Autocare

13

16

16

16

0

Selecta Tyre

14

14

15

16

(+1)

Watling Tyre Service

16

16

16

16

0

Universal Tyres

18

18

15

14

(-1)

County Tyre Group

15

14

13

13

0

Dexel

13

13

12

12

0

Lodge Tyre

8

9

11

11

0

1848

1774

1905

1867

(-35)

6)

Total:

Sources: Company information; T&A Research; NTDA Including any former Stapleton's branches Central, STS, TyrePros etc.

NTDA handbook says 131. HiQ reports 140 with 16 more coming on-stream in 2012.

3) Correct according press release issued April 2012.

4) NTDA handbook puts this figure at 46.

5) Includes King David Tyres, Malvern Tyres, HiQ and Auto Tyre & Battery Co., Ltd branded depots.

6) NTDA handbook reports 14.

1) 2)

Just missed out Eden Tyre1)

6

7

8

10

(+2)

1867

(-35)

Tied for 21st with Kings Road Tyres, which remained static at 10 branches.

1)

Top 20 branch count change 2011/2012 - 2012/2013 Top 20 total:

1905

(+131)

Sources:T&A Research; NTDA

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Booking ahead essential for optimal tyre service It seems being spoiled for choice may also spoil our chances of receiving the tyre service we want, when we want it. Michelin’s head of Fleet, Dave Crinson, opines that a wholesale shift in the way drivers view tyre appointments needs to occur due to the number of tyres now available on the market. This diversity means drivers who arrive unannounced at fast-fit suppliers may end up with a second or third choice tyre, or may be required to return at a later date.

At Michelin alone, a combination of tyre technology developments and wider variety of vehicle models requiring a greater range of load and speed ratings has led to the number of Michelin car and van tyre fitments doubling to 800 in the last decade.

This includes an additional 275 cold weather tyre lines.

Crinson says the UK fleet industry can learn lessons from Europe, where company car drivers are used to booking tyre appointments in advance as a matter of course. “In this country we are fortunate enough to have a wide choice in the items we buy – from computers to furniture or even cars. And in the majority of cases, if people want a specific or unique item they know not to expect to walk into a store and instantly get what they want,” he said. “It’s the same with services. No one expects to get an appointment with a doctor or dentist immediately unless it’s an emergency, and drivers would always expect to book ahead for an MOT or vehicle service.

It is my firm belief that people need to start thinking of tyres in this way.

“It’s unrealistic to think that every tyre dealer will have every single tyre line in stock at all times and for fleets there are consequences in terms of the fulfilment of tyre policies,” Crinson added. “Unless drivers give advance warning, they jeopardise their chan-

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TYRES & ACCESSORIES 5/2013

The large number of individual sizes available makes it hard for fast-fitters to stock every possible option

ces of getting their first choice tyre. Of course there will be times when drivers need emergency assistance if a tyre is damaged or punctured, but for general replacements people should plan ahead and book appointments.”

Michelin reports the most popular tyre for fleet and retail customers at the moment as being 205/55 R 16 – a size where it has ten derivatives plus vehicle manufacturer-specific fitments.

Kwik-Fit’s fleet sales director, Peter Lambert, agrees with Crinson, recommending customers phone ahead: “We have 800 centres and stock between 1,200 and 1,500 tyres per centre, but gone are the days where you can turn up at a centre and almost guarantee they will have the specific tyre you need. We always have the most popular sizes in stock, however if your vehicle’s tyre size is less common or you want a specific brand, that’s when it is a good idea to phone in advance.

“Some people do phone in advance; today it’s predominantly retail customers,” Lambert continued. “We would encourage all customers – retail and fleet – who have busy schedules and want to minimise time spent in the centre to phone first, check we have their tyres in stock and identify a good time for them to come in and have them fitted.”

At ATS Euromaster, the team is looking to

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set up an online booking system for tyre appointments for the leasing industry. “We are currently working on a project to offer lease vehicle customers the ability to book a tyre fitting appointment in our centres online,” commented group sales director Peter Fairlie. “It is still early days, but we hope to add this to our range of available services later this year.

“Our colleagues at Euromaster in Holland and France already offer e-bookings and the take-up from drivers is high. In Holland alone, they receive in the region of 150,000 online bookings every year,” Fairlie added. “Being able to offer pre-booked appointments is about making the process hassle free for customers, and ensuring we are always ready with the right quantity, brand, size and speed rating of tyres, in the right location, at the right time.”

To help fleet drivers plan ahead, Michelin has developed an online tool that tracks tyre wear and predicts when replacement tyres will be needed. Tyre Manager can be found at www.mymichelin.co.uk/tyremanager. “This tool could be particularly useful for fleets as it will help them budget more effectively and plan ahead for maintenance work,” said Dave Crinson. “That could mean unexpected and lengthy disruptions will be avoided, which is important sg for any business.”

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“Independent garages offer better value“ poll shows According to recent information released by the Independent Garage Association (IGA), cash-strapped motorists will be delighted to hear that visiting an independent garage could cost them on average £40 an hour less than if they visited a franchise dealer.The IGA polled over 2000 of its members on their labour rates and has concluded, that independent garages ‘continue to offer motorists the very best value for money.’ Enabling all UK motorists to find a ‘trusted’ local independent garage was one of the key reasons why the IGA launched its UK-wide Trust My Garage scheme.

Figures from the poll show that the average labour cost is slightly over £40 for independent garages, the lowest being £32 in Northern Ireland and the highest being £48 in the south and south east. In contrast, the most recent Warranty Direct annual Labour Rates survey demonstrates that average labour rates for franchise garages stand at a national average of £95.94 with some franchised dealers charging a hefty £55.94 an hour more than independents.

F

Location plays a part From over 2000 garage respondents, only two independent garages in the UK were charging a fee close to £90 per hour with the vast majority charging less than £50 per hour. Location also plays a part in the figures and when reviewing labour rates by county, the five lowest prices were recorded as £34 in Cambridgeshire, £35 in

Herefordshire, £36 in Staffordshire and Leicestershire and £37 in Cumbria. The five highest labour rates by county were recorded in London, Surrey, Buckinghamshire, Berkshire, Hertfordshire and Kent but all these garages still recorded average labour figures below £60.

Stuart James, Director of the RMI’s Independent Garage Association commented: “With the costs associated with owning a vehicle continually rising, it is fantastic to see that independent garages are continuing to offer motorists outstanding value for money.

“We set up Trust My Garage with the motorist in mind, to ensure that consumers were continually receiving the very best levels of technical and customer service from their local independent garage at a very effective price. The results from this survey prove that independent garages offer the most cost effective deal to motorists and we will continue to work with consumers through Trust My Garage to pg ensure that it remains this way.“

Halfords: Trust most important factor in garage choice While many of us may have thought that price is the most important determining factor when it is time to visit a garage, the latest research from Halfords Autocentres suggests it is actually more about trust.The study among UK motorists found that, despite fuel and insurance prices driving up the cost of motoring, the vast majority of owners (62 per cent) value trust above all else.

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An ability to trust the integrity of a garage to deliver against their promises is significantly more important than a convenient location – which was ranked the second most influential factor by 36 per cent of drivers – relegating price to third with 32 per cent.

Rory Carlin from Halfords Autocentres said: “There’s no easy way of establishing trust, it is earned and maintained in a wide variety of ways over time. From the efficiency of our booking in process and the expertise of our technicians, to the quality of workmanship, parts and backing of minimum 12 month warranty - we establish trust by offering access to a reputable brand that delivers main dealer quality at a more affordable price.”

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Trust is almost equally important to both men (63 per cent) and women (61 per cent). However, age is a factor in determining buying behaviour - with the proportion of drivers citing trust as their primary influence increasing the older they are.

Of those drivers aged over 65, 66 per cent placed trust number one, followed by 63 per cent of 35-44 year olds and 62 per cent of 55-64 year olds. However, only 35 per cent of drivers aged 18-24 said trust plays a part in their decision making - suggesting that experience plays a role in how highly trust is valued.

The study found there to be good reason why trust has become so important with over half (51 per cent) of respondents reporting instances of work being recommended for routine work such as an annual MOT that they felt was unnecessary at some point.

Rory Carlin added: “Trust is a vital commodity that is hard earned and can be eroded all too easily. We go to great lengths to eliminate the jargon used by mechanics when speaking to motorists and constantly evaluate our overall performance using an online customer experience survey, which ultimately enables us to build even greater trust in our service and our brand.” cja

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Are after-sale services going online?

Even though car service portals are being accepted only hesitantly, they still have a remarkable effect already today and the online booking of auto-services is beginning to enter the imagination of motorists across Europe. According to German research firm Wolk Aftersales, the concept has now “become imaginable” to many car drivers and the finding forms the basis for a new study named “After Sales Goes Online“ , conducted by the automotive consultancy.

W

What’s interesting for the wider tyre and fast fit business is that these car service portals do not only offer new possibilities to car drivers, but also to industry, garages and parts wholesalers. German auto centre chains appear to have dominated the research. But, as far as out-and-out tyre businesses are concerned, it is interested to note that Delticom and Tyre24 tied with 10 per cent of those questioned recognising these sites.

Wolk’s view is that the further the online service market develops, the further does its transparency. According to the study this does not only hold true for pricing policy, but also for the rating of the quality of parts and services offered by these garages, the type of garage, their appointment availability, and their location.

Car drivers’ general online expenditures to rise by 11 per cent The study is based on the responses of a total of 1,062 car drivers questioned in August 2012. The car drivers, which are responsible for the maintenance of their vehicles, were questioned with regard to their future-use of car service online

TYRES & ACCESSORIES 5/2013

portals, their preferential booking methods, and the most important criteria when it comes to selecting a workshop. The results underline the strong growth potential of car service market places in the internet. According to the study, today, internet-oriented car drivers spend an average of 830 euros per year for products and services (not only automotive) and almost two working days per week on the world wide web.

In the future, this online spending is expected to rise by 11 per cent. Furthermore the study shows that 35 per cent collect information on service range and qualification of workshops from the internet already today.

Another central result of the research is that 60 to 70 per cent of the interviewed car drivers can imagine booking car services online in the nearer future.

Wolk has a team of 40 specialists and, as a company, offers 30 years of experience in this field. The firm focuses on car service, car parts, tyres, car glass, chemicals and equipment. cja

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COMPANY NEWS

Pirelli names 2013 Supplier Awards winners Chief purchasing officer talks to T&A WITH PIRELLI GROUP spending around 4 billion euros acquiring goods and services in 2012, you can understand why the company wants to invest in its long term relationships and honour its best suppliers.That’s why Pirelli named the winners of its 2013 Supplier Awards on 10 April. According to the company, the awards are offered in recognition of the suppliers who have “contributed in a significant way to Pirelli’s Premium strategy throughout the world.”

T

This year’s awards were given to nine international companies – of which five were from the Asia-Pacific region – chosen by Pirelli on the basis of seven criteria: sustainability, quality, level of service, speed, innovation, as well as cost and global presence. According to the tyre manufacturer, the “quality” of the companies which supply goods and services is an essential factor in the pursuit of Pirelli’s premium strategy.

At present there are about 12,000 companies around the world that work with Pirelli, they are managed by 135 purchasing specialists and chosen on the basis of parameters indicated by Pirelli in the areas of safety, capacity for innovation, quality of materials, sustainability, level of risk, and efficiency of supply chain, with an analysis that does not only look at them directly, but also at the suppliers of the suppliers, through a selfappraisement by the contractor. Tyres & Accessories spoke with Luigi Staccoli, Pirelli’s chief purchasing officer (CPO), to find out more.

First, Luigi Staccoli offered his appraisal of the awards event itself: “It was a very successful presentation of the awards with an event demonstrating the performance of Pirelli products running in parallel.” The parallel event is said to have offered representatives of the winning suppliers the opportunity to drive some of the most exciting vehicles available, such as the Ferrari California and

34

Luigi Staccoli, Pirelli’s chief purchasing officer Lamborghini Galliardo, on a test track near . And why not? “The companies which won the award are those seen as being above the level of mere conformity, transforming themselves into true partners in quality and innovation,” Staccoli explained, adding: “and so also achieving a competitive advantage on international markets”.

With this in mind, T&A asked what kind of a difference leading suppliers make when it comes to the production of premium and UHP products. According to Staccoli it makes all the difference: “You can only make premium products from premium suppliers.” And for this reason Pirelli has what are described as

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“very strict assessment processes made by a cross-functional team.”

Of course there are differences in the approach taken by companies such as Pirelli and that taken by the even larger premium manufacturers, such as Michelin and Bridgestone. In this case the advantages of size are clear, but Pirelli doesn’t need relationships with every supplier – says Staccoli – but rather with the right suppliers. In order to be the right partner in Pirelli’s eyes, suppliers have to go through a procedure not dissimilar to the OE homologation process that Pirelli itself has to pass in order to enter relationships with some of the world’s leading car manufacturers. This

TYRES & ACCESSORIES 5/2013

COMPANY NEWS

means research and development questions, safety audits, supply consistency assessments, risk assessments as well as laboratory, factory and tyre tests before volume trials. All in all the procedure can last over a year. According to Staccoli, this means it is very difficult to get on board and rather easier to get off.

Some suppliers – and perhaps we are referring to Pirelli’s rubber and carbon black requirements here – are described as being “the Pirellis of their industries”, demonstrating a mutual respect which only serves to strengthen relationships.

However, the fact that Pirelli is not buying in the quantities of some other manufacturers means it is at some degree at a disadvantage as far as economies of scale are concerned. “Price is only one parameter,” Staccoli countered. What is important is the overall value supplier partners create for Pirelli. And to this end total cost of ownership is becoming more important than simple costs per se. In addition, Pirelli appears to be able to sidestep the disadvantage of its size relative to the top one or two by offering suppliers a bigger piece of their pie – so to speak. But isn’t there an inherent risk with such a strategy? And isn’t this an issue associated with commodities in general?

Staccoli acknowledged the fact that while there will always be risks, the object is to negate risks wherever possible. This is done by virtue of some hedging, either directly or through suppliers.

In addition, risk can be insulated through joint activities with suppliers such as improving efficiencies and offering support with know-how and the supply chain.

In a further demonstration of this process, Pirelli’s award winning suppliers are said to be exhibiting a trend towards creating tailor-made products and sharing expertise with customers like Pirelli. This results in original and patentable technology, which helps premium firms like the Italian tyre maker continue to differentiate its products despite the enormous proliferation of brands available on the market. This is especially said to be the case in Pirelli’s area of speciality – top end tyres for high performance markets.

TYRES & ACCESSORIES 5/2013

Getting greener The company is also increasingly verifying levels of green materials in its sourcing processes. Materials already used include versalis, guayule, rice husk ash

agricultural tyre production business in . In Michelin’s case the plans are more wideranging, with truck tyre output seen as closest to the chop.

However, while Staccoli said he didn’t have a great deal to add on the subject

SUPPLIER AWARD 2013 WINNERS Company

Country

Activity

Area

Asahi Corporation Evonik Industries JHSi Kiswire Synthos Von Bundit SAE HWA SAP HH Global

Japan Germany China Korea Poland Thailand Korea Germany Italy

Synthetic rubber Silane and silica Silane Beadwire Synthetic rubber Synthetic rubber Moulds, machinery IT solutions Printing

Raw materials Raw materials Raw materials Raw materials Raw materials Raw materials Components Services Services

Source: Pirelli and recycled rubber in new tyres. And the company’s suppliers are also said to be working towards offering increasingly “green” components in the ingredients they provide. Nevertheless, while the proportion of green materials is increasing this still represents a relatively small part of Pirelli’s overall purchasing spend.

Currently green materials represent around eight per cent of this budget. But when you compare this to the situation just five years ago – when virtually nothing bearing such characteristics were sourced – this is clearly a vast improvement.

Corporate restructuring?

In what was either great politeness or something of an understatement, Staccoli characterised the current tyre volume slump in as meaning the market is “not exactly booming”. However, he also pointed out that the premium sector in which Pirelli specialises is growing. Nevertheless, premium competitors Goodyear and Michelin have both recently either made restructuring efforts or announced their plans to reduce European tyre production capacity in a bid to better match output with demand. In Goodyear’s case this means closing the plant and exiting the

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following Pirelli’s decision to delay publication of its industrial plan, he did say that this may mean covering the output requirements of fast growing regions with products manufactured in relatively underutilised European factories. This is of course in contrast in what some may have expected – namely reducing or closing European production in favour of Eastern European, South American or Asian production.

While not suggesting the two subjects are linked, Staccoli also observed that the global spread of the company’s supply chain is moving east, a trend that has become increasingly noticeable in the last five or so years. However, with production facilities on every continent, Pirelli is said to be “pretty well balanced” and has a supplier in every major region too. In this respect Pirelli does not subscribe to a local for local policy, instead looking to leverage global value. And value is described as the balance of quality with price, deliverability and risk. The increasing quality of Asian suppliers (a number of which are honoured in this year’s suppliers awards) is of particular importance, with quality standards having significantly increased over the years – especially since around 2007. And this trend doesn’t show any signs of abating. chris.anthony@tyrepress.com

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COMPANY NEWS

Premium manufacturers review European supply/demand balance WITH GOODYEAR closing its Amiens off-road tyre plant earlier in the year and with Michelin and Pirelli both pointing to slow market demand as reason to reassess their production positions, it looks like change in the Western European manufacturing positioning of the premium players is in a state of flux.

In its most recent report on market trends, Pirelli’s figures showed car and light commercial vehicle volumes in Europe to be down 13 per cent year-todate in the OE segment and 10 per cent in the replacement business. While separate information for premium tyres was not given, on 5 April Pirelli stated that in response to the economic crisis in Europe and its impact on demand for premium tyres, it is “carrying out a significant review of its commercial structures” in the European market.

The Italian tyre maker says this review entails, among other things, more closely integrating its high-end tyre production capacity in Europe with those markets where demand for premium products in highest. These markets are presumably

I Pirelli’s presence on several big-name Geneva launches, such as the LaFerrari, comes at a time when premium sales in Europe are taking a hit

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the US and rapidly developing markets – areas where Pirelli says demand is growing approximately three times faster than overall global demand for passenger car tyres.

Pirelli doesn’t precisely set out what it has in mind regarding integrating capacity with demand, and although an industry source told Reuters (“Pirelli studying plan to offset weakening European demand”, published 7 April) that the company intends to ship European-produced premium tyres to markets where demand is growing and absorb the extra transport costs through lower margins, the same Reuters article shared comments made by a second person familiar with the matter, who is reported as saying “Pirelli had no plans to cut production or close factories outside of Europe.” This comment, by means of deduction, leaves the option of cutting production or closing plants within Europe completely open.

But as we have seen, Pirelli is not the only tyre maker to re-evaluate its European business. As Tyrepress.com reported on 26 March, French newspaper Les Echos quoted Michelin’s passenger car and light truck products division director Florent Menegaux as saying the tyre maker “does not exclude anything” in its response to recent market evolution. He added that Michelin is

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COMPANY NEWS

Plan presentation. This was originally scheduled for 8 May but will now take place in November. “The decision was taken to provide better visibility on the context of reference and enable the preparation of coherent medium-to-long term forecasts, taking into account that the macro-economic and business context in which Pirelli operates is in significant and continuous evolution, more markedly so in recent times,” stated the Italian manufacturer. It added that its 2013 targets, announced on 11 March, remain unchanged.

Michelin. In response to questioning about low plant utilisation in Europe, Michelin CFO Marc Henry told participants in the company’s first quarter 2013 earnings call that the tyre maker will consider its options in the coming months.

Michelin’s European passenger car plants are currently running at 75 to 80 per cent of capacity and its truck plants at 65 to 70 per cent, he shared.

While this might be seen as bad news, Henry pointed out that the company’s first quarter results are the best it has ever achieved with such volumes.

“So that means that there is no difficulty, financially speaking. But of course there Michelin European plant utilisation is no point to stay very long with 65 per under scrutiny cent to 70 per cent of utilisation in truck As T&A reported last month, a similar in Europe. So that’s certainly something period of reflection is taking place at that we will consider during our strategic exercise that is being done between April until July this year.”

In its latest market trends update, Michelin reports that European on-road Summing up its first quarter 2013 experience in a single sentence, Michelin states tyre markets were mostly down in that in the three months to 31 March the “market environment was weak in March. Original equipment and replaceEurope in passenger car and light truck tyres, disappointing in North America and ment market passenger car tyre sales in expanding in the new markets.”

Europe (including the Turkish and growing Total net sales for the quarter came to 4.877 billion euros, 8.1 per cent lower Russian markets) were respectively than in the first quarter of 2012. Net sales from passenger and light truck tyres down 15 and 11 per cent year-on-year (and their related distribution) were 2.582 billion, down 6.5 per cent year-on-year, during March 2013. The year to date decliwhile sales volumes retreated by 2.8 per cent as gains in the new markets failed ne is 11 per cent for original equipment to fully offset the fall-off in mature markets. The price-mix effect reflected the careand nine per cent for the replacement fully managed price repositionings and the favorable mix effect, led by the 17-inch market. and larger segment. Truck tyre (and related distribution) net sales amounted to Original equipment heavy truck radial 1.477 billion euros, 7.9 per cent less than a year earlier, while sales volumes, which sales in Europe (Turkey and Russia incluwere down 5.6 per cent year-on-year but showed a slight upturn quarter-on-quarded) decreased four per cent year-on-year ter, reflected the focus on turning around the truck tyre business and restoring it in March, while replacement sales were to profit. Specialty business net sales, at 818 million euros, were 13.0 per cent up three per cent. Year to date, original down year-on-year, this decline primarily reflected the 6.9 per cent fall-off in voluequipment heavy truck radial sales are mes caused by weaker demand in the infrastructure and the OE Earthmover and down three per cent while the replaceagricultural segments, as well as the early-year contractual price adjustments in ment market has increased five per cent the mining segment and the OE business. year-on-year. sg/cja Michelin observes that its volume performance reflected two fewer business days in the quarter, a difference in market trends between the mature and growth regions, and a decline in original equipment demand, notably in the earthmover segment. Volume performance also reflected a negative price-mix, due to the impact of indexation clauses as raw materials costs decline and carefully managed price repositioning, targeted on certain tyre sizes. sg

experiencing overcapacity in Europe, and it appears the French manufacturer met with union representatives in early March to discuss the future of factories in its homeland. Earlier in the year, analysts at Deutsche Bank also named Goodyear as a company considered likely to restructure its EMEA region business during 2013. Indeed, upon releasing its fourth quarter 2012 results (which contained poor EMEA sales), Goodyear said it was taking further steps to “return its business to historical margin levels” within EMEA. In January, the tyre maker committed itself to exiting the agricultural business within the region.

Pirelli’s comments on reviewing its European commercial structures were made in the context of the announced postponement of its 2013-2017 Industrial

Michelin Q1 sales down 8.1%

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COMPANY NEWS

Nokian 1Q sales down 13%, operating profit down 20% Finnish manufacturer defends Russian approach DESPITE

SIGNIFICANT DROPS in first quarter sales and profitability, Nokian used the publication of its latest financial results as an opportunity to rebuff negativity relating to its exposure to the Russian market.

In the first quarter of 2013 Nokian Tyres Group’s net sales decreased by 13.3 per cent to 333.1 million euros (1Q 2012: 384.3 million euros).

Operating profit fell even more sharply, dropping 27 per cent to 76.3 million (1Q 2012: 105 million euros).

to grow. But sales in Nordic countries and Central Europe are expected to be flat as well.

All this adds up to some 2013 “growth in net sales and operating profit compared to 2012” although on the back of the first quarter results, first half net sales and operating profit are still going to be weaker than in 2012. The danger for Nokian is that the less than spectacular results gives ground for the company to be more reliant on its Russia strategy, but with Bridgestone (itself a 15 per cent shareholder in Nokian) announcing plans for its own Russian factory during the first quarter, this is a strategy that has come under intense scrutiny. The answer? A restatement of the Russian strategy in the present market context from Nokian presiProduction capacity in 2013: 18 million tyres Potential to increase output by 50% by 2014 dent and CEO, Kim Gran: “Our strong market leader position in the core markets in Russia and Nordic countries is intact and helped us to book reasonable first quarter results. Headwind was heavy with the European economy, car sales and replacement tyre market demand being clearly down. We do not foresee any major improvement in the market for 2013 but target to grow and excel on the back of our renewed winter tyre range, expanding distribution and our strong industrial structure.

“In the first quarter our strongest card was,

also presented the case that demand for replacement car tyres in 2013 will be on previous year’s level in Nordic countries even if it does remain weak in Europe. In Russia, demand is estimated to show growth in winter tyres but be flat for summer tyres. And while company representatives concede that the 2013 pricing environment is challenging across all segments, Nokian’s strategy will reportedly be supported by easing of raw material costs (€/kg) by approximately six per cent in 2013. But this doesn’t fix the demand problem. And to this end Nokian admitted sales are expected to show “flat to some The tyre manufacturer blamed historically growth during 2013.” Sales in Russia and low levels of tyre demand in Europe, but North America are, however, expected

PRODUCTION PLANTS

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COMPANY NEWS

FINANCIAL PERFORMANCE 1-3/2013 Gross sales by market area

the beginning of 2013, which increased the public awareness throughout Europe on tyres and winter safety.

First quarter miss

once again, Russia. A significant increase in winter tyre sales and market share brought us most of our profits. We expect the good performance to continue with our new winter tyres spearheaded

by Hakkapeliitta 8 coming on stream from the second quarter onwards. The Russian tyre market is growing modestly in 2013 but offer still further growth opportunities in replacement winter tyres. The Central European market was as bad as expected in the first quarter with a clear drop in demand. Sales in all Europe suffered from a prolonged winter, which for both Nokian and Vianor caused most of the consumer summer tyre sales and profit to shift to the second quarter.”

Russia ‘still going strong’ Despite questions from market analysts following the Bridgestone announcement, Nokian has maintained its position in relation to the Russian market. The company’s thesis is that GDP growth in the first quarter was approximately one per cent in Russia with full year growth estimated at 2.7 per cent. And while this is nothing to write home about taken in isolation, compared with Nordic countries, where full year 2013 GDP growth is estimated to be one per cent and large parts of Europe that remain in recession

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or close to it, this is a good prospect.

The argument is supported by external signs of improvement such as new car sales. In the first quarter of 2013 Russian new car sales totalled 616,700 units, the same level as the comparable period last year. However, while new car sales are estimated to be flat in the first half of 2013, Nokian expects the stagnation to turn to growth in the second half with full-year sales of 3.1 million, up 2-5 per cent versus 2012. As a result of this and growing consumer confidence, 2013 demand for tyres is expected to exceed 40 million units and to grow 2-5 per cent, with the majority of growth being generated by winter tyre sales. Russia tyre pricing has reportedly remained stable across all segments. Compare this with Europe where in the first quarter of 2013 new cars sales dropped by 9.8 per cent and replacement car tyre sales decreased 13 per cent (although the UK is notable exception here), with winter tyre sellin tumbling 33 per cent.

The signs are said to be even clearer in the Russian truck tyre segment. In Europe demand for premium truck tyres was down one per cent and it was down 17 per cent in the Nordic countries but in Russia demand increased by 25 per cent.

At the same time, new truck winter tyre legislation in Sweden came into effect in

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While Nokian focused its efforts on stating the case for Russia, financial analysts were somewhat more sceptical, with Morgan Stanley for example asking if the first quarter 2013 results were “prelude to a year of falling consensus?” The analysts’ conclusions appear to have been coloured by the fact that the drops in Nokian’s first quarter sales and profitability meant the firm missed consensus expectations by nine per cent. Drops of 5 per cent had been expected, but the reality was closer to triple this. Pre-tax profits (EBIT) were described as “relatively more resilient” inasmuch as they were just seven per cent lighter than consensus, but the rancour could have stemmed from the fact that they were a 20 per cent first quarter miss compared with Morgan Stanley’s own estimates.

On the subject of Russia, the analysts’ line was that there are still questions to ask about Russian pricing and answers needed about why the decent Russian car markets didn’t help Nokian to deliver any surprises in its first quarter financials. So, while Nokian is pointing to Russia as its saving grace and while the Russian and CIS consolidated sales grew 3.2 per cent, the fact that they formed 51.8 per cent (1Q 2013: 44 per cent) of the group’s total sales could also be seen as the company’s Achilles heel. And with the goal to increase production output 50 per cent by 2014, discerning which way it will go is central to the company’s future success. chris.anthony@tyrepress.com

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COMPANY NEWS

Falling cost of sea freight is good news for tyre trade IT’S

– the UK has avoided entering into a triple-dip recession. Figures published by the Office for National Statistics show that, following the 0.3 per cent contraction that was witnessed in the last three months of 2012, the UK economy expanded by 0.3 per cent in the opening quarter of this year.

At the start of May, Rob Shelley, founder of Suffolk-based freight forwarding specialist Maritime Cargo Services, spoke withTyres & Accessories about this development and other issues influencing the cost of shipping tyres across the ocean.

GRIs are at their lowest point in over a year

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OFFICIAL

Quite how this first quarter growth will impact the tyre industry in 2013 has yet to be played out.

“With regard to the UK’s ongoing economic struggles, I think we can all be forgiven for grasping the smallest chink of light at the end of a very long, dark tunnel,” Shelley comments. “So the news that the threat of a triple-dip recession is over, at least for the time being, has almost put a spring-like step into the shoes of many business analysts.

Indeed, economists from Goldman Sachs are forecasting that the second of the two recessions Britain experienced after the 2008 crash is likely to be revised away in due course, suggesting the UK’s post-crash performance has been less dismal than previously believed.”

Shelley also notes that the cost

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of moving tyres and wheels between Asia and major European markets such as the UK continues to vary on a shipment by shipment basis. In terms of tyre transportation to the UK, the biggest cost comes from the General Rate Increases (GRI’s), namely the adjustment of sea freight charges by shipping companies. “This rate fluctuates all the time; for a 40’ container it can cost anything from US$1000 to over $5000,” he shares. “However, at the time of going to press it was $1750 for base ports, which is lower than it has been for over a year.” Plans were afoot to increase this; Shelley points out that most shipping lines intended to bring in a GRI increase of around US$500 per 20’ container in April, following similar sized upward adjustments levied in mid-March; “however, due to delivery of enormous new vessels with more on the way and stagnant growth in the container market, they simply lost their nerve. This is bad news for the carriers, but good if you’re shipping tyres and wheels to the UK.”

Other cost factors Another variable that tyre importers must contend with is the cost of quay rent and demurrage. Quay rent is the charge made when containers are not taken off quay on time, therefore incurring costs to the port for a parking space (quay rent): “The knock on effect of this is that there is then a further charge from the shipping line for overdue rental of the container (demurrage). This is quite often the elephant in the room adding, sometimes, considerable and unexpected costs.”

Finally, the scrapping in March of September’s planned 3p fuel duty increase has obviously been welcomed by freight forwarding agents such as Maritime Cargo Services. “This is good news for tyre wholesalers as it will have a knock on effect, both on the transportation costs of importing containers, and on distribution costs,” Shelley observes. “Our trade association, the British International Freight Association, has long been pressing the Government to eliminate rises for the rest of this parliament, and we are hopeful that this latest fillip is a sign that there won’t be any more increases.” sg

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COMPANY NEWS

KKR confirms Alliance Tire Group purchase KOHLBERG KRAVIS ROBERT (commonly known as KKR) has confirmed reports that it is acquiring a controlling stake in Alliance Tire Group (ATG) from an affiliate of Warburg Pincus. KKR also confirmed that Yogesh Mahansaria, founder of ATG, will continue to maintain an ownership stake in the company and partner with KKR to continue to grow the business. Terms of the transaction were not disclosed and so details of current shareholdings and therefore the balance of power are not yet clear. As usual, the transaction is subject to customary closing conditions, including receipt of regulatory and third-party consents.

“We would be delighted to have KKR as our new incoming partner. Our team is impressed by KKR’s franchise and its strong track record. KKR’s investment will enable us to continue to expand into new markets, make strategic acquisitions, and help scale our global presence” said Yogesh Mahansaria.

“We would also like to thank Warburg Pincus for its support during the past six years as it helped create and build ATG into the global industry leader that it is today.”

“ATG is a leader in an attractive industry with strong underlying growth drivers. We are thrilled to be partnered with Yogesh and his management team and look forward to leveraging our global network to support their continued growth,” said Sanjay Nayar, Member of KKR and Head of KKR India.

“From funding the initial acquisition of Israel-based Alliance Tire Company to the development of a global player in the off-highway tyre sector, our partnership with Yogesh and the entire ATG management team has been an extremely successful one. We are confident that ATG’s success will continue with its new partners,” said Vishal Mahadevia,

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managing director and co-head of Warburg Pincus India.

Report: KKR buying 90% of Alliance Tire Group While details have not been officially confirmed, India’s Economic Times reports that private equity firm Kohlberg Kravis Roberts (KKR) has agreed to buy a 90 per cent stake in Alliance Tire Group. The deal, for a reported US$650 million, includes an estimated $125 million in debt.

The news suggests brings speculation of such a sale, to a company such as KKR – which has been seen as the front runner for some time – to a conclusion.

However both the size and the value of the purchase may come as a surprise to some. With the new owner once again being private equity and therefore midterm return driven it is also likely to raise questions about the tyre company’s medium term strategy.

The report said that Warburg Pincus bought an 80 per cent stake in the thenHadera, Israel-based Alliance Tire Co. in 2007 for some $150 million.

Mahansaria, former CEO of Balkrishna Tyres, bought the remaining 20 per cent, and assumed operational management of the company.

Under the new deal with KKR, the report said, Warburg Pincus is selling its entire stake, while Mahansaria will sell half of his stake to KKR. What is clear is that KKR’s investment in ATG is being made through its investment funds and will be supported by a financing tranche led by Crescent Mezzanine with additional participation by the Ivy High Income Fund. Credit Suisse served as the financial advisor to ATG and Nine Rivers Capital advised the Founders. Barclays Bank PLC and JP Morgan served as advisors to KKR for this transaction. cja

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Trelleborg Q1 results show effect of weaker market IN ITS INTERIM report covering January – March 2013, Sweden’s Trelleborg “noted a strong first quarter despite weaker market conditions”, or in other words, its figures are down on a year earlier but show a respectable performance given the current market. The company anticipates its performance in the second quarter will be on a par with the first quarter.

Net sales for the first quarter of 2013 declined 5.8 per cent to SEK 5.4 billion (£533.1 million); organic sales decreased by five per cent. Operating profit for the quarter, excluding items affecting comparability and the participation in TrelleborgVibracoustic, declined 4.1 per cent to SEK 639 million (£63.2 million), equivalent to an operating margin of 11.8 per cent, up from 11.6 per cent a year earlier. Net profit amounted to SEK 491 million (£48.5 million), a year-on-year decrease of 2.0 per cent.

The business area of interest to us is of course Trelleborg Wheel Systems.

Sales here amounted to SEK 1.1 billion (£109.6 million), a decrease of 1.7 per cent on the first quarter of 2012.

Operating profit fell 7.7 per cent to SEK 144 million (£14.2 million) and operating margin decreased from 13.8 per cent to 13.0 per cent. “Adjusted for acquisitions and exchange-rate effects, organic sales declined by seven per cent,” the company states. “Sales of tyres fitted on materials handling vehicles in Europe declined significantly compared with the corresponding period in 2012. Sales of agricultural tyres fell slightly less and performed in line with the underlying market. The quarter was the second best to date in terms of agricultural tyres, despite a substantially weaker market climate.”

The impact of lower sales on Trelleborg Wheel Systems’ operating profit was in part offset by reduced costs excluding exchange-rate effects. sg

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Ian Veitch is new FTA president STEWART OADES has handed over the presidency of the Freight Transport Association to Ian Veitch, Managing Director of Yusen Logistics UK, following FTA’s National Council meeting in London on 23 April.

Stewart Oades steps down after completing a four year term as FTA President.

After studying biology at University in Leicester, Veitch spent 15 years at British Road Services, which ultimately became Exel Logistics, followed by two years as a director at Christian Salvesen Distribution before joining NYK in 1994 as managing director of subsidiary company UCI Logistics. He became chief executive of NYK’s merged UK logistics businesses in 2005 and in 2007 was appointed to the Board of Corporate Officers of NYK Group in Japan, the first European to do so.

His responsibilities increased and diversified in 2011 with the merger of Yusen Air & Sea and NYK Logistics, forming the new Yusen Logistics UK. He has been a member of the FTA Board since 2008 and is a Fellow of the Chartered Institute of Logistics and Transport.

Stewart Oades said: “It has been an enormous privilege to have been President of FTA for the last four years. My thanks to the FTA leadership and staff, fellow Board members and the enthusiastic regional committees who have made it a very enjoyable experience. My best wishes go to Ian Veitch, who I know has all the necessary skills to ensure FTA continues its excellent work on behalf of our membership.“ Ian Veitch commented: “Stewart leaves behind him an outstanding legacy within FTA for which I am deeply indebted to him. I am looking forward to working with my Board colleagues and the Executive team in pursuing the best interests of our members and promoting our industry as a vital part of our society and our economy.“ pg

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Peter Allen (l) takes over from Ian Stuart on 1 June

ATS Euromaster names new group MD IAN STUART is to retire at the end of May 2013 after seven years as group managing director of ATS Euromaster, the UK’s largest comprehensive tyre specialist. He will be replaced by Peter Allen, who is currently commercial director of Michelin Canada.

After joining Euromaster in 1993, Stuart spent three years as managing director of WS Tyremasters, at the time one of the UK’s largest tyre wholesalers, followed by three years as a regional director in France. He then became managing director of Euromaster in North Europe with responsibility for Holland and the Nordic countries prior to the appointment in his current role in Birmingham.

During the last three years, he has overseen a £14 million investment in the ATS Euromaster network, modernising facilities and extending the company’s expertise into new areas of service, maintenance and repair. At the same time, he has reinforced the company’s position as the country’s largest commercial vehicle tyre specialist.

Stuart now plans to pursue a number of consultancy projects both within and outside the tyre industry. Commenting on his successor, Stuart says: “With more than 30 years in the tyre industry, Peter’s wealth of knowledge and expertise makes him ideally suited to lead ATS Euromaster into the next phase of its development.”

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Peter Allen, 50, was originally from the UK and will join the company in early May; he takes over as group managing director on 1 June 2013. His career in the tyre industry began in the early 1980s at Ebley Tyre Services, after which he emigrated to the USA in 1984, joining Goodyear as a retail management trainee at a company-owned store in South Carolina. After returning to the UK for four years, he then joined Michelin in 1990 as commercial territory sales representative in Georgia, USA. He went on to hold several sales and marketing positions in the USA, before taking on the role of product line manager (Oceania) in 1999. After two years in Australia, he returned to the USA in 2001 as director sales planning, before being promoted into roles including general business director and distribution development manager. Allen left the USA for Canada in 2008, where he has been in his current post for five years – including two terms as Chairman of the Rubber Association of Canada.

Commenting on his move to ATS Euromaster, Allen says: “I have been fortunate to have lived and worked in three beautiful overseas countries, yet as someone who was born in Cambridge and went to school in the Cotswolds, I am looking forward to an exciting new opportunity back home.” pg

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Noji named new Yokohama North America boss YOKOHAMA RUBBER has announced Nagumo,

chairman

and

CEO

of

three personnel changes that took Yokohama Rubber. “And we are confident that this vital market will be served most effect on 1 May.

Hikomitsu Noji has been appointed CEO of the tyre maker’s US operation, Yokohama Tire Corporation, and CEO of Yokohama Corporation of North America.

Noji retains the title of president and representative director of parent company Yokohama Rubber. Noji is expected to travel to the United States regularly in his new role but will remain based at Yokohama Rubber’s headquarters in Tokyo.

Yasushi Tanaka, who was previously CEO of Yokohama Tire Corporation, CEO of Yokohama Corporation of America and CEO of Yokohama Corporation of North America, will begin on 1 May as assistant to the president of Yokohama’s Tire Business Group. In his new capacity, Tanaka will oversee Yokohama Rubber’s global plans on new plant constructions as well as expansions on existing plants.

Takayuki Hamaya will be in charge of Yokohama Tire Corporation’s day-to-day operations including strategy development, corporate planning and driving Yokohama Tire Corporation’s business performance. Hamaya will retain his title of chief operating officer.

“Yokohama is fully committed to investing resources in the North American marketplace,” said Tadanobu

effectively with the key management structure we have put in place.”

Three further promotions within Yokohama Tire Corporation took place on 1 April.

Fred Koplin’s role of director, marketing communications was supersized to that of senior director, consumer sales, while Rick Phillips has been promoted from director, commercial sales to senior director, commercial and OTR sales. Tim Easter, director, OTR sales and marketing, reports to Phillips.

Andrew Briggs, previously director, product planning and motorsports, is now director, marketing communications and product planning. Briggs’ responsibilities include marketing communications, consumer and commercial product planning. He will also continue to oversee motorsports. Lawrence Kull has been promoted from national sales manager, consumer division to director, tyre business planning. Kull will oversee consumer and commercial sales planning, market analysis, sales strategy development and business performance measurement. He will continue as the national account manager for Discount Tire.

Koplin, Phillips, Briggs and Kull all report to Hamaya. “Yokohama has aggressive growth goals,” the chief operating officer commented. “And the only

Hikomitsu Noji

way to achieve those is to keep growing our dealers’ business the way we have been. Our customers remain our top priority and we are confident that the sales management structure we have assembled makes us an even more effective business partner to them. We look forward to a mutually strong profitable future together.”

After a career with Yokohama Tire Corporation spanning almost 25 years, Dan King, senior vice-president of sales and marketing, left the company of 5 April. King has taken on the position of president at California-based wholesaler Tire’s Warehouse. sg

SEMA appoints Spagnola as vice president SEMA has appointed Mike Spagnola into the newly created position of vice president, OEM and product development programs. The move, which is effective immediately, see Spagnola bring with him 40 years of specialty auto parts experience, including more than 20 years of product development and project vehicle work.

“We’re excited to have Mike join SEMA in developing services that help members with product development and OEM initiatives,” said Chris Kersting, SEMA president and CEO. “SEMA’s vehicle technology and

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OEM programs, led by John Waraniak and Bill Wolf, have proven to be extremely beneficial over the years.

Mike will work with our existing team to enhance and add to the services SEMA makes available to our members.”

Spagnola’s track record includes retail, distrib-ution and manufacturing experience. Most recently, he served as president for Street Scene Equipment where he managed the company’s day-to-day business for 16 years. cja

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Project2_Page 47 07/05/2013 17:36 Page 1

Heuver names new marketing manager

D

Dutch wholesaler Heuver Tyrewholesale has appointed Dewy Mulder its new marketing manager. She succeeds Maureen Voortman in this role following Voortman’s promotion within the company. In her new role, Mulder takes on marketing responsibility for both Heuver’s wholesale business and the company’s Profile Tyrecenter retail outlets.

Heuver Tyrewholesale’s plan for the coming year involves more intensive customer contact. Marketing, communication and a focus on the customer are all areas where Heuver wished to make a difference. “In order to be successful, we must also optimise our internal set-up,” comments director Bertus Heuver. “That is why we have fine-tuned our organisation. One of the main principles is more

intensive customer contact, via specific country teams And Maureen Voortman will play an important role in this. On the other hand, we also want to undertake external initiatives; for the wholesale branch and for our Profile Tyrecenters.

With Dewy Mulder as our new marketing manager, we will be able to give both these areas our full attention. Dewy will offer us versatile marketing knowledge in the field of B2B and B2C. This will help us to take the next step in terms of visibility and representation, at regional, national and international level.”

“Heuver’s aim of placing greater emphasis on customer focus was one of the reasons why I accepted my new position. “That, and the fact that Heuver is establishing a strong CSR policy and is a warm and transparent family business

with short lines of communication. My new role comes with many challenges, but I will first build on things that have been successful in the past. The combination between international wholesale and regional Profile Tyrecenters adds a great deal of variety to the role. And that is where my B2B and B2C knowledge will be very useful. In the coming months, I want to meet as many people as possible and identify new opportunities to make Heuver more effective than ever.”

Mulder studied international marketing and strategic management & corporate development in Sweden, specialising in sustainability and corporate social responsibility. Heuver says she will benefit the automotive sector with her extensive retail and FMCG experience. sg

Pirelli announces German management changes CHANGES TO THE MANAGEMENT structu- Kemper has taken over as head of the business unit, Business Development re of Pirelli Deutschland’s sales and marketing team took effect on 1 April.

Amongst these tweaks is an extension of Sascha Kemper’s area of responsibility. In addition to his current position as Germany-wide sales manager for the original equipment truck business and Northern Germany sales manager for the replacement market truck business,

replacement truck business in Southern Germany from Sascha Ihrig.

In his new role as key account manager for car dealerships, Sascha Ihrig has transferred over to Pirelli Deutschland’s car business area. Ihrig has been employed by Pirelli since 2002, when he was hired as a local sales manager.

Pirelli Deutschland has created a new

Truck, and placed Levent Elgün in charge.

In this capacity he will coordinate the acquisition of new customers and also support Alain Versace, marketing manager Truck - Central Europe, in coordinating the marketing of the Pirelli Cyber Fleet TMS system in the German market. Prior to taking on this position, Elgün was employed for three months as sales and marketing operation manager for Pirelli’s German truck business, and the recent graduate also completed an internship in the truck business during 2010 and 2011.

In their new roles, Sascha Kemper und Levent Elgün report directly to Manfred Zoni, who heads up the truck business at Pirelli Deutschland GmbH and is responsible for the German, Austrian, Swiss, Belgian and Dutch markets. sg

Sascha Kemper (l) and Levent Elgün

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“The fortunate isles“ Bauma 2013: OTR segment companies anticipate sound growth EVERY THREE YEARS BAUMA, the international trade fair for construction machinery, mining machinery, construction vehicles and equipment, takes place in the German city of Munich.

The show also serves as a focal point for tyre makers, wholesalers and equipment suppliers serving the off-road segment. And although many within Europe’s tyre industry are not experiencing the best of times at the moment, most Bauma exhibitors were nevertheless in very high spirits and saw themselves, as companies active within the OTR tyre sector, as an “island of the blessed” surrounded by a highly contrasting situation in the passenger car and truck tyre markets. Many exhibitors expressed hope of once again experiencing sound growth within their market segments in 2013, yet one thing was clear: Everyone in the market realises that, in the long-term, real growth will only take place outside of Europe.

Bridgestone’s eye-catcher: Weighing 5.2 tonnes and with an diameter of 4.02 metres, the 59/80R63 VRF is a Bauma highlight and is, according its manufacturer, the world’s largest OTR tyre

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It came as no surprise to find numerous global market leaders amongst the 3,420 Bauma exhibitors. This applied equally to the tyre makers present at the show – mostly, at least. The absence of Michelin at this year’s exhibition raised a few eyebrows. According to the French manufacturer, its decision not to exhibit is no big deal; although a Bauma fixture at past shows, Michelin says it is currently overhauling how it will go about presenting its OTR tyres at future trade shows.

Bridgestone and Goodyear, who together with Michelin are considered global leaders in the OTR

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business, returned in 2013 however and used this year’s Bauma as a platform to introduce their latest products to the 530,000 trade visitors attending the show.

Bridgestone – which describes itself as “global OTR tyre leader” – presented its new ‘Total Tyre Care’ concept. “The aim behind Total Tyre Care is to help customers keep tight control on tyre-related costs through maximising the life of their tyres,” explains Bridgestone Europe communications manager Andy Dingley. “The programme is therefore built around three tyre management pillars: Total Tyre Life (including retreadability and retreading), Total Tyre Services and Total Tyre Systems.”

Bridgestone’s European management in Brussels count OTR tyre maintenance and servicing under the ‘Total Tyre Services’ banner; Bridgestone explains it as including “everything a fleet needs, from fleet tyre inspections to professional technical advice on keeping tyres in top condition, for maximising their total tyre life.” OTR tyre dealers who offer the highest quality service will carry the ‘OTR Elite’ label, a designation that will function as “the guarantee that Bridgestone customers are served by audited tyre specialists with the expertise

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details). The presence of world’s largest OTR tyre also ensured Bridgestone’s show stand was a well-photographed one.

The 5.2 tonne, 4.02 metre 59/80R63 VRF tyre is intended for high ‘TonKilometre per Hour’ operations and was developed to fit rigid dump trucks up to 400-tons, such as those working in coal-and copper mines.

The Goodyear stand also displayed productrelated services alongside new tyres. A main focus was the Frank Löb, OTR tyre sales manager at Goodyear Dunlop Tires ‘FleetOnlineSolutions Germany, anticipates an upswing in OTR tyre markets this year, Mobile Technical at least in certain segments. He is pictured here with the RD-5D Evaluation’ (FOS Mte). A wheel loader tyre Goodyear representative and equipment to provide the best advice told our sister publication Neue and after-sales support, in order to optimi- Reifenzeitung, who represented Tyres & se the performance and life of Accessories at Bauma, that FOS Mte has Bridgestone OTR tyres.” Currently some been available to OTR segment custo300 OTR Elite dealers have been audited mers since the start of this year. The in France, Germany, Austria, Spain and argument behind introducing the service is that while tyre quality and performance Switzerland.

‘Total Tyre Systems’ covers tyre track- play an irreplaceable role in maximising ing and monitoring technology – specifi- the productivity of the machinery they’re cally, Bridgestone’s ‘B-TAG’ real-time tyre pressure monitoring system for giant tyres.

Bridgestone states that BTAG can provide “accurate and reliable reports on the entire performance history of the tyres at a glance.”

Alongside other new additions to the Bridgestone OTR portfolio, the Japanese manufacturer introduced the 20.5 R25 VDSR pattern at Bauma (see separate text for further

fitted to, incorrect fitment and maintenance leads to shorter tyre life, poor performance and therefore higher cost per hour. The tyre maker’s latest support programmes are aimed at ensuring its customers, irrespective of where they operate, receive the backup and advice essential for the maximum return on investment from their tyres.

“OTR tyres are a significant investment but without correct maintenance they will not give the expected performance and will not last long either,” explains Octavian Velcan, managing director of Goodyear OTR Tyres in the EMEA region. “OTR vehicles and equipment, by their nature, frequently operate not only in hostile conditions but also a long way from tyre service workshops.

For this reason we offer our two programmes: ‘Goodyear at your Service’ and FleetOnlineSolutions Mobile. Something as basic as tyre pressures can make a huge difference to operating costs and we are able to show a customer just what those cost variations are.”

Goodyear at your Service provides additional expert support when purchasing and operating Goodyear OTR tyres.

It is available to all off-road equipment operators in Europe and registration facilitates communication with a local OTR

Czech Republic-based Mitas showed its relatively young but growing OTR radial portfolio at Bauma; in the foreground is the new Mitas ERL-50 in size 20.5 R25

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BKT showed its current OTR line-up at the show, including the all-steel Earthmax radial range tyre specialist or prompt supply of required information. “The nature of the industry we serve means that often our customers are in remote places, such as in mines or quarries. For this reason, it is not always possible for a tyre technician to make regular visits to advise some customers,” Velcan adds. “Our programs mean that a customer can get essential advice on the fitment, care and maintenance of tyres quickly and accurately – even in the most remote location.”

New Goodyear products on show at Bauma included the EV-4C straddle carrier tyre and the RT-5D wheel loader tyre – further details can be found later in this section and in our specialty tyres feature.

Czech Republic-based manufacturer Mitas and its three European tyre brands is an agricultural segment market leader, however the company is also building up its OTR tyre business. Last year, almost a quarter of the firm’s turnover was generated through MPT, OTR or industrial tyres, and the company’s manufacturing presence in its homeland, in Serbia and the US offers further growth potential. And although many European market segments are already heavily radialised, during the Bauma show Mitas representatives shared that in future the company intends to also offer cross-ply tyres in

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markets where demand for these exists.

Such a product is the new cut and wear, which will be released globally in July.

At present Mitas offers OTR radials in sizes up to 25-inches in diameter, however the portfolio will gradually be extended to include 35-inch or potentially larger fitments. The company produced its first OTR radials four years ago and during the course of this year will release its first radial port tyres. “In future we intend to play an important role within this segment,” a company representative told Tyres & Accessories’ sister publication.

Indian manufacturer Balkrishna Industries – whose brand name BKT stands for Balkrishna Tyres – didn’t just show off its growing earthmover and offroad ranges at Bauma. It also continued with the advertising campaign introduced at the SIMA show in Paris earlier in the year; weary-footed Bauma visitors were ferried from one end of the Munich Trade Fair Centre site in a fleet of 20 BKT-sponsored rickshaws that sported advertisements from the new ‘WOW’ campaign.

In terms of products, BKT displayed an all-new addition to its portfolio, the Airomax AM27. This is a high-speed crane tyre intended for both on and off-road use. It is currently available in size 445/95

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R25 and the manufacturer says it offers “maximum robustness even with heavy loads” plus “excellent traction qualities” and cut and heat resistance. Other products on the BKT stand at Bauma included the Earthmax all-steel radial dumper and wheel loader range, which is currently available in ten 25, 33 and 35-inch sizes, the new size 18.00-25 Container King port tyre, the Loader Special and Maglift solid tyre.

As of 1 January, Continental operates its industrial tyre business under the name “Commercial Specialty Tires” and the business unit has voiced its aim of strengthening its presence in off-road segments. To-date, Continental’s presence in the off-road business has mainly centred on industrial, solid and MPT tyres, which have been sold under the Continental and Simex (Malaysia, predominantly port tyres), and at Bauma the company presented a range of underground mining tyres; these are produced in South Africa and marketed under the General brand name (see separate text for more details).

As representatives at Continental’s Bauma stand shared, the OTR tyre market is a growth area. At the end of 2006 the company sold its OTR tyre plant in Bryan (Ohio, US) to Titan International and aligned its strategic focus more towards its car, light commercial and truck tyre businesses. Some half a decade later, the talk at Bauma was that of once more establishing a “larger market presence” in the OTR and earthmover tyre business.

China’s Aeolus Tyres, together with Heuver Tyrewholesale (who exclusively distributes the brand in eight European markets), used Bauma to report the latest company news and show its current portfolio. “We offer our trade partners reliable products and services at very competitive conditions, along with comprehensive, rapid service. We want to emphasise this during the show,” comments company director Bertus Heuver.

Another Dutch tyre firm at the Munich show was earthmover and industrial tyre specialist Magna Tyres, who was present at Bauma with its new German stra-

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OTR/SPECIALTY TYRES

tegic partner, Inter-Pneu. Although the Dutch company has manufactured and distributed rubber compounds and related components for more than three decades, in recent years it has also built up a strong industrial and OTR tyre business. These tyres are manufactured in China under the Magna name and represent a substantially growing business for Magna. In summer, the company will start work on a new warehouse in Waalwijk, The Netherlands (see separate text).

Gripen Wheels was a first-time exhibitor at Bauma. The Swedish company’s core business is its earthmover tyre business. For this segment, Gripen used to offer two main brands – Hilo and Triangle. These days the company also offers OTR tyres from market leaders Michelin and Goodyear, along with products from other manufacturers.

The 606 and 608 MPT lines represent an expansion of the Alliance off-road portfolio; the company now offers a complete range of 18 to 24inch tyres for small and medium-sized loaders.

These new products were shown at Bauma together with Alliance’s German distributor, Bohnenkamp. The company also showed its extra-wide Dualmaster 506 and 528 tyres, which are designed for use on dual-wheel mobile excavators. The 22.5 inch size tyre has no spacer ring and

therefore the dual tyres provide a large, flush contact area. This helps prevent stones or other objects becoming stuck between the tyres and causing damage. The 506 is designed for use on firm ground and the 528 for use on soft ground.

For Munich-based Rema Tip Top, the Bauma show could be viewed as a ‘home game’. The company’s main focus there in regards to OTR tyres was to promote means of extending the working life of valuable OTR and EM tyres and repairing damaged tyres so they can re-enter service. On display were tyre repair materials, vulcanisation machinery, mounting and de-mounting tools – everything needed for successful tyre service in this market segment.

Tyre repair is an area that has profited from a weaker new tyre market, shares Helena Sabo, sales manager at Rema Tip Top Automotive. Rather than purchasing new tyres, OTR vehicle operators spend more on tyre repair and maintenance than during boom times; the repair business effectively operates anti-cyclically. Sabo adds that even though it is too early to make a detailed prognosis about the coming years, Rema Tip Top is confident that the market will develop positively – at least in the area of tyre repair. arno.borchers@reifenpresse.de/sg

OTR tyres don’t come cheap and therefore quality repair is an essential part of maximising working life. In this photo is Rema Tip Top’s “Thermopress EM II” vulcanisation unit for repairing OTR tyres up to 51inches

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OTR/SPECIALTY TYRES

Michelin’s solutions for a changing mining sector GUESTS

AT

LAST

SEPTEMBER ’S

Michelin-MINExpo 2012 round table agreed that the mining sector will undergo significant transformation in the coming decade. Rashpal Bhatti, vice-president of strategic supply at BHP Billiton, opined that “truck and shovel mining as we know it today is going to change” , while John McGagh, head of innovation at the Rio Tinto Group, stated that we’ll see “massive mines runThe X-Tweel SSL ning with the same level of process control as a large, integrated car Michelin XTXL factory.”

package that, according to Michelin, gives 20 per cent greater resistance to punctures, while the reinforced casing ply affords 20 per cent increased load capacity compared to predecessor tyre the XLD D1.

The XTXL was launched in the second half of 2012 and is initially available in size 35/65 R 33. Michelin says a 29.5 R 25 fitment will be released in the near future.

Michelin XADN+

Although systems such as MEMS can optimise a mining vehicle’s productivity, the tyre itself plays an even greater role.

Michelin’s latest tyre for the rapidly growing underground mining sector – a sector that requires the smallest possible tyre to carry the largest possible load at the greatest possible speed in order to keep up productivity – is the XTXL. This is the industry’s first 4 star load capacity tyre and features a tread with massive lugs and a cut resistant continuous centre as well as angled grooves for traction. The tyre has sidewall protection ribs to resist sidewall impacts and abrasion. Under the tread lurks a reinforced steel crown belt

Initially available in 29.5 R 25 for 40 ton articulated dump trucks, the summer Michelin foresees mine operators depen2012-released XADN+ is the successor ding increasingly on remote systems and to the XADN in the E3T segment. The sensors, and during the show French new tyre offers 8 to 15 per cent increased manufacturer released its latest TPMS prowear life in comparison with its predecesduct, the Michelin Earthmover sor thanks to a new, wear resistant tread Management System, or MEMS, compound. In addition, a new profile in Evolution 2. The original MEMS was the the sidewall increases damage resistfirst commercially-available electronic sysance whilst being lighter (14 kilogrammes tem for measuring temperature and presper tyre less than the 29.5 R 25 XADN). sure offered by an earthmover tyre manuLater in the year, 26.5 R 25 and 23.5 R 25 facturer. Evolution 2 is more high-performversions will be available. ance, connected, efficient version of the sg original MEMS system, and provides direct access to data regardless of where the vehicle is located in the mine, greater flexibility for the operator’s information service, At the start of the year, Michelin began distributing its X-Tweel SSL in the US and Canada. This first wireless, more powerful commercially available product to result from the Tweel project, which began in 2005, is a non-pneusoftware and communi- matic tyre/wheel unit for skid steer loaders such as those used in the landscaping, construction, concation system, tracting, refuse/recycling and agricultural industries. The size 12N16.5 SSL hub design is universal real-time tyre monitor- and can be fitted on most skid steer loaders. ing for an entire vehicle The Tweel uses traditional radial technology but requires no air, thereby eliminating the downtime fleet. MEMS Evolution 2 associated with flat tyres. Michelin says the Tweel’s single unit tyre and wheel assembly replaces the records all data from a 23 components of a typical radial. single vehicle in realIn late April, the X-Tweel SSL was honoured at the Edison Awards. Upon receiving a silver award time and remains in con- in the transportation category, Tim Fulton, head of Michelin Tweel Technologies, said Michelin contintinuous contact with the ues “to be surprised and encouraged at the extent to which the innovation is generating excitement stockroom to ensure across many vehicle segments; the receptivity has been very strong and positive.“ sg optimised management.

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Tweel hits North American market

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Magna investing in further warehouse space THE PRESENCE OF DUTCH off-road tyre The ‘ideal partner’ in Germany company Magna Tyres Group at April’s Bauma 2013 show in Germany was appropriate, given the attention Magna has paid the country – and Europe as a region – over the last six months or so. Our German affiliate publication Neue Reifenzeitung was present at the show and spoke with Magna’s marketing and sales director, Berto Beulenkamp, who outlined the company’s latest activities.

lent traction and outstanding stability due to its improved pattern. The company adds that operating costs are minimised through lowered rolling resistance and cooler operating temperatures. The MA06 is available in three compounds: A (cut-resistant), B (heat-resistant) and S (standard).

The 57-inch MA06 appeared alongside a new addition to the Magna Tyres portfolio, the Magna M-Straddle tyre, a 16.00R25 radial intended for use on straddle carriers in ports. The new tyre features a double rib pattern and heavy duty sidewalls; Magna Tyres says the MStraddle provides “outstanding shock absorption and maximum driver comfort” along with “excellent resistance to damage and impacts”.

Magna began its move towards complete tyre production with the addition of forklift truck tyres to its portfolio, establishing a full range of solid, pneumatic, presson and skid steer products. Radial OTR production started in 2006 and the company has previously indicated that OTR sizes up to 63-inch are planned. The company sells its products to more than 80 countries.

Earlier this year, Magna Tyres also announced details of a strategic relationship with German wholesaler Interpneu.

The agreement took effect in April 2013 and is described as “an important step” in introducing and building the Magna brand in Germany. Magna Tyres says it has found “the ideal partner” in Interpneu, with both companies contributing experience of international tyre sales and distribution to their cooperation. The partnership allows the Magna brand to access end users through Interpneu’s “Magna Tyres is investing heavily in the Pneuhage Reifendienste network. The European market and expanding stock aim of the deal is create a nationwide serlevels,” shares Beulenkamp. “In 2013 we vice network for Magna OTR tyres. will invest 20 million euros in our new European warehouse at our headquarters Magna’s product range site in Waalwijk, The Netherlands. We have purchased several companies adja- At Bauma the company displayed its OTR cent to our current office. The project and industrial range, including its largest begins in May with the demolition of 57-inch fitment. This towering tyre, the these office buildings. Our schedule is to 40.00R57 MA06, is intended for fitments start building the new 24,000 square on rigid dump trucks and is designed for metre warehouse in August.” use on rocky, gravel or packed surfaces.

Although a Dutch company, Magna Magna Tyres says the MA06 offers excelTyres only launched a division in its home market last October. Magna Tyres the Netherlands was set up to focus on the Dutch OTR and industrial markets. The company says it is working with a number of strategic partners to establish a network of dealers and a customer base throughout the country.

Beulenkamp comments that Magna Tyres’ partners rely upon short delivery times for OTR tyres as the products are capital intensive, and this is a key reason behind the decision to build the new warehouse in Waalwijk. Another decisive factor was the growth in OEM customers; the marketing and sales director says the number of European OEM partners committing themselves to Magna Tyres is “increasing beyond expectation”.

Magna’s 57-inch MA06 fitted to a dumper operating in a Chilean copper mine

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Kirkby Tyres – ‘Moving the earth for you’ KIRKBY TYRES has been at the fore- completed with the REM8 High Speed compound front of tyre and wheel wholesaling and distribution for over 60 years and has established itself as one of the largest tyre and wheel ‘full line wholesalers and distributors’ in Europe. With a head office and warehouse on a six acre site next to John Lennon airport in Liverpool and offices in Scotland, Ireland and China the company says it can supply a tyre or wheel for any application. This of course, includes OTR tyres, and Kirkby Tyres says it has a comprehensive range of tyres and wheels for this sector, including from leading manufacturers such as Alliance, BKT, Double Coin and Belshina.

crane tyre, which Kirkby says continues to be a very popular tyre due to its durability and competitive pricing.

In addition to representing Double Coin, Kirkby Tyres is also the sole UK and Ireland agent for the extensive Alliance range of agricultural, earthmover and OTR tyres. The Alliance OTR range includes a new wide-based radial in the 650 pattern for use on loaders, dozers and graders. The 650, says Kirkby, has been designed with a compound that has exceptional wear characteristics and an all-steel casing for superior durability and puncture resistance. The new radial is available in sizes from 15.5R25 up to and including 26.5R25. A new range of port/mining tyres are also now available in the 311, 314 and 315 designs. The 311 is available in 14.00-24 and 14.00-25 sizes, ideal for rigid dump trucks, port and The company is the sole UK and Ireland mining applications, the 311 has been agent for the Double Coin brand and designed with extra thick sidewalls for added protection. The offers an extensive and well proven new 314 is available range of OTR tyres – some of in a 12.00-24 L5 the latest additions include slick designed 27.00R49 REM9 and the for underground 51 and 57-inch REM11 mining applicaradials designed to go tions, the ultra on rigid dumpers. deep L5 tread These new fitments ensure longer complement the wear resisexisting range, tance on which includes the highly abrasiREM10 (E3) 26.5 & ve surfaces.

29.5R25 tyres for Finally the articulated dumnew 315 E4.5 pers and scrapers container and REM2 (E3/L3) handling tyre 17.5R25 through to has the hig26.5R25 and REM hest tread 18 (L5) 35/65R33 depth in its segfor use on loaders, ment, this coudozers and graders. pled with a speciAlso new to this range al heat reducing are the 26.5R25 and 29.5R25 L5’s in the Double Coin’s REM-11, designed for fitREM19 pattern. The ment on rigid dumpers Double Coin range is

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ensures extended life expectancy. Completing the new line-up of Alliance OTR tyres is the 630 high speed crane 16.00R25 tyre with a special rubber compound with low heat buildup, the new design also allows multitreading.

Kirkby Tyres also serves as UK agent for BKT tyres. A large stock of BKT agricultural, forestry, construction, Industrial, ATV, lawn & garden and OTR tyres are always available, including the latest ‘Earthmover’ range. The BKT Earthmover line-up has made its mark in this niche segment of the market with an extensive range covering the dumper, grader and quarrying markets. Some of the latest tyres to enter the market include the 12.00R24 through to 24.00R35. Another relatively new introduction is the 26.5R25 BKT SR50 L5 TL rock grip tyre. With an extra deep ‘non directional’ sturdy lug pattern it is ideal for mining, quarrying and rock extraction. The ‘Grader’ tyre market is amply catered for by BKT which includes the 17.5x25 GR288 Grader L2 – a wide based, self cleaning tyre with flat tread contours and a large contact area. It has an open spaced traction pattern which gives good grip in heavy dirt and extreme mud conditions, and a cut and chip resistant compound. A brand new release is the 18.00R25 BKT Container King E4; Kirkby says this is due in soon.

Finally, Kirkby Tyres is the official Belshina agent for the UK and Ireland, and as such offers the Belshina 35 and 49-inch radials for dump trucks.

Kirkby Tyres also offers a full range of Earthmoving wheels available from stock and fabricated to OE specification, supplied in the customer’s colour of choice; these can be manufactured in small batch runs or in high volumes to suit customer requirements. sg

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European introduction for Infinity’s proven OTR range

OTR Shearography up to 63” with Steinbichler Intact 4300 STEINBICHLER OPTOTECHNIK is a worldwide leading supplier of optical measuring and sensor technology. The ‘Intact’ tyre shearographic inspection systems by Steinbichler are used at numerous major names within the industry for the non-destructive testing of passenger car, truck, aircraft, OTR as well as Formula 1 racing tyres, and have proven their functionality around the world.

The Intact OTR series is designed for easy loading and unloading with a regular forklift – the tyre is mounted vertically into the unit, which means both sidewalls can be inspected without flipping the tyre. The new Intact 4300 for larger OTR sizes enables the shearographic inspection of giant OTR tyres with an internal diameter between 45 and 63-inches, a width of 550 1550 mm and a maximum weight of 7,500 kg. In addition to its vertical positioning, a key benefit of the machine is its short test cycle of approximately 20 minutes, with three cameras operating simultaneously.

Once the tyre is loaded, the measuring heads inside the chamber simultaneously take images of each sidewall and the tread, without air pressure.

Further images are then acquired while the tyre is under 50 millibars of under-pressure. These measurements are compared and displayed on a computer screen, allowing the identification of various non-visible defects including belt edge separations and bead turn-up failures.

Togliatti, Russia-based firm Povolzhskaya Shinnaya Kompaniya, also known as PSK, has entered the OTR tyre retreading business and now claims to be the only OTR tyre retreader in Russia capable of retreading tyres up to 57 inches using the mould cure process. To assure highest product quality of these giant tires, PSK inspects them before and after retreading using the Steinbichler Intact 4300 and benefits from the clear and immediate information the unit provides about each tyre’s integrity. sg

Tyres are loaded vertically into the Intact unit, enabling both sidewalls to be inspected in one go

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Infinity Tyres is now recognised around the world for its growing OTR tyre range. Following extensive trials in demanding conditions across Australia, Africa and Asia, Infinity’s speciality heavyduty mining tyres are now first choice fitments across a range of fleets operating in the most extreme environments.

Recently, China’s lar- Infinity’s LB01N gest privately-owned coal mining company selected Infinity to run on its underground mining equipment, and other major service contracts also testify to the quality of the Infinity OTR range, including an agreement with Chonquing Dima to fit Infinity to its production line of speciality armoured security vehicles. In addition, Infinity OTR tyres, such as the LB01N, are now fitted as preferred standard by several major companies and government authorities across the Middle East.

Infinity is now proud to introduce its tried and tested range to the European market. The line-up features the latest developments in heat and wear resistant compounds specially designed for dump trucks travelling with heavy loads over long distances, and Infinity has also developed cut resistant compounds for vehicles such as front-end loaders which operate over difficult and rough terrain. All Infinity OTR tyres feature optimised lug patterns for superior traction and stability which, together with a strengthened carcass, are said to offer an excellent combination of reliable performance and long service life.

Besides offering all major wide-based radial OTR tyres, Infinity reports significant success with its range of size 1800x25 and 1800x33 port handling equipment tyres. These are used on reach stackers and container handling equipment and have gained original equipment fitment recognition with Italian company, CVS Ferrari s.r.l. The Infinity range has also been recently selected by Jakarta’s Port Authority to be used in both Kalmar and Linde reach stakers. sg

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Bridgestone offers wide range and focus on OTR segment BRIDGESTONE’S

OTR tyre development

“The VSDR is the number one pattern for working in harsh conditions such as recycling and mining,” the tyre maker comments. “Compared to predecessor tyre the VSDL, the VSDR is said to offer significant improvement in cut resistance and tyre life, resulting in better cost per hour performance.

The complete Bridgestone OTR range covers approximately 50 different patterns in both radial and cross-ply constructions, designed for every kind of operation from the lightest to the toughest.

Each tyre benefits from Bridgestone’s latest technology in order to produce the most suitable products for all operations, including the largest radial tyre in the world, the 59/80R63 VRF. With a weight of 5.2 tonnes and diameter of 4.02 metres, the 59/80R63 VRF is one of the most formidable tyres anywhere on the market. Bridgestone notes that the VRF is especially recommended for high ‘ton-kilometre per hour’ operations. The outsize model is designed to fit rigid dump trucks up to 400-ton working in coal-and copper mines and oil sands.

Bridgestone has been designing and manufacturing off-the-road tyres for more than 70 years now, and its OTR division has been run as a separate unit from the passenger car and truck-bus activities since 1989. The Japanese tyre maker believes placing the business in its own unit has enabled it to focus more strongly on the OTR market segment than most other manufacturers and helped it develop diversified products for specific requirements, meeting customer demand for consistent high-quality tyres all over the world.

Today’s specialised software has enabled Bridgestone to develop tyres in a different way, with simulations of how a tyre behaves in various situations helping to produce extremely durable tyres. This approach also simplifies tyre development processes and shortens development times.

At the same time, Bridgestone says it has continued to accumulate knowledge of tyres at the molecular level, helping to optimise the mixture ratio and reaction between carbon, silica and rubber. This science has not only led to the development of more environment-friendly tyres – notably Bridgestone’s Ecopia tyres for passenger cars and commercial vehicles – but has also successfully extended tread life for off-the-road tyres. With its latest technologies and capability to optimise compound mixes, Bridgestone is able to develop different tyre specifications to suit specific ton-kilometre per hour requirements.

POSITION as a global leader in the off-the-road tyre market was underlined at the recent Bauma 2013 international trade fair in Munich. The brand presented a strong line-up of OTR tyres and showed off its 20.5 R25 VSDR pattern – a new premium tyre with extra deep treads for loaders and dozers – for the first time.

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The world’s largest tyre arriving in Europe

The company also continues to invest substantially in OTR tyre research and development in order to improve product quality and performance. For example, Bridgestone plants employ sophisticated technologies such as X-Ray and supersonic inspection devices to assure tyre quality.

Production of OTR tyres mining tyres increasing Bridgestone OTR tyres are manufactured at the company’s Shimonoseki, Hofu and Kitakyushu plants in Japan. Increased global industrial production, particularly in Asia in recent years, has led to increased demand for mined and quarried minerals, with a consequent increase in demand for mining vehicles. Super-large heavypayload trucks of up to 400 tons have proliferated. Kitakyushu, opened in 2009, was constructed to respond to this growing world demand for large and ultralarge OTR tyres which Shimonoseki, already the world’s largest OTR tyre plant, could no longer meet.

Similarly, the new Aiken County plant currently under construction in the US will help meet increased demand for large and ultra-large OTR tyres from mining and quarrying industries in the Americas. Moving forward, Bridgestone says it will build a production system that can continually respond rapidly to changes in market demand trends and supply customers with world-class quality products on a timely basis. sg

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Conti building up underground portfolio CONTINENTAL’S UNDERGROUND mining products are engineered at the company’s Research and Development Center in Hanover, Germany and production is based in Port Elizabeth, South Africa – close to many customers’ gold, copper, and platinum mines.Two key products in this segment are the General Tire brand Power Slick and Semi Slick.

One of the greatest challenges in the underground mining business is to keep the machines running. In these harsh environments, the performance of the tyres plays an important role in limiting downtimes. According to Continental, the Power Slick and Semi Slick reduce overall costs for customers operating in the underground mining business while increasing durability and safety.

The two product lines are said to provide excellent tread depth and maximum resistance against impact damages and cuts. Both the Power Slick and Semi Slick are specifically designed for underground mining machines operating in harsh mining conditions. The rubber compounds provide

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maximum resistance to rock cutting and to penetrations. Continental’s dedicated carcass construction is a combination of multiple crossed textile layers, providing high loading capabilities and impact resistance.

Power Slick tyres, as the name suggests, have a smooth pattern without any tread blocks, providing excellent traction in hard rock applications. Smooth and wide tread provides excellent traction in hard rock mining. The carcass construction and the used rubber compounds realise maximum resistance against cut and impacts damages.

Semi Slick tyres have tread blocks for customers operating in soft rock applicat-

Power Slick tyres in use in an underground mine ions such as underground coal mining.

Tread provides excellent traction characteristics in soft rock mining. Reinforced sidewalls and the tread compound used provide maximum protection against rock penetrations, tearing or cutting.

Continental says it is developing new sizes to meet the requirements of new machinery with higher load capacity; its current underground mining portfolio covers 15 to 25-inch rim diameters. sg

Aeolus and Kingstone spearhead KRT’s OTR sector presence KINGS ROAD TYRES, or KRT, offers two exclusive tyre brands for the OTR market with its Aeolus and Kingstone ranges. The fast-growing Aeolus brand was established in 1965 and is one of the largest tyre producers in China. Its extensive OTR range reflects the huge domestic demand for offroad and construction machinery experienced in China and other emerging markets in recent years.

In the UK, Aeolus supplies tyres for use on earth-moving machinery and high speed cranes, in addition to its extensive TBR offer with fitments for on/off road and mixed service applications. A consistently competitive price/quality ratio is a key sales factor and is backed by a commitment to on-going research and development in bringing new fitments and patterns into the market.

KRT operates a dedicated Aeolus website to improve awareness and knowledge of the company’s extensive range of specialist tyre applications. www.aeloustyres.co.uk includes size, application and technical details for all Aeolus products

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including its OTR line-up, which includes the following patterns: A2207 E4; A2208 E4; A2230 G2; A2233 L5; A2236 L3/E3; A2237 L3D/E3D; A2238 E4; A2239 L5; A2257 L3/E3;A2259 L3/E3; A2366 IND4; and A2200 L5S. Complementing its extensive earthmover range, Aeolus also offers three sizes of high speed crane tyres with its A2235 E2 pattern.

Another high speed crane tyre option supplied by KRT is the Kingstone house brand, which covers three popular sizes – KSV01 385/95R24, 385/95R25 & 445/95R25. The Kingstone brand name has been owned by KRT since 1987 and its high speed crane tyres are developed in Europe and manufactured in China.

According to Tim Bader, KRT’s purchasing and marketing manager, the UK OTR market has proved to be resilient in recent years, despite a flat economy and reduced activity in the private construction and civil engineering

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markets. “Because OTR is such a specialist market, tyres are less of a commodity than they are in the passenger car sector, for example,” he shared. “There has certainly been pressure on price, which has encouraged sales of lower cost brands, but ultimately these products have to deliver consistent performance in demanding applications where reliability is crucial.

“Our strategy has been based on offering end users a choice of value-for-money brands and a full range of popular sizes with Aeolus and Kingstone. That approach has allowed KRT to outperform the overall market in recent years and we are committed to building on that position with the back-up of excellent stockholding and delivery together with new products that anticipate market demand.” sg

Kingstone’s KSV01

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Continental Speciality Tires ‘a clear statement to the market’ Conti renaming, restructuring part of Global Strategy 2025 designed to “intensify” global player competition

CONTINENTAL’S

INCREASED SPECIALISATION in the commercial tyre segment was discussed at the launch of its latest “third generation” coach and bus tyres, but this reorganisation, begun from 1 January, has wider implications for applications beyond TBR products. The managing director of Continental Commercial Specialty Tires (CST), Dr Michael Maertens explained that the manufacturer’s new business strategy, indicated by the restructuring of this business unit, contains initiatives for future growth with particular focus on industrial and off the road material handling, underground mining and tyres for a specialised application you may not have expected to have swift growth potential.

Dr Michael Maertens, Continental Commercial Specialty Tires MD

Primarily Dr Maertens explains the strategic thinking behind CST: “First of all, the new name ‘Commercial Specialty Tires’ is a clear statement to the market. Our renaming and restructuring of our business unit to CST is the foundation for future growth in the segment of commercial tyres. Secondly, it is the beginning of a change process to extend and enlarge our business and open up to new market segments. Thirdly, the renaming is part of our company’s Global Strategy 2025 aiming to intensify our competition with the top global players over the next decade, as well as fortifying our market-leading position in Europe and other regions of the world.”

Dr Maertens tells Tyres & Accessories that CST will “significantly extend and enlarge its product range and customer service portfolio” in the coming months. It seems Conti will seek to utilise its technology divisions in doing this, too: “Interdisciplinary execution of projects for various industry sectors will become a core competency that will help to extend our portfolio.” The focus for Conti, Dr Maertens explains, will be on “industrial

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material handling, OTR material handling and underground mining,” three segments in which Conti expects to increase sales.

Dr Maertens explains that the restructured unit will make Conti “enter large business fields,” broadening the range of tyres it produces. “Before, Industrial Tires was mainly linked to material handling,” he says. Now it will include all tyres but truck, passenger and twowheel vehicles.

This strategy is designed to deliver an increasingly specialised experience for customers too, with products “designed to meet [customers’] particular needs. For our teams and employees the new strategy means new, exciting ways of interdisciplinary cooperation.

Sales and customer service will work closely with product development to optimise portfolios. A different way of working and growth means personal growth of our people.”

While Dr Maertens clarifies that Conti is “not opening up a new Business Unit,” and is rather “implementing some structural changes,” he says that the Business Unit’s increased focus on developing “several spec-

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OTR/SPECIALTY TYRES

ialised markets” will include a process of “searching and capitalising synergies with all other Continental divisions.”

Globally, especially in key markets such as the USA, China and Germany, Conti has increased its sales team headcount. “Thus, the growth of our Business Unit will be supported strongly by our corporate structure, by Continentals’ global footprint and especially by its R&D engineering and production capabilities.”

Port business growth Conti is expecting some significant growth in a surprising specialist sector, Dr Maertens continues: “Remarkably, over the next 12 years, the global harbour business will double its capacity. According to estimates, it will increase from 600 Million TEU to 1.2 billion TEU in 2024.” (TEU are twenty-foot equivalent units, a standard unit for describing a ship’s cargo carrying capacity.

Conti believes it can provide significant cost savings to its specialist port sector customers: “At TOC Europe, Continental is about to launch a revolutionary technology especially developed for port operators offering better durability and faster loading times. Our new portfolio of tyres and its technology offer three key advantages: 1) Reduced rolling resistance, leading to increased speed with higher loading volume; 2) Protection against damage, resulting in less maintenance costs; 3) Minimised risk after minor damages (no corrosion).”

In general though, CST is focused on product portfolio extensions and enlargements and providing specialised product packages for future business areas and opportunities.

“Next up will be a new version of the underground mining product portfolio,” Dr Maertens continues, “increasing durability and safety while reducing overall costs for customers operating in the underground mining business.

“We are also very active in offering our customers efficient and environmentally friendly tyres such as our Continental LifeCycle, putting us in prime position to meet today’s markets’ and customers’ requirements. By reusing selected tyre casings the amount of energy and raw materials used in the tyre manufacturing process are reduced – which also lowers the price of the product. With customers’ help this large-scale recycling initiative will help to bring down the number of scrap tyres needing disposal as well as the emission of climate-changing CO2 – Continental’s LifeCycle protects nature and offers cost savings.”

Continental Commercial Speciality Tires’ presentation of its General Tire underground mining product portfolio at Bauma 2013 can be found in the previous section.

Goodyear straddle carrier, wheel loader tyre details GOODYEAR HAS RELEASED DETAILS of two new speciality tyre products, the EV-4C, and the RT-5D – designed to be used in port and industrial applications respectively – at Bauma (covered earlier in this issue). The EV-4C is designed to be used mainly on straddle carriers. Featuring an innovative tread to reduce lug-induced vibration the tyre increases operator comfort and promotes even tread wear. It has a nylon sidewall reinforcement to reduce the risk of impact damage, while the breakers and carcass are stronger for greater stability and productivity. The tubeless tyre is available in sizes 16.00R25 and 480/95R25.

“The robustness of this tyre, as well as its greater stability and productivity, will make it very attractive to operators,” said Octavian Velcan, managing director of Goodyear OTR Tyres in EMEA. “Handling containers, particularly when loading or unloading ships, often involves very tight schedules. Speed and reliability are the two most important factors in container handling. This tyre helps deliver both of those.”

The RT-5D features Hi-Stability Carcass Technology, which combines reinforcements in the bead area, on the carcass breakers and at the ply turn-up, resulting in enhanced productivity performance, greater protection and minimised deflection. It features an additional 25 per cent load-carrying capacity per cycle, meaning increased productivity and therefore profitability. akb

abogie@tyrepress.com

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Starco developing industrial, specialty ranges Starco’s industrial tyre plant in Sri Lanka is now producing 80,000 pieces a year. The solid tyre ranges produced by Starco Lanka Ltd, the Tusker and Unicorn, are said to fulfill a large proportion of the market demand the company receives for these products, and output from the Sri Lanka plant supports Starco’s growth into South Africa and Russia. Further details about Starco Lanka can be found on pages 84-85 of our January 2013 magazine.

The Tusker range is Starco’s premium product for this segment and is designed for three-shift operations. The Unicorn is intended for single-shift operations.

Starco’s forklift tyre portfolio covers the standard 8 to 15-inch sizes and group marketing manager Brian Lorentzen tells T&A that more dimensions will be developed in the near future.

Airless technology An entry into industrial tyre production in 2012 and a recent focus on the agricultural segment doesn’t mean Starco has turned its back on specialty tyres, however.

Lorentzen says that “Starco is active in big tyres but still developing its original core business.” An example of this is the Flex range, first introduced some five years ago and manufactured here in the UK by Starco DML in Crewe. Following on from the original Flex Pro airless tyre and the Flex Lite, Starco has further developed the line-up with the introduction of a Flex wheel for sack trucks and

small trolleys that replaces pneumatic trolleys.

“Anything that is normally run on small wheels and pneumatic tyres in normal conditions can be replaced with these wheels, and performance is comparable,” Lorentzen comments. “The tread is quite wide – while pneumatic tyres are shaped like a balloon and the contact patch becomes wider with heavier loads, a product like this needs to be wide from the beginning. It’s still flexible, and when you hit a stone it will drive over it comfortably – unlike the cheap imitation solid tyres that can be found on the market.”

These Flex tyres are now available on both plastic and steel wheels. “What is special about the Flex range is that the hub and centre is identical for both steel and plastic versions, therefore you can cover the needs of most internal transportation with a few products,” Lorentzen adds. “You can create any hub fitting for any internal transportation product with just a handful of parts.”

The Flex range will soon be adapted to other market segments

Developing the technology further Lorentzen states that Starco intends to use the Flex technology and the knowledge behind for other areas: “We will develop it further into our other segments. We expect to see different kinds of business coming from this base. The know-how we have will be used to develop products that do not currently exist in the market. This will be in mechanised segments.” He adds that a number of products developed over the last year are now being tested; the feedback Starco has received is “very promising” and the company may release the new products as soon as this summer. stephen.goodchild@tyrepress.com

Michelin + version X-Crane extends versatility MICHELIN INTRODUCED THE LATEST VERSION of its road crane tyre range, the X-Crane+, at Intermat in spring 2012, with the product available since last summer. The tyre provides users with three important advantages: increased longevity, operator comfort and safety, and easy mounting to maximise uptime. The previous generation crane tyre, named sans +, was described as the market standard setter, but the new tyre, available in the segment’s best-selling 445/95R25 size, extends these properties, according to the French giant.

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A radial tyre for road cranes, the X-Crane+ has received a speed rating of F, meaning that each tyre can carry a payload of 6,700kg at speeds of up to 80km/h. Today’s cranes are hightech machines, capable of lifting loads of 35 to 1,200 tonnes, with anywhere from two to twelve axles.

The tyre’s versatility is shown in the variety of surfaces on which it can be driven; it handles roads and highways in additi-

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on to the harsh terrain of construction sites. The tyre lasts 15 per cent longer than its predecessor as a result of its new tread rubber compound. Designed to wear evenly, the X-Crane+ slows uneven wear associated with use on harsh surfaces while enhancing comfort for crane drivers and users, which in turn improves safety. akb

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TYRES & ACCESSORIES 5/2013

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11/04/13 15:55

MOTORSPORT

Hankook extends DTM tyre partnership HANKOOK AND EUROPEAN TOURING CAR racing series DTM have signed an extension to their official tyre supplier deal, extending the partnership until at least 2016. DTM’s organisers have been sufficiently satisfied by the development of Hankook’s Ventus line of motorsport tyres to sign the deal ahead of schedule, while the Korean tyre manufacturer is keen to sustain the brand value and premium brand status it derives in part from this deal. Hankook added an all new option tyre specification this season, which it president & chief marketing officer/chief corporate management officer at believes allows the company to demonstrate the brand’s performance on premium brand vehicles.

Hankook’s president & chief marketing officer/chief corporate management officer, Hyun Bum Cho signs the early extension to its supply deal with DTM

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Hyun Bum Cho stated: “Good, stable regulations, professionalism, and an experienced, reliable management have always been the basis for successful motorsport series. The DTM is one of the most popular and well organised racing series around the world and as such has provided an ideal platform to demonstrate Hankook’s advanced and futuristic race tyre technology from the very beginning of our engagement. The early extension of our engagement as the exclusive tyre supplier to the DTM therefore was never questioned.”

Hans Werner Aufrecht, chairman of the board of DTM rights holder and promoter ITR said: “The cooperation with Hankook during the first two years of our partnership has absolutely convinced us of the high level of performance they deliver.

This is why we wanted to continue our successful cooperation beyond 2013. The early extension of the contract is a logical consequence.“ Hankook’s option tyres meet a new regulation expected to increase excitement in DTM’s 2013 season. Drivers will be able to use both the Ventus

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base line of motorsports tyres and the new “ultra-grip” Ventus option tyres during each race. Similar to Dunlop’s extended range of tyres for the British Touring Car Championship, this move is designed to create an additional variety in race strategy.

“With our new DTM exclusive option tyre we can once more demonstrate the performance of our advanced products in a unique environment - fitted on the vehicles of DTM participating premium manufacturers Audi, BMW and Mercedes-Benz,” Cho added.

“We are excited to see how the new option tyres will perform this season. By bringing two different tyre compounds into action during the races we surely will see more action on the track and more possibilities for overtaking. A big ‘Thank You’ to the Hankook engineers who have perfectly met the challenging task to develop a tyre according to our wishes – a tyre that allows for faster lap times over a limited period and then deteriorates quickly,“ Aufrecht concluded.

DTM attracts many hundreds of thousands of viewers on-site every year, and is broadcast in more than 175 countries around the world. The series is a good fit for Hankook, a brand considered by many to belong in the company of traditional premium players. It believes the series is helping to solidify its brand value in the global automotive market. The company is no newcomer to the global motorsport arena, having taken an active part in motorsport events since 1992. In addition to DTM, Hankook supplies tyres to the Italian Superstars Series, the Swedish TTA Racing Elite League, the FIA Formula 3 European Championship, the Le Mans and Nuerburgring 24-hour endurance races, and the FIA Junior WRC. akb

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MOTORSPORT

Falken Motorsports unveils upgraded VLN Porsche

Avon becomes Time Attack series tyre partner AVON MOTORSPORT has taken its place alongside Pirelli as one of two tyre companies sponsoring the Time Attack series in 2013. At the first event of the year at Cadwell Park Avon tyres were used to claim the overall fastest lap, a new Time Attack lap record in qualifying, and second place overall in the intensely close Pro Class final, thanks to the Mitsubishi Evo of Gareth Lloyd.

Time Attack organiser, Andy Barnes praised Avon for recognising the potential of the championship, and the good fit with the brand’s products provided by the series.

Originating in Japan and introduced to the UK in 2005, Time Attack is geared towards car modification. During the series production-based cars with no power or upgrade limitations are subjected to finely detailed tuning to produce the fastest lap time. The series runs at top circuits across the UK and originally used a single tyre supplier before opening up to competition in 2012. As an official tyre partner to the championship

for 2013, Avon will showcase its ZZR and competition rubber at events across the UK, with Avon technical teams supporting competitors at events.

Barnes is keen to welcome Avon into the fold for 2013: “We are very pleased to welcome Avon Tyres to Time Attack for the very first time. Our nonexclusive championship regulations with tyre brands allow all MSA List 1a, 1b and full competition tyres to be used depending on class and Avon has been quick off the mark to recognise the potential to infiltrate our grid with a range of products that is perfectly suited to Time Attack.”

Within the series, there are four competition classes: Street, Club Challenge, Club Pro and Pro, catering for all power levels and drive lines. Categories are separated into sessions on track with the leading times from qualifying progressing to the final where the points and positions are decided. akb

Avon begins its tyre supply to Time Attack for the first time at Cadwell Park (photo: Rich Sams)

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With its upgraded Porsche 997 GT3 R, Falken Motorsports holds the “clear aim of a top ten finish in the 24 Hour event” Falken Motorsports shares that it will field its Porsche 997 GT3 R in this year’s VLN Endurance Championship Nürburgring and Nürburgring 24 Hours events. It says a raft of performance upgrades for its Porsche have been carried out and, coupled with an unchanged driver line up of Sebastian Asch, Peter Dumbreck, Wolf Henzler and Martin Ragginger, Falken Motorsports says it holds the “clear aim of a top ten finish in the 24 Hour event.”

The Porsche has been upgraded with a new aero package that includes wider wings, new splitter and double canards at the front with a larger rear wing to increase downforce. Enlarged cooling vents around both the front and rear arches has also been enhanced and the car is now able to run 12-inch wide rims at the front, half an inch wider than last year. Crucial for the 24 Hour race, the 997 now sports four front headlamps.

In addition to the vehicle upgrades, Falken’s engineers in Japan have developed a range of new tyres for this season, with first track testing of the new covers set for the 16 March at the annual VLN Set-Up day.

As mentioned, Falken Motorsports is retaining its driver line-up from last year. “After a really exciting 2012 season under our belts, it makes us all the keener to get start the 2013 season underway in a few weeks,” commented Austrian racer Martin Ragginger. “We are gearing up to give it everything we’ve got for the fans and aiming for a top ten place in 24-Hour Race.”

In addition to the VLN set up day, Falken Motorsport will compete in seven of the ten VLN rounds this year. sg

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PRODUCT INFORMATION

Riding a new course Michelin unveils moto innovations This year Michelin is releasing no less than six new motor-cycle tyre lines: The Power Super Sport, Pilot Power 3, Anakee III and Anakee Wild, plus the Pilot Street and Pilot Street Radial.

The last two of these are of particular interest due to the strategic approach they represent.

In the two years that followed the 2011 introduction of the Pilot Road 3 sport touring tyre, the French manufacturer has entirely renewed its motorcycle tyre portfolio.

Michelin describes the latest arrivals as six tyres that are each dedicated to a specific purpose while all sharing one thing in common – being designed to “deliver the most complete performance combination.”

Unlike the two members of the ‘Power’ product family introduced last year, the trackonly Power Slick and the 95 per cent trackoriented Power Cup, the newest members of the ‘Pilot’ range are either exclusively (as in the case of the Pilot Road 3) or primarily intended for use on normal roads.

Pierre Fraisse, Michelin’s director of two-wheel development, shares that the new Pilot Power 3 was designed with 85 per cent road use in mind. He adds that the new tyre shares no common features with its predecessor; every detail in its construction has been changed. The border area between design for race and road use is occupied by the Pilot Super Sport, which Michelin has designed for 50 per cent track and 50 per cent road use. The 50/50 ratio also applies to the Anakee Wild, however in this case the tyre is designed for 50 per cent road use and 50 per cent off-road. The Anakee Wild was introduced to counter a swerve towards on-road behaviour with the latest generation Anakee III, which Michelin designed as a 90 per cent road tyre.

Rounding out the sextet of new tyres are the Pilot Street and Pilot Street radial, which Michelin says are intended for small utility bikes of around 250 to 300cc.

March, and during the proceedings Hubert Hannezo, the man in charge of two-wheel tyres at Michelin for the past nine years, described the tyre maker as “the brand that understands what riders want.” Fraisse adds that this applies to all segments of the motorcycle market, and therefore it is no surprise that Michelin has extended its ‘Total Performance’ concept to the motorcycle segment and claims the optimisation of factors such as safety, handling mileage and riding enjoyment without compromising in other areas. A commitment to Total Performance in the two-wheel business is important – Hannezo points out that even though only around 1,000 people within the Michelin group are employed in the motorcycle business and it represents just a small part of the company’s entire business, motorcycle tyres nevertheless deliver a “strong contribution to brand image.”

This is why the manufacturer always points out, even in the case of sport-oriented rubber such as the Power Super Sport and Pilot Power 3, that mileage and safety remain firmly in view during product development. Some rear sizes in both ranges feature 2CT+, the latest generation twocompound technology: this employs a soft compound on the shoulders and a harder rubber on the tread as well as another hard compound under the soft rubber on the shoulders. The result is greater rigidity when leaning and enhanced stability at angles, especially when accelerating sharply. Other qualities remain as before: The softer compound is responsible for grip when cornering while the harder is there to withstand sudden acceleration and braking and to extend mileage.

Strong contribution to brand image In reference to the Power Super Sport, The French tyre maker presented the six Christophe Duc, Michelin’s global marketing new tyres to international media in late director for motorcycle and scooter tyres,

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PRODUCT INFORMATION

Hubert Hannezo has led Michelin’s global two-wheel business for the last nine years

According to Pierre Fraise, director of two-wheel development, the new Pilot Power 3 shares no features with its predecessor

Christophe Duc is in charge of global market-ing for Michelin’s motorcycle tyres

Product developer Tommy Maussin gives the Pilot Power 3 void ratio as 10% – the Pilot Power Sport is 7.5%

The French tyre maker refers to the Pilot Power 3 as a “key product” in its motorcycle portfolio

also shares that this particular tyre’s casing is approximately 12 per cent more rigid than that used in the Pilot Power 3; this means air pressure can be reduced from 2.1 bar to 1.7 bar (without tyre warmers) or 1.5 bar (with tyre warmers) in order to allow for fast track laps.

Reducing air pressure markedly increases the contact patch and ultimately provides greater stability when accelerating out of corners. Other key benefits the Power Super Sport offers can be seen in the results of Michelin-commissioned Dekra tests in which the tyre was put up against key competitors. Despite achieving the same lap times as the Pirelli Diablo Rosso Corsa and Metzeler Racetec Interact K3, the Power Super Sport gave around double the mileage as the other tyres.

On the topic of mileage, Michelin promises a 20 per cent improvement over the previous generation tyre with the Pilot Power 3, as well as delivering in other key areas such as improved handling, cornering stability and wet braking.

The use of 2CT+ technology in the rear tyre gives a higher silica component in

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the centre tread and more carbon black in the shoulders, while the tyre has been given a new profile. According to product developer Tommy Maussin, this last quality is characterised by a 15 per cent groove ratio at a lean angle of 30 degrees.

Maussin describes the tyre’s void ratio of 10 per cent as “average” – void ratio for the Power Super Sport is 7.5 per cent in total and 12 per cent at a 30 degree lean angle.

The reason behind this is that with an average groove ratio on wet roads the priority is to disperse water from the contact patch and thus enhance safety. And while on the subject of wet performance, Dekra tests pitting the new Pilot Power 3 against Bridgestone’s Battlax Hypersport S20, Pirelli’s Diablo Rosso 2 and Dunlop’s SportSmart show that during wet braking from 50km/h to a standstill, the Michelin tyre stopped between almost two and close to three metres sooner than its rivals.

Performance measurements against main competitors were also carried out for the Anakee III – in this case, in regards to mileage. Jean-Francois Roziere, who is

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charge of trail tyre product development at Michelin, shares that in comparison with Bridgestone’s Battle Wing, Dunlop’s Trail Max TR91 and Metzeler’s Tourace EXP, the Anakee III wins out in this area by between 10 and 25 per cent.

“Admittedly though, our main development goal was to fulfill BMW’s original equipment requirements for the R 1200 GS,” adds Roziere’s colleague Stéphane Brihat, who oversees trail tyre marketing.

“And first and foremost that meant stability.” Incidentally, it is safe to say that Michelin succeeded in pleasing its OEM customer, as it reports that 80 per cent of bikes in this model series produced this year will be factory fitted with the Michelin tyre.

Hope for the future Each of the recently presented tyres were developed with Michelin’s ‘Total Performance’ concept in mind and along with the Anakee Wild, which will be released later this year, two further models were previewed – and the strategic approach accompanying the pair is

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PRODUCT INFORMATION

The Power Super Sport is designed for 50% track and 50% road use

very interesting. The two tyres, the crossply Pilot Street and the Pilot Street Radial, are intended for smaller bikes of around 250 to 300cc. This all sounds like pretty standard stuff, but the concept behind the two tyres is a little less so. They are primarily aimed at newly-mobile customers in emerging markets; tyre purchasers that have traded up from a bicycle to a moped, and further down the track will look to purchasing a larger motorcycle or possibly even a car. Fitted with Michelin tyres, of course.

Hubert Hannezo shares that this development has been observed in countries like Brazil, where new registrations within the 250/300cc segment have trebled over the past ten years. Hannezo

Michelin says 80 per cent of BMW R 1200 GS models produced this year will be fitted with its Anakee III as original equipment

says the same also applies to this segment in Asian markets such as Indonesia or China. For him, these “new markets” represent “hope for the industry’s future,” Hannezo told Tyres & Accessories.

Even though Michelin must “do battle” with local Asian manufacturers within this target segment, Hannezo has faith in the charisma a global brand such as Michelin offers, and he also notes that local suppliers there “don’t yet realise the advantages that can be gained through motorcycle radials.” Demand in these countries is certain to increase in hand with improvements in transport infrastructure, it is only a question of time before this happens. “And perhaps in ten years’ time it’s all be about 600cc bikes,” he opines.

With a range of just three sizes, Michelin says the Pilot Street and Pilot Street Radial covers close to 90 per cent of all bikes up to 250/300cc.

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In contrast, he anticipates little in the way of major growth impulse within the established European motorcycle tyre markets. On the contrary: The average age of motorcyclists is increasing and the younger generation mostly have other things on their minds – smartphones and gaming consoles have a much higher pull factor than the stigmatised as dangerous motorcycle. Therefore, while the low sellout of replacement market motorcycle tyres in Europe during March 2013 probably had more to do with the weather than long-term market developments, what Michelin aims to achieve through its Pilot Street and Pilot Street Radial is nevertheless logical. christian.marx@reifenpresse.de/sg

One glance at the tread on the Anakee Wild and you know the tyre is at home off-road

TYRES & ACCESSORIES 5/2013

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Angel GT outstrips rivals’ mileage, says Pirelli THE

LATEST SPORT TOURING tyre from Pirelli, the Angel GT, has hit the streets – and the Italian tyre maker claims it is number one for mileage within its segment. This weighty statement is based upon testing carried out by Motorrad TestCenter in Germany. Tyres & Accessories has yet to read the test report, however Pirelli indicates that the Angel GT was certified by Motorrad TestCenter as delivering better mileage than the Michelin Pilot Road 3, Dunlop Sportmax Roadsmart II, Bridgestone Battlax BT 023, Continental RoadAttack2 and Metzeler Roadtec Z8 Interact M/O.

Italian Superbike World Champion Max Biaggi with an Angel GT shod Kawasaki Z100SX Tourer

30% better mileage than predecessor For the test, held in Spain from 27 November to 14 December 2012, a set of 120/70 ZR17 and 180/55 ZR17 tyres were used as the standard and six Suzuki Bandit 1250 ABS bikes were used. The test was conducted on fast roads between Málaga, Algeciras, Jerez, Seville, Cordoba and Antequerra at an average speed of 120km/h and on country and mountain roads with speed limits between 90 and 110km/h between Marbella, Ronda, Algodonales, Ardales, Alora and Málaga.

The test sessions were held in dry weather conditions with rather low temperatures, but consistent throughout the period. As the route travelled through a wide range of altitudes (from 10 metres to 1,100 metres above sea level) the air temperature varied from 5 to 18 degrees Celsius, while the asphalt temperature ranged from 18 to 23 degrees Celsius.

“At the end of the test the Angel GT was found to be the tyre with the highest mileage compared to the competitors in the sport touring segment,” states Pirelli.

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Pirelli calls the Angel GT the “crowning jewel” of its sport touring range and the “natural descendent” of the Angel ST. Compared with its predecessor, the Angel GT is said to offer 30 per cent improved mileage, one metre shorter braking distance from a speed of 75km/h, improved wet grip and handling, and – something Pirelli considers even more important – the ability to maintain these characteristics at a high level over the tyre’s life cycle. This is a property Pirelli refers to as “Performance Mileage”.

And the ‘GT’ designation in the new sport touring tyre’s name? Pirelli says it adopted the letters as the Angel GT is “100 per cent Italian Gran Turismo”, an “ideal tyre for those riders who travel long distances with a passenger and the bike fully loaded, or who simply take a ride in the country, but also for those who use their bikes all year round, both for recreation and commuting.” The tyre maker says this applies no matter what bike is used, whether a touring bike, a street enduro, naked or sport bike. sg

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The Angel GT is now available in the following sizes: Front 120/60 ZR 17 M/C (55W) TL 120/70 ZR 17 M/C (58W) TL 110/80 ZR 18 M/C (58W) TL 120/70 ZR 18 M/C (59W) TL Rear 150/70 ZR 17 M/C (69W) TL 160/60 ZR 17 M/C (69W) TL 170/60 ZR 17 M/C (72W) TL 180/55 ZR 17 M/C (73W) TL 180/55 ZR 17 M/C (73W) TL 190/50 ZR 17 M/C (73W) TL 190/50 ZR 17 M/C (73W) TL 190/55 ZR 17 M/C (75W) TL 190/55 ZR 17 M/C (75W) TL 190/55 ZR 17 M/C (75W) TL 160/60 ZR 18 M/C (70W) TL

TYRES & ACCESSORIES 5/2013

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Conti reintroduces TKV11 & TKV12 moto patterns THE CLASSIC MOTORCYCLE MARKET is growing and interest in bikes from the 1980s is strong, and therefore Continental considers now an opportune time to reintroduce two former patterns, the TKV11 front and TKV12 rear sports tyres. The pair are suited for mounting on classic 1970s and 1980s bikes and fit machines as diverse as Yamaha XJ600’s and FJ1100, Kawasaki’s GPZ600R and GPZ1000RX, Suzuki’s GSX1100E and 1100 Katana, BMW’s K75 and K100, Honda’s XBR500 and Ducati’s Pantah range.

In order to improve grip on dry and wet roads, the tread compounds used in the TKV11 and TKV12 have undergone refinements, utilising developments made in Continental’s newer tyre designs.

Therefore, classic bike owners can now take advantage of the TKV11 and TKV12’s 1980s tread patterns for that period look,

but with updated tyre performance.

With regards to the tread designs, the TKV11 front tyre’s distinctive directional tread pattern is designed to cut through water for safer riding in rainy conditions and its slick shoulders are said to give good handling feedback at maxiThe TVK11 and TVK12 offer classic mum lean design and new compounds angles.

The TKV12 rear has a tread design that optimises the land/sea ratio (the ratio of tread in contact with the road to the groove area) for increased corner grip at full lean and excellent traction levels when accelerating out of the corner. Both tyres’ profiles are intended to deliver a light steering feel for

responsive handling on A and B roads.

All TKV11 and TKV12 tyres can be fitted with an inner tube when used on tube type wheel rims.

“Although discontinued a few years ago, because we had launched newer tyre designs, with the growing interest in classic bikes the time was right to reintroduce the TKV11 and TKV12 with their ‘80s tread patterns,” shared Continental motorcycle brand manager, Graham Matcham. “And it seems our decision was correct. There has been significant interest since the tyres were part of our display at the Stafford show in October.”

The TKV11 and TKV12 are available from Cambrian Tyres. sg

Avon launches Storm 3D X-M sports-touring bike tyre AVON TYRES has launched its new Storm Storm 3D X-M we’ve taken what was Europe clocking up higher mileages while 3D X-M sports-touring bike tyre, manufactured in Britain for the hypersport motorcycle market. The tyre aims to combine the performance of the Storm 3D Ultra tyre with the increased longevity demanded by riders using their bikes more regularly. The tyre will be available from UK dealers in April.

The Avon Storm 3D X-M is a new derivative of the popular Avon Storm Ultra sports-touring tyre. The tyre features interlocking three-dimensional points hidden in the tyre’s smallest grooves. Avon says that these improve stability, grip and warm-up times, while limiting tread flex. The highperformance single and multi-compound silica-rich tread enhances wet grip.

Avon recommends the Storm 3D X-M for such hyperbikes as the Suzuki GSX1300R Hayabusa, Kawasaki GTR1400 and Kawasaki ZZR1400, given its stability and handling characteristics. Older bikes such as BMW’s K1300 series and Honda’s Super Blackbird are also the intended target.

Doug Ross, head of global motorcycle tyre sales for Avon Tyres, said: “With the

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already a great tyre and built in around 1520 per cent of extra longevity through increased tread life. While we expect this to be most popular in the US - where motorcycle mileage tends to be higher – there’s an increasing number of bikers in

touring or commuting, who want a tyre that lasts without sacrificing performance.”

The Avon Storm 3D X-M is available in sizes 120/70-ZR17 (front) and 180/55-ZR17 and 190/50-ZR17 (rear). akb

Avon welcomes delayed start to bike season with offer Avon is offering motorcycle customers £15 off the fitting of Avon 3D tyres purchased from selected dealers between 1 April and 30 June. The 3D Ultra Sport, Supersport, Xtreme or the new Storm 3D X-M tyres purchased from selected Avon Tyres stockists will qualify for £15 towards the fitting of each new tyre. Customers will be asked to complete a form and the discount will be applied at the time and point of purchase.

Launched in 2012, the 3D Ultra family is the latest line of Avon sports tyres and is available in three versions: Sport, Supersport, Xtreme and is now joined by the new Storm 3D X-M. The 3D Ultra Sport is aimed at modern, road-going sports machines, while Supersport is the option for those who want to use the same tyre on road and track.

Meanwhile, the 3D Ultra Xtreme meets the market for trackday-only tyres.

Gary Bretherton, UK motorcycle sales manager for Avon Tyres, said of the offer, “We’ve had some terrible biking weather for the start of the season and we wanted to give something back to British riders, whether they’re fair weather riders who’ll only push their bikes to the limit on track, or those who want a tyre that’ll keep them going through the kind of wet weather we usually get in a British summer.” akb

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TYRES & ACCESSORIES 5/2013

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Kenda launches green tyres KENDA HAS LAUNCHED a new passenger car tyre designed with a strong focus on decreasing fuel consumption. Hosted by Varga Trading Co. in, Kenda director James Lo unveiled the newly developed eco tyres in a presentation that also showed the new tyre’s low noise pattern design. Other speakers included Dr Hongder Chang, Kenda’s general manager, who outlined the company’s goal of generating sales of US$2 billion, and dealers Mohammad Shahid, from Pakistan and Nassib Daher from Lebanon.The KR 30 is manufactured in Taiwan.

“Our tyre has reduced CO2 emission by as much as 20g/km with its unique material technology to help protect the environment,” said Lo. “It stands for a total reduction of six tons of CO2 throughout the car’s lifecycle, equivalent to the CO2 absorption of 500 trees a year,” he added.

Kenda’s engineers have brought in new technology for the tyre’s sidewall that reduces rolling resistance and wet braking performance, Kenda stated. The tyre’s “even compound” decreases friction between carbon molecules, Kenda

Dr Hongder Chang, Kenda’s general manager introduces the manufacturer’s newest product

explains, reducing heat production and therefore fuel consumption and rolling resistance. The manufacturer estimates that the tyres can reduce fuel consumption by “up to three per cent”.

The noise reduction groove in the tread has helped the KR 30 reduce noise compared to Kenda’s previous product KR 26. The company states that the tyres were tested using the R117 tyre rolling noise test.

In addition to its Middle Eastern launch, the KR 30 has been unveiled in the with an alternate name: the VezdaEco. The VezdaEco is offered in 25 sizes between 15 and 20 inches.

“We’re really excited about all the new technology the tire contains and our customers who have already purchased the tyre have also seen the benefits,“ Eric Yang, automotive marketing manager said. “The size range and higher speed rating separates the VezdaEco from our competitor’s lower rolling resistance tyres. With all the features we have developed, we feel the VezdaEco is one of the best values in the market.

“Not only will the end consumers save money at the pump with the green technology, the tyre also carries a 60,000 mile limited warranty,” mentions Yang about the Vezda Eco. “It’s a win-win combination for drivers and mother nature.”

All 25 sizes are currently available for purchase in the .

The tyre is presently unavailable in as the current formulation is not REACH compliant. Yang tells Tyres & Accessories that, while the tyre is “predominantly sold in the ” at the moment, this does not mean that the manufacturer won’t develop a variant of the product for sale within in the future. akb

New CV inner liner cuts air leakage by 30%, says Yokohama As of this month, Yokohama rubber’s tyre factories in Japan will begin using a newly developed inner liner technology that is said to “substantially” improve the retention of air pressure in truck and bus tyres.

The tyre maker says it can reduce natural air leakage by approximately 30 per cent compared with conventional liners. Not only does this help maintain air pressure, Yokohama says it also permits the design and manufacture of lighter tyres. Following the technology’s adoption in Japan, Yokohama Rubber will gradually introduce

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it at truck tyre factories in other parts of the world.

The new inner liner uses “flat talc” – particulate talc in planar shapes, a key characteristic of the mineral talc – imbedded in the rubber in multiple layers. According to the tyre maker, the flat talc blocks the permeation of air through the rubber, substantially cutting the volume of air naturally escaping from the tyre. Yokohama already utilises air leakage reduction technology for passenger car tyres; its “Airtex Advanced Liner” was released in 2009. sg

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Microphotograph of “flat talc“,magnified 10,000 times

TYRES & ACCESSORIES 5/2013

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Bridgestone launches first dedicated Ecopia trailer tyre Bridgestone’s fuel economy focused Ecopia truck tyre range has added a dedicated trailer product to its ranks for the first time: the new Ecopia H-Trailer 001. Bridgestone says the tyre has been designed to achieve increased fuel saving in highway operations, courtesy of improved rolling-resistance and wet grip performance. The manufacturer adds that the Ecopia H-Trailer 001 has strong mileage and durability characteristics.

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Bridgestone has used the NanoPro-Tech compound to reduce energy loss. The tyre also features a waved belt, which increases casing stability and durability allowing for higher load capability and casing retreadability. Compared to the new tyre’s predecessor, the R109 Ecopia, the H-Trailer 001 provides substantially lower rolling resistance and enhanced grip and braking response in wet-weather conditions, Bridgestone says.

Independent road tests conducted in July 2011 by TÜV SÜD showed that the rest of the current truck tyre range, the Ecopia H-Steer 001 and HDrive 001 provide 18.9 and 26.5 per cent lower rolling resistance respectively than the previous Ecopia series, leading to a reduction of fuel consumption of 4.4 per cent.

Together with the new trailer tyre, Bridgestone estimates that highway operators can save up to five per cent fuel with the latest Ecopia combination compared to the previous series.

“Thanks to an optimum balance between rolling resistance and mileage durability the new Ecopia tyres are the answer for fleets that want to reduce their operating costs, both in fuel cost reduction and for lowering the cost per kilometre” says Harald Van Ooteghem, senior manager marketing planning, Commercial Business Unit, Bridgestone Europe. akb

TYRES & ACCESSORIES 5/2013

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Bridgestone launches first dedicated Ecopia trailer tyre Bridgestone’s fuel economy focused Ecopia truck tyre range has added a dedicated trailer product to its ranks for the first time: the new Ecopia H-Trailer 001. Bridgestone says the tyre has been designed to achieve increased fuel saving in highway operations, courtesy of improved rolling-resistance and wet grip performance. The manufacturer adds that the Ecopia H-Trailer 001 has strong mileage and durability characteristics.

Bridgestone has used the NanoProTech compound to reduce energy loss.

The tyre also features a waved belt, which increases casing stability and durability allowing for high-er load capability and casing retreadability. Compared to the new tyre’s predecessor, the R109 Ecopia, the H-Trailer 001 provides substantially lower rolling resistance and enhanced grip and braking response in wet-weather conditions, Bridgestone says.

B

TYRES & ACCESSORIES 5/2013

Independent road tests conducted in July 2011 by TÜV SÜD showed that the rest of the current truck tyre range, the Ecopia H-Steer 001 and H-Drive 001 provide 18.9 and 26.5 per cent lower rolling resistance respectively than the previous Ecopia series, leading to a reduction of fuel consumption of 4.4 per cent. Together with the new trailer tyre, Bridgestone estimates that highway operators can save up to five per cent fuel with the latest Ecopia combination

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compared to the previous series.

“Thanks to an optimum balance between rolling resistance and mileage durability the new Ecopia tyres are the answer for fleets that want to reduce their operating costs, both in fuel cost reduction and for lowering the cost per kilometre” says Harald Van Ooteghem, senior manager marketing planning, Commerc-ial Business Unit, Bridgestone Europe. akb

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CV Show 2013 exceeds expectations Tyre manufacturers, service providers rub shoulders with the big names in logistics APRIL’S ANNUAL GATHERING OF THE UK LOGISTICS INDUSTRY,The Commercial Vehicle Show at

Continental’s ContiPressureCheck system

Birmingham’s NEC represents a fine opportunity for those in the tyre industry to connect with this side of their business.The 2013 iteration boasted the best exhibitor turnout since 2009, and the show itself seemed to have exceeded many expectations for visitor numbers, which usually number around 16,000 over its three days, the organisers say. Certainly Tyres & Accessories witnessed busy stands visiting the show on day two.The opportunity to share exhibition space with the largest commercial vehicle manufacturers, as well as communicate the latest tyre business developments – contributing to the efficiency, safety and reliability of these vehicles – to this customer base is an offer worth the effort for the likes of Continental, Bridgestone, Hankook and GT Radial, all of whom had imposing Hall Five booths close to show defining Mercedes-Benz, Ford and Volvo Trucks booths. Simon Tattersill, head of national truck, ATS Euromaster mentioned that the show’s first day was “above expectations” , and this optimistic impression of the show was clearly shared by many participants.

Continental has much to talk about having recently begun a series of planned third generation commercial tyre launches with three coach and bus tyres. The third generation is being marked by an increased level of application specialisation in the commercial segment, the details of which can be found on pp. 52-53 of April’s Tyres & Accessories.

The Conti Coach, for long distance travel, the Conti CityPlus, for regional, or intercity use, and the Conti Urban, which has been optimised for typical city-based usage. All three tyres are grouped under the more traditionally Conti-style product number, HA3, though increased branding is one of the focal points for Conti’s third generation.

Conti says handling with reliable long-distance suitability and the lowest possible rolling resistance were at the forefront of its developmental goals, but each model has emphasised different features, depending on the application. The new long distance tyre is lighter due to an improved tread, designed to reduce fuel consumption and materials used in production. It also aims for increased comfort and reduced noise, with a special sipe tread design. The regional coach tyre is more of an all-rounder, combining better economy – with higher mileage, better retreading and regrooving capabilities and optimised rolling resistance – with increased safety. The city bus tyre is

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TYRES & ACCESSORIES 5/2013

CV SHOW

Bridgestone’s stand designed to be more robust than the others, due to the alternating acceleration, braking and kerb contact in bus bays.

Additionally, a winter option is available in the form of the Coach HSW 2 Scandinavia.

Conti was also on-message for one of the vehicle manufacturers’ most important CV Show topics. The manufacturer says the third generation bus and coach tyres will play an even more important role in the reduction of fuel consumption and noise emissions once the Euro 6 emission standard comes into force at the start of next year.

At the lightest end of the CV Show’s range, Conti also introduced its new van tyre line, launching on the UK market this year. The ContiVanContact 100 is the company’s all-rounder, designed to cope with the UK’s infamous poor road surfaces and heavy loads, while still providing good mileage capabilities. It has a specially reinforced carcass and sturdy sidewall with strong scuff protection strip as well as a stone-deflecting tread design.

The tyre’s rolling resistance has been reduced by 10 per cent in comparison to its predecessor, the Vanco2. It is being launched initially in 14 sizes, with diameters ranging from 14 to 16 inches and load-bearing capabilities up to a load

TYRES & ACCESSORIES 5/2013

index of 115 (1,215 kg per tyre).

The ContiVanContact 200 has a van optimised full silica compound, which reduces rolling resistance further (15 per cent down on its predecessor) and helps to improve wet braking. Its macro block profile and sturdy tread centre also give drivers more handling precision under heavy loads. It will be available in ten sizes suitable for 15 to 16 inch rims and approved for speeds of up to 130 mph.

Conti expects the 16” van tyre segment for panel vans to continue its increase in importance – it covers 65 per cent of van tyre demand, according to the company.

Peter Robb, brand manager at Continental Tyre Group Ltd said: “Our new van range offers the latest technology for van drivers. With the two new tyres, the ContiVanContact 100 and ContiVanContact 200, the range leads the competition in terms of safety, durability and tyre life.”

Conti is also introducing its new tyre pressure monitoring system, ContiPressureCheck, to the UK in 2013, and this was also featured on its stand; ContiPressureCheck measures the pressure and temperature of each individual tyre every few seconds and delivers the results to the driver information display.

The measuring device is a single module

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with integrated sensors, data processor and communication system, housed in a rubber container that is glued to the inner surface of the tyre tread. The manufacturer says it is the only TPMS to generate its pressure and temperature data by using a sensor mounted inside the tyre, protecting it from impact, and measuring temperature data directly in the tyre without obstructing tyre fitting. Battery life is estimated to be around six years or roughly 372,500 miles.

Bridgestone was displaying its new R-Steer and R-Drive regional truck tyres, along with the latest addition to its fuel saving range, the Ecopia HTrailer. The manufacturer states that its high profile presence at the Commercial Vehicle Show has attracted scores of fleet managers and industry professionals following up interest after visiting its stand. It estimates that hundreds of people learned more about the brand and its portfolio of products at the NEC, Bridgestone’s product and marketing manager Andy Mathias said: “Not only did our stand underline our status as a true premium player, but it also allowed us to showcase some exciting new products to a captive audience. The feedback we received was extremely positive and following on from the show, we have been receiving calls and emails from a number of professionals who visited us during the three days.”

Bridgestone ran a series of seminars during each day, where key Bridgestone speakers guided visitors through the brand’s history and innovations, including its tyre pressure monitoring system.

Mathias added: “The opportunity to talk to people about our history and the pedigree that underpins each Bridgestone tyre was invaluable. Our heritage plays a big part in our overall philosophy and we had a story to tell that some people might not have appreciated.

“Overall, the show was a success on a number of levels. It is now up to us to

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Hankook’s new bead-to-bead retread line, Alphatread, was introduced at the CV Show make the most of the interest that was generated over the three days. The early signs are that this is already happening, which is great news for everyone involved.”

Hankook also unveiled several new commercial tyres at the CV Show, including the bead to bead retread truck tyre the Alphatread. Additionally Hankook’s latest truck tyres, which aim to fill a gap it identifies between medium and long haul transportation, were displayed, while the brand raised interest in its stand through its sporting sponsorships. Tom May and Phil Dowson, players from Northampton Saints RFC visited the stand, while Hankook also ran a competition to win VIP tickets to football’s Europa League semi-final, a partnership that was announced at last year’s show.

“Hankook maintain a very close relationship with our customers, which enables us to develop innovative tyre solutions,” promised managing director of Hankook Tyre UK, Tony Lee before the show, and the presence of the Smartflex,

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Hankook’s new all season range provided evidence of this approach.

The Smartflex line-up has been designed for medium to long haul purposes and consists of sizes for the steer and drive-axle position. With its adopted new technologies it aims to meet customer demands focussing on safety and economically conscious customers. The tyre range is designed to be smart and flexible – hence the name – consisting of three main sizes for steer and drive axles The range hopes to fulfil today’s demand for increased load capacities too.

The Smartflex AH31 is a five-rib steer axle tyre for medium to long haul, available in sizes 295/80R22.5, 315/80R22.5 and 315/70R22.5. It is equipped with Hankook’s Spiral Coil Technology – a winded steel belt between the traditional high-tensile steel cord belts, which is designed to improve belt durability. The new technology increases tyre life and load capacity, while stabilising footprint shape for better steering and rolling characteristics. A ‘Tread Wear Equaliser

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Stepper’ – small support blocks at the outside of ribs two and four works to prevent one-side irregular wear.

The Hankook Smartflex DH31, again available in sizes 295/80R22.5, 315/80R22.5 or 315/70R22.5 are the corresponding drive axle tyre for medium to long haul purposes. Its six-rib tread design has tread blocks in six-angle shape for improved grip, higher mileage and reduced irregular wear. Hankook’s patented “self-regenerating” kerfs in the centre of each block prevent tearing at block edges thus providing good traction throughout the tyre’s life. All Smartflex tyres come with a newly adapted threedimensional full depth kerf solution.

“The transportation business can be seen as the veins of the industrial society with just in time deliveries for nearly every product as today’s standard”, explains Hee-Se Ahn, vice president for marketing & sales at Hankook Tire in Europe. “So it is our duty to provide products that make our fleet customers able to keep their promises as flexible as possible and regardless of weather conditions, road or vehicle requirements. This has led us to develop our all new Smartflex range of all-season truck tyres that provides a smart and safe solution combined with the highest flexibility.”

The tyres will be available in Europe from the second quarter in 2013, with the 295-sizes available from the 4th quarter 2013.

The Alphatread bead to bead retread truck tyre range is designed for medium haul purposes with drive and trailer axle sizes. Hankook says it aims to meet customer demands for reducing fleets running costs by providing a ‘cradle to grave’ tyre solution.

The Alphatread R-DH05 is a drive axle tyre for medium haul, available in sizes 295/80R22.5 and 315/80R22.5. It has a wide outline and compound to improve wet and dry traction as well as longer wear. While the extra wide tread and deep grooves improve mileage, the optimised block shape provides increased rigidity under heavy loads. The Alphatread R-TH22 sized 385/65R22.5 is the corresponding trailer tyre. It has a five-rib tread

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CV SHOW

design and a so called “cool running compound”, alongside optimised zigzag grooves for stone ejection and crack prevention. Hankook says the wide, solid shoulder area provides a higher mileage and helps to prevent belt separation. Its kerfless centre rib enhances free-rolling on axle, increasing the trailer’s riding stability.

“Hankook invest constantly in research and development to provide our customers with environment-friendly products”, said Hee-Se Ahn. Above that our new Alphatread range aims to reduce running costs thus meeting the demands of our customers.” The tyres are produced by Bandvulc and will be available in the UK from the second quarter in 2013.

GT Radial debuted its first city bus tyre in addition to displaying its GT Assist programme at the CV Show. The GAU861 has an extra reinforced sidewall protector to ensure maximum resistance to curbing and impact damage, while its tread pattern comes with a new depth of 20.2mm to improve mileage performance. Available initially in 275/70R22.5, the tyre can be used in both steer and drive positions on both 4x2 and 6x2 configurations and is M+S marked indicating excellent traction in mud and snow conditions.

GT Assist launched in January to create what the brand calls the first full fleet requirement package of product, price and service from a midtier tyre manufacturer. Operating throughout the UK and Republic of Ireland and working in collaboration with the 180 sites in the dealer network, GT Assist offers continual roadside assistance within a specified response time.

The programme is managed by RAC Commercial Assistance (RACCA), who will take the initial breakdown call and find the nearest dealer who has both the correct product and capability to attend the scene within the strict timescale, and Infleet, who will handle all back office functions.

Also on GT Radial’s stand were the recently launched GAR820 and GDR619 regional steer and drive tyres. Both initially available in size 215/75R17.5, four other main sizes in the 17.5 segment will come to market during 2013 including 205/75R17.5 and 225/75R17.5. The GAR820 and GDR619 also carry the M+S marking.

Chinese TBR manufacturer, Aeolus says its first appearance as an exhibitor at the CV Show, made with its UK distributor Kings Road Tyres, resulted in product sales and strong visitor feedback. The fast-growing brand is trying to increase awareness in the UK, and amongst its range were

TYRES & ACCESSORIES 5/2013

two new patterns: the ASR69 and ADR69 truck tyres which are now available in popular sizes 295/80R22.5, 315/70R22.5 and 315/80R22.5.

Tim Bader, KRT’s purchasing and marketing manager, commented: “Aeolus is creating a name for itself in the commercial tyre sector and it was really encouraging to receive a great deal of interest at the CV Show.

“With an increasing number of Chinese manufactured tyres in the sector our focus is to create a distinct price and quality position for Aeolus. We were able to do that by demonstrating that the brand offers excellent all-round value to fleet owners and operators, especially as it can be retreaded and regroooved, which offers end users greater flexibility and life cycle value compared to many other Chinese brands.”

Wholesaler RH Claydon exhibited a number of exclusive brands, including the new Basoon range.

John Parker, business development and purchasing director, showed a sample selection of the range, attracting a lot of attention, especially from visitors looking for a value for money TBR product.

“The Basoon range is expertly manufactured in China under the direction of SD-International implementing innovative European design engineering techniques with all tyres being rigorously tested and approved for all quality control legislation. The range consists of ten pattern options covering all truck and trailer applications.”

Tyre service providers Manufacturers were not the only representatives of the tyre industry, with specialist fleet suppliers also present. ATS Euromaster invited truck fleet operators to view its Inflation Report 2013, a free guide produced exclusively for the show. ATS-E said the guide was designed to show why fleets in 2013 should pay closer attention to their tyres than ever before.

The report compares prices today with a decade ago – spoiler alert: they’re considerably higher – and demonstrated how the rising cost of tyres and fuel mean sub-optimum tyre set-ups can cost fleets. Its eight parts, including sections on underinflation and wheel misalignment, are designed to prove to fleet operators the value of increasing the attention they pay to tyre maintenance.

Peter Fairlie, the Group sales director, says: “Maximising tyre performance should have been on every fleet manager’s radar a decade ago; but in 2013, with costs spiralling, if your tyres aren’t being expertly managed then it should be ringing alarm

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bells. No business can afford to be throwing money away if it wants to be competitive and profitable.

“For example, the annual cost [based on a 4x2 tractor unit with a tri-axle trailer, fuel consumption at 8.7mpg over 120,000km] of 20 per cent under-inflation in 2003 for a 4x2 artic was £482. But in 2013 the penalty for the same vehicle has jumped to £888, which is an enormous amount of money to be wasting. By simply making sure a comprehensive tyre management procedure is in place, fleets will be able to save and potentially make a significant improvement to their bottom line.” The report is still available from ATSE account managers.

Kwik-Fit showed its new range of light commercial vehicle fleet initiatives, highlighting its mobile fleet’s LCV tyre repair and placement capability; its expanded range of premium, mid-range and budget tyres; a plan to expand availability of MoTs on Class 7 vans; and a new Kwik Fit Drive card, for LCV and car fleets, with supermarket fuel and vehicle breakdown and recovery benefits, as well as Kwik-Fit charge reductions.

The network told T&A of its plans to expand its LCV business at last year’s show, aimed primarily at van fleets, small business, sole traders and the retail market. This year, Kwik-Fit Mobile will continue to renew its 200-strong fleet, replacing up to a further 50 vans, having introduced 53 new Mercedes-Benz Sprinter 316 CDI 3.5 tonne medium wheelbase units last year. It has also recruited 10 new relief technicians.

Kwik-Fit also planned to open a new purpose-built centre in Basildon with Class 7 MoT capabilities to complement centres in Hitchin, Norwich and Telford that already offer the service (Hitchin and Norwich are branded STS Tyre Pros, which is also owned by Itochu Corporation). Luton, Sale and Bath Road, Slough are also mooted for conversion.

TruckForce, Goodyear Dunlop’s dedicated mobile service and breakdown network, is taking delivery of 60 additional Mercedes-Benz Sprinter 313 CDIs at a rate of one per day from Birmingham dealer Midlands Truck & Van. The new fleet was the focus of its activities at the CV Show.

Supertracker’s new prototype wheel aligner

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Based across TruckForce’s 15 operating centres, “hubs” for its satellite locations across England and Wales, they are being used by technicians who repair, replace and service customers’ tyres at their premises or at the roadside. The Sprinters are fitted with engine-driven PTOs which power on-board compressors, as well as Hope Safe-T-bar rear safety bumpers and roof-mounted flashing beacons.

TruckForce invested in its first 20 Sprinters two years ago. The reliability of those vans, allied to first-class back-up from the manufacturer’s commercial vehicle dealer network, were key reasons for the decision to place this latest order with Mercedes-Benz.

Marc Preedy, Goodyear Dunlop’s director, commercial tyres, said: “Having operated Mercedes-Benz Sprinter vans for a couple of years we are confident of their reliability and recognise that they provide us with a premium service, as we do to our own customers. So we had no hesitation in ordering a further 60 vans and we’re now in the process of integrating these latest units into our fleet.”

West Midlands based Truck Tyre Solutions (TTS) returned to the show having made its debut at the event last year. TTS said its main objective was to showcase its services in a fully responsive roadside service facility for truck tyres and promote the company’s extensive range of quality commercial tyres covering all market sectors. It emphasised the Firenza range; Carl Falconer – sales director at TTS opined that it is a good mid-range tyre which offers a comprehensive size and pattern option for most trucks and trailers.

“Feedback from our haulier customers is consistently positive with most being please with the brand and consider the tyres to be manufactured to a good quality standard and long last on

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CV SHOW

The Firenza brand was the main focus of the TTS stand wear. At the same time TTS has carried out its own testing schedules on Firenza tyres which has proved positive and returned impressive mileage performance.” TTS can provide a wide selection of Firenza patterns to suit most applications.

TTS also presented its Zeta truck tyre range. Falconer explains that the company has a firm partnership with Shanghai based contract tyre manufacturer, SD International, which produces the Zeta

brand: “Zeta has proved to be a good quality budget brand amidst a lot of competition within this market sector who provide a extensive pattern option for our haulier customers. In fact the Zeta range is a popular choice with our customers who are looking for an attractive looking budget pattern at a competitive price.”

TTS recently relocated its headquarters to Pershore in Worcestershire as part of its expansion programme.

Wheel alignment specialist Supertracker unveiled the prototype of its new STR210R aligner this year. The fully computerised laser wheel aligner will be introduced into the market in the near future, and was on display for inspection and discussion with a member of Supertracker’s national sales team.

Trevor Lovesy, managing director of Supertracker states: “Our latest aligner attracted a lot of interest on the stand… It is anticipated that the STR210R will become available in the next couple of months.”

Finally, Autogem was displaying its new i-sensor TPMS system, featured in the February issue of T&A. The programmable system allows workshops to configure and diagnose blank and programmed sensors through a contactless scan with the i-sensor Tool. The i-sensor Blank is a universal sensor that can be programmed effectively to become any one of more than 90 per cent of current original equipment sensors by the tool. abogie@tyrepress.com

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The end of the Russian supply/demand imbalance Bridgestone invests in Russia PCR factory BRIDGESTONE

an investment contract with Mitsubishi Corporation, the Ulyanovsk Oblast government and the Ulyanovsk Region Development Corporation on 12 April. But as well as strategically positioning Bridgestone to capitalise on the growth of this emerging market, the move also spells the end of the Russian supply/demand imbalance and raises questions about the implications for all competitors.

CONCLUDED

Under the agreement, Bridgestone and Mitsubishi will respectively hold 90 and 10 per cent equity ownership in a new tyre manufacturing company, Bridgestone Tire Manufacturing C.I.S. LLC (BMCIS). The Russia/CIS market incorporates around 300 million people and new vehicle sales have grown significantly in the region. Demand for tyres is also projected to increase, and

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Bridgestone reports that its plans to meet this growing demand with local production from its Ulyanovsk Oblast, Russia factory.

Both companies’ total investment in the project to build Bridgestone’s first tyre plant in the Russia/CIS region will amount to approximately 37.5 billion yen (£248.2 million). Production at the plant, which will be located around 560 miles

The Bridgestone/Mitsubishi signing ceremony: (l to r) Mitsubishi division COO Akira Murakoshi, Bridgestone vice-president Asia Pacific, China, Russia, Middle East and Africa Tyre Operations Kunitoshi Takeda, Ulyanovsk Oblast governor Sergey Morozov, general director of the Ulyanovsk region Development Corporation Dmitry Ryabo

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(900km) southeast of Moscow in the Zavolzhye Industrial Zone, is scheduled to begin in the first half of 2016 and will primarily focus on winter tyres for the local market. Plant capacity is projected to reach around 12,000 tyres a day by the second half of 2018.

Alongside the establishment of a tyre manufacturing company, Mitsubishi Corporation will take a 20 per cent equity position in Bridgestone C.I.S. LLC (BSCIS), Bridgestone’s Moscow-based sales company. As a result, BSCIS will have a capital of 600.6 million roubles (£12.6 million). Bridgestone established BSCIS in 1998 and will retain an 80 per cent equity holding following Mitsubishi’s investment.

More competition in general and for Nokian in particular Bridgestone’s decision to open a tyre manufacturing plant in Russia is likely to result in more intense competition between the non-domestic tyre makers in general as well as Russian car tyre market leader Nokian in particular. The news also appeared to dash hopes that Bridgestone (Nokian’s biggest single shareholder) might buy it out at some point (see below).

Now that Bridgestone has shared details of its plan to build a passenger car tyre factory and be ready to produce tyres in 2016, the race is on to assess the impact of the move on the current market situations. Indigenous tyre makers such as Nizhnekamskshina aside, there are two reasons why this announcement means more intense competition than ever between the likes of Pirelli, Yokohama, Continental, and especially Nokian (for which Russia is a key profit centre) and now Bridgestone.

This is firstly because there are doubts about the future outlook for the Russian market. According to financial

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analysts at Morgan Stanley, the Russian market is “deteriorating as we speak”, driven down by decelerating car sales and slowing economic growth. At the same time, the fact that European tyre markets are – as the ETRMA, third party data providers and analysts say – “structurally and cyclically challenged”, there are very limited options of where to sell when a competitor gains share and when the distribution chain says its inventories are “definitely not low”. This in turn puts pressure on prices and again in turn on the margins of those competing for the same share. This factor is particularly marked for Nokian, which generates greater than 40 per cent and perhaps as much as 50 per cent of its margins in Russia.

As the Morgan Stanley analysts wrote in their investors’ note dated 15 April 2013, this may not be a short term issue for Nokian. While a few years remains before Bridgestone’s Russian capacity comes on stream, the company is facing clear risks both in the short and medium-term. Nokian’s saving grace is the fact that it has a strong distribution network in Russia and former soviet states.

The facts that Continental’s regional operation is expected to start local production at the end of 2013 and that import tariffs are being phased out as Russia joins the World Trade Organisation (WTO) only add to the competitiveness of the environment. Nevertheless, as the analysts observed, this thesis could be wrong if “Nokian leverages its distribution network in Russia beyond…expectations and maintains its share and pricing power”.

Offering quite a different perspective, Deutsche Bank took the opportunity to situate the news in the context of wider domestic market development and in doing so came out with a more optimistic medium to long term view of the

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situation. According to these analysts, 22 million A+B segment (premium and upper medium) tyres were sold in Russia in 2012. Their view is that the market should reach 34 million in 2015. By this point production capacity in the country is expected to reach 35 million units compared with 17 million in 2012, ending an era of unbalance between supply and demand.

Nokian shares fall following news of Russian plant Of course the proof of any financial thesis is in the eating. According to financial news sources, Nokian shares fell 3.8 per cent when Bridgestone announced the Russian factory news. However, this is likely to have been due to the fact that Bridgestone is Nokian’s largest single shareholder rather than the complexities of tyre market positioning. Indeed, it appears that some of those hoping that Bridgestone was angling for a Nokian buy-out at some point have become disillusioned and exited their positions.

However, it has to be said that the decline in share value can also – to some extent – be explained by shorting recommendations from some market watchers.

"Some investors had hoped that Bridgestone would at some point buy Nokian Renkaat out. But now as they chose to make its own greenfield investment in Russia, that scenario has become very unlikely," Reuters quoted analyst Sauli Vilen from Inderes Equity Research as saying, adding: "Another negative thing for the stock is of course the increased competition in the future."

Having said that, Bridgestone currently continues to own 15 per cent stake in Nokian. And with a 32 per cent share in Russia, Nokian remains the domestic market leader in the passenger car tyre sector. cja/sg

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US tyre shipments unchanged in 2012, says RMA ACCORDING TO FIGURES published by the Rubber Manufacturers Association, or RMA, US tyre shipments in 2012 amounted to 284 million units. This is unchanged from the previous year – the RMA says a ten per cent increase in original equipment shipments offset a nearly two per cent decrease in replacement shipments, and it states this absence of overall growth can primarily be attributed to a “cautious consumer as well as economic uncertainties in both the commercial and consumer sectors of the replacement market.”

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Nonetheless, the RMA believes that positive signs, including rising vehicle sales and vehicle miles travelled, will result in a 1.5 per cent rise in tyre shipments this year. The association estimates approximately 288 million tyre shipments for 2013.

Original equipment tyre shipments for both the light vehicle and commercial truck sectors increased ten per cent last year due to increased demand for light vehicles and commercial trucks. Growth of almost six per cent is forecast for 2013 as new vehicle demand is expected to increase light vehicle sales to more than 15 million. Replacement tyre shipments declined in 2012 to approximately 235 million total units, a decrease of nearly 5 million units. For 2013, a modest increase of 1 million units is anticipated as small growth is expected in the Gross Domestic Product and the Industrial Production Index for both the consumer and commercial sectors.

The RMA’s Tire Market Analysis Committee report for key categories and their respective segments for 2012 and its forecast for 2013 include:

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truck tyres: An increase in demand for commercial trucks and trailers in 2012 boosted commercial OE tyre shipments by 2.6 per cent, reaching approximately 5.1 million units. However, demand for new trucks is expected to level off in 2013 and little or no change in the total OE tyre units is anticipated.

Replacement passenger tyres: 2012 shipments decreased by 3.5 million units, or 1.8 per cent, to 190.9 million units as anticipated demand failed to materialise due to continued Replacement pcr shipments declined by nearly 3.5 million units in 2012 soft economic conditions and cautious consuOriginal equipment passenger tyres: mers. For 2013, improving economic conPassenger OE tyre shipments increased ditions, positive signs of jobs added, and by 12.1 per cent to 40 million units in growth in vehicle miles travelled will be 2012, a 4.3 million unit improvement. This tempered by spending pressure on conreflects the 1.7 million unit increase in sumers. As a result passenger replacelight vehicle sales for 2012, reaching ment shipments are forecast to increase approximately 14.4 million light vehicles. by a modest 1 million units.

Replacement light truck tyres: Total For 2013, light vehicle sales are anticipated to increase another 4.2 per cent and 2012 light truck replacement shipments crest the 15 million unit mark. As such, were 28.1 million units, a decrease of 2013 OE passenger shipments are approximately 500,000 units, or 1.9 per expected to increase more than six per cent. A nearly one per cent growth is forecast for 2013 given the slowly improcent or approximately 2.7 million units.

Original equipment light truck tyres: ving economy and signs of improvement Light truck OE tyres increased 1.5 per in the housing market.

Replacement medium/wide-base/ cent in 2012 to 4.3 million units as domestic vehicle production using LT heavy on-highway commercial truck tyres experienced a marginal increase tyres: For 2012, this market declined by due to soft economic conditions in this four per cent, or 700,000 units, to 15.8 sector. This category is forecast to grow million units as fleets opted for new by nearly 100,000 units in 2013, or appro- equipment and the economy remained sluggish. No increase is forecast for 2013 ximately three per cent.

Original equipment medium/wide- owing to a sluggish commercial sector. base/heavy on-highway commercial sg

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Signing ceremony held for Yokohama’s US plant ON 29 APRIL,Yokohama Rubber officialised its plans to erect a greenfield truck and bus tyre factory in the US State of Mississippi. At a ceremony held at the West Point Ritz, near the site of the future West Point plant, some 150 miles (240 kilometres from state capital Jackson, Yokohama Rubber president and representative director Hikomitsu Noji and Mississippi Governor Phil Bryant signed the documents that give the green light for work to begin on the plant.

“This is a historic day for Yokohama,” said Noji. “Since our entry into the US market over 40 years ago, along with the subsequent acquisition of our plant in Salem, Virginia in the 1980s, Yokohama has been on a [course of] continual growth. Now we will build a factory in the United States for the first time (the tyre maker’s Salem, Virginia plant was acquired when Yokohama acquired Mohawk Rubber in 1989). It reaffirms our commitment to the North American market and to the continued mutual success of Yokohama and its business partner - our dealers. I’d like to thank Governor Phil Bryant and the State of Mississippi for their dedication in bringing this to fruition. I’d like to thank Mississippi as well for a very warm welcome.”

“I am honoured Yokohama has selected our state for its second US tyre manufacturing facility,“ said Governor Bryant. “This new plant will have a tremendous impact on the Golden Triangle region (the area within the ‘triangle’ formed by the towns of West Point, Columbus and Starkville) and on our state as a whole, and I welcome this highlyrespected company to Mississippi and look forward to our partnership in the years to come.“ Yokohama currently supplies tyres to the North American market via GTY Tire Company, a US joint venture company specialised in manufacturing truck and

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Hikomitsu Noji (second from left) and Phil Bryant (left) at the signing ceremony

bus tyres, and through export from Japan and Thailand. The company says it nevertheless “considered it necessary” to build a new plant so as to accommodate increasingly growing demand for the Yokohama brand and to further strengthen its aim of facilitating “local production for local consumption”.

“We have a big demand. We cannot supply enough,” added Noji. “So that is the reason we need to make the tyres here and deliver to the US. Made in the US. Delivered to the US.” The West Point plant will be built on

over 500-acres (202 hectares) of land, with groundbreaking planned for June and construction expected to begin in September. The plant should be completed in September or October 2015. The facility, which is expected to produce one million tyres starting in 2015, will have an initial capital investment of US$300 million and will result in 500 new jobs during the project’s first phase. Yokohama says potential plant expansions could quadruple these original employment and investment levels.

Tanaka overseeing plant projects Yasushi Tanaka, previously CEO of Yokohama Tire Corporation, CEO of Yokohama Corporation of America and CEO of Yokohama Corporation of North America, took on a new role as of 1 May. He now serves as assistant to the president of Yokohama’s Tire Business Group.

In his new capacity, Tanaka will oversee Yokohama Rubber’s global plans in regards to new plant constructions, including the West Point plant, as well as expansion work at existing plants. sg

Yokohama to build second truck tyre plant in Thailand Phase two work on Yokohama Rubber’s truck and bus tyre factory in Thailand is scheduled to begin in July. This second stage of the Yokohama Tire Manufacturing (Thailand) Co., Ltd. project involves the erection of a second plant on a 2.6 section of land adjacent to the existing truck and bus tyre factory in Rayong Province. Yokohama Rubber’s total investment in this second plant amounts to 8 billion yen (£53.6 million). The expansion will double the Thailand subsidiary’s truck and bus tyre capacity to 700,000 pieces per annum; plans are to bring the second plant into production in April 2015 and fullfledged operation the following December.

Yokohama Tire Manufacturing (Thailand) was established in January 2004 and produced its first truck and bus tyres in April 2005. Most plant output is sold in the North American and European replacement markets. The decision to build a second plant in Rayong Province was made to ensure Yokohama Rubber can speedily follow any sales increase resulting from its plan to increase global truck and bus tyre sales.

The Rayong Province site also houses a passenger car and light truck tyre plant, which started operation in November 2006. Following the completion of phase three expansion work, this facility has an annual production capacity of four million tyres. sg

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Pirelli signs Russian retail MoU ACCORDING TO A FORECAST published by IHS Global Insight in April, Russia’s premium car segment is expected to grow 5.2 per cent this year and 8.5 per cent in 2014. Pirelli focuses its strategy on this segment and therefore views Russia as a key market.

Following the signing of a Memorandum of Understanding with Russian oil and gas company Rosneft, the Italian tyre maker will soon begin construction work on its first flagship ‘PZero Platinum’ tyre shop within the country.

The inaugural PZero Platinum outlet is being built in Sochi, the Black Sea town that will host the 2014 Winter Olympics, and will be located within a new flagship filling station built by Winter Pirelli’s PZero Platinum outlets will be housed within Rosneft service stations Olympics partner Rosneft. The shop is expected work in partnership with Pirelli – one of the world’s leaders in to be completed in the fourth quarter of this year.

Pirelli says the MoU, signed by Rosneft chairman and tyre production. We believe implementation of Pirelli’s productiManagement Board chairman Igor Sechin and Marco Tronchetti on and services will make Rosneft filling stations even more Provera, Pirelli’s chairman and CEO, pushes forward the strate- appealing to customers and thus will make the partnership gic marketing and commercial agreement signed by the parties beneficial for both Rosneft and Pirelli.”

“For Pirelli, Russia is a key growth market and having a local on 20 December 2012. The MoU also paves the way for the establishment of further points of sales at selected Rosneft fill- partner as prestigious as Rosneft will enable us to reach, with ing stations and the implementation of “Safe&Go” tyre check- their guidance and support, every valuable corner of the counups. Pirelli says it and Rosneft will initially focus on the try effectively and relatively quickly,” added Marco Tronchetti Krasnodar region around Sochi to take advantage of the expo- Provera.

Pirelli has been present in Russia since 2008. Today the sure provided by the 2014 Winter Olympics.

Commenting on the signing, Igor Sechin said: “The MoU Italian tyre maker operates two factories there – in Kirov and signed today underscores the parties’ commitment to long Voronezh – together with joint-venture partner Russian term cooperation. We are delighted to develop our retail net- Technologies. sg

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BF s.r.l.

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Conti planning significant retail growth in China

Conti to boost pcr production by almost 50% in Slovakia

During the course of 2012, Continental expanded its retail network in China by some two-thirds, and this year it looks to grow by a further 40 per cent.

Beijing-based publication China Daily reports Jay Dhillon, general manager of Continental Tires China, as calling 2012 the company’s “most successful year” in terms of its retail operation.

He shared that 1,000 new authorised franchised shops were added to Continental’s network, giving it a total of 2,500.

“We will open another 1,000 authorised stores in 2013, three a day. As well as deepen our footprint into more second and third-tier cities, and maintain that speed over the next three years,” he told China Daily. “In 2012, Continental entered the second phase of our development in China, after establishing a stable foothold here.

But we need to go much faster. We spent 80 per cent of our marketing budget on opening shops and doubling our sales team in 2012.”

In addition to its franchised outlets, Continental operates its flagship BestDrive centres. The first of these opened in Guangzhou in August 2010, and by February 2013 the company had established 12 outlets. BestDrive offers more comprehensive service than other outlets and centres are designed according to international standards. Dhillon told China Daily that this year Continental will double the number of BestDrive centres it operates and then open ten to 15 new outlets a year for the next three to five years. “Establishing BestDrive stores is a key initiative to propel our rapid growth in China, as well as a major step in building our presence in the local retail market, especially in the service sector,” he said. sg

ON 10 APRIL, the head of Continental’s Tire division, Nikolai Setzer, and Slovak Prime Minister Robert Fico signed a Memorandum of Understanding concerning Continental’s consumer tyre factory in Púchov. The signing of the MoU at Continental’s headquarters in Hannover, Germany paves the way for an expansion project that will see passenger and light truck tyre capacity in Púchov rising by more than 5 million pieces a year.

Continental is yet to confirm the MoU’s fine print, however the Slovak Republic’s official website states that the German company intends to invest 250 million euros in Slovakia and create around 600 new jobs there. In return, the Slovak Republic says it has offered Continental some 20 million euros in tax concessions. The government website indicates that a large portion of this investment will be made over the next year and lead to 163 new jobs in Púchov.

At present the Púchov site manufactures 11 million passenger car and light truck tyres annually, and nearly all

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Continental’s tyre brands are produced there, including Continental, General Tire, Gislaved, Semperit, Uniroyal, Viking, Barum, Matador and Mabor. The company’s truck tyre plant in Púchov, Continental Matador Truck Tires s.r.o., produced 2.2 million tyres last year and is Continental’s second largest truck tyre factory worldwide. In terms of tonnage for both consumer and truck tyres, Púchov is on its way to becoming Continental’s largest tyre plant in Europe.

Continental’s involvement with Púchov commenced in 1998 with its shareholding in Continental Matador Truck Tires s.r.o. In November 2007 the company acquired a majority shareholding in Continental Matador Rubber s.r.o., and since that time it has almost doubled passenger car and light truck tyre production in Púchov and employed 850 additional workers. In 2009 it acquired the outstanding 34 per cent shareholding in Continental Matador Rubber s.r.o.

Today Continental employs more than 5,000 people in Slovakia. sg

Slovak PM Robert Fico (l) and Nikolai Setzer sign the MoU. Standing behind are (from left) Slovak minister of Finance Peter Kažimír and Economy minister Tomáš Malatinský, together with Burkhardt Köller, executive vice-president Controlling (Tires Division) and Executive Board member Heinz-Gerhard Wente (ContiTech)

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Kumho passes 100 million tyre milestone in China

Toyo to relocate head office in 70th year

Speaking at the Auto Shanghai 2013 show, Cao Zhuangzhu, Kumho Tire (China) Sales Company Ltd’s general manager of marketing and logistics, reported sales of 100 million tyres in China as of the end of 2012.

“Following the establishment of diplomatic relations between China and South Korea in 1992, Kumho Tire was one of the first foreign-funded enterprises to invest in China, and construction began on our Nanjing plant in 1994,” he added. “Today we have a total of more than 5,500 employees and an annual production capacity of more than 30 million tyres.”

Outlining Kumho’s marketing strategy in China, Cao shared that the tyre maker’s sponsorship of the CTCC, or China Touring Car Championship, plays an important role.

“Through a competitive bidding process, Kumho Tire beat Yokohama and Michelin to become the official tyre of the CTCC. This not only demonstrates Kumho Tire’s motorsport technology, it shows Kumho Tire’s support of Chinese motorsport.” sg

Toyo Tire & Rubber Co., Ltd. has announced its plans to build a new head office in Itami, Hyogo Prefecture next to the site of its Tire Technical Center. The Japanese manufacturer, whose current head office is in Osaka said that the company plans to relocate in August 2015, the month in which Toyo will celebrate its 70th anniversary.

The plan forms part of Toyo’s strategy for global growth, the company explains; it hopes to “create more agile management through speedier decision making.” With this move the company will make one centre for its management functions promoting closer coordination. Before then a new research and development centre is planned for opening in November 2013 in Kawanishi, Hyogo Prefecture.

Toyo’s new management team was introduced at the end of March 2013, announcing its plans to “[boost] corporate strength and sustained, innovative, continuous growth.”

The new, six floor headquarters will be built on a vacant lot, which will place it adjacent to the Company’s technology development centre. The headquarters will be about a 20 minute drive from the R&D center in Kawanishi. The location is also convenient for commuter access, and the Center has a capacity of around 350 people, with floorspace of 8,000sqm.

Toyo previously operated a plant in Itami between 1953 and 1998. akb

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PREVIEW First published in June 1946, T&A is distributed in the second week of every month by: Tyre Industry Publications Ltd. Unit I, Magnolia Centre Telford Road, Clacton-on-Sea Essex CO 15 4LP, England Telephone: +44 (0)1255 222233 Editorial: +44 (0) 1782 214224 Fax: +44 (0)1255 222234 e-mail: info@tyrepress.com Internet: www.tyrepress.com Correspondence and advertising material should be sent to the above address.

Publisher: Klaus Haddenbrock klaus.haddenbrock@reifenpresse.de Editor: Christopher Anthony chris.anthony@tyrepress.com Stephen Goodchild stephen.goodchild@tyrepress.com Andrew Bogie andrew.bogie@tyrepress.com Contributing Editor: Peter Gardner peter.gardner@tyrepress.com Advertising Manager: Alan Day alan@tyrepress.com Advertising Sales: Scott Parker scott.parker@tyrepress.com Circulation Manager: Julie Wilshaw julie.wilshaw@tyrepress.com Editorial office: 6A Salem Street, Etruria, Stoke-on-Trent Staffordshire, ST1 5PR Telephone: +44 (0) 1782 214224 Fax: +44 (0) 1782 286589 Contributors: detlef.vogt@reifenpresse.de christian.marx@reifenpresse.de arno.borchers@reifenpresse.de Layout: Heike Schomaker-Eymers Gaby Hinck 2013 Subscription Rate: £65 (UK), £85 (Europe), £120 (R.O.W.) per year.

Back issues: £5 per copy.

Reg. No: 1023538 England VAT No: 466 0254 53 Bank: National Westminster Bank PLC, 10 Station Road, Clacton-on-Sea, Essex CO15 1TA Account No: 70304440 Sort Code: 60 05 33 Printed by: The Magazine Printing Company 1082 Mollison Avenue Brimsdown, Enfield Middlessex EN3 7NT Printed in the UK by The Magazine Printing Company, using only paper fro FSC/PEFC suppliers. www.magprint.co.uk Tyre Industry Publications Ltd. can accept no responsibility for the veracity of claims made by contributors, manufacturers or advertisers

TYRES & ACCESSORIES 5/2013

In Our Next Issue A brief look forward at a few of the articles appearing in next month‘s T&A.

I High performance tyres I Recent global growth of the high performance tyre business has outstripped that of passenger car tyres as a whole, making these products hot performers both on the road and in turnover figures. In June, Tyres & Accessories turns its attention to this high profile market segment.

I Tyre Recovery I The uses for end of life tyres are varied. Those not reincarnated through retreading can look forward to being utilised in a number of products and applications. Next month we look at this subject in greater detail.

I Wheel alignment and lifting equipment I We like to keep our readers pointed in the right direction through uplifting features – a subject we’re tackling next month manages this quite literally. In June, Tyres & Accessories presents the latest products and other news from the lifting equipment and wheel alignment market segments. Stay in the know – don’t miss the next issue of T&A.

I Retreading Special I Those suffering from retreading withdrawal symptoms need no longer suffer – the next dose of retreading news and information will be dispensed with your June issue of Tyres & Accessories. Our Retreading Special supplement, produced together with our sister publication Neue Reifenzeitung, returns next month.

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