South Korean Firm Buys Goodyear Cord Business
Goodyear Tire & Rubber Co. is selling its global tire cord operations to South Korea’s Hyosung Corp. The $80 million deal includes tire cord plants in Utica, NY, Decatur, AL, Americana, Brazil, and Colmar-Berg, Luxembourg. Additionally, Goodyear and Hyosung signed a supply deal assuring Hyosung with $350 million to $400 million in purchases in the first year. This is the second U.S.-based tire cord business Hyosung has purchased. In 2003, Hyosung bought Michelin North America’s tire fabric plant in Scottsville, VA, signing an exclusive supply deal with MNA.
Improved Natural Rubber Prices Could Ease Manufacturing
If the current raw material price trend continues, it could help improve margins at tire manufacturers. Natural rubber, which accounts for about a quarter of tire raw material costs, is down more than 20 percent from the all-time high it hit earlier this year.
Chinese Aftermarket Expected to Triple Over Next 10 Years to $12.2 Billion
China’s automotive aftermarket is currently under developed and ready for market contenders to enter, according to Market Analysis, a quarterly newsletter published by the Motor & Equipment Manufacturers Association (MEMA). Referencing multiple government surveys and certain internet sources, MEMA estimates the value of China’s aftermarket to be worth $12 billion by 2015. This market, which held a value of $4.4 billion in 2005, is predicted to more than triple in size it 10 years.
Timken, Clemson University Announce Endowed Chair for International Center for Automotive Research
The Timken Company and Clemson University have jointly announced that Dr. John Ziegert will hold The Timken Chair in Automotive Design and Development at the Carroll A. Campbell Graduate Engineering Center at the Clemson University International Center for Automotive Research (CU-ICAR).
Pension, Labor Issues Weigh on Goodyear Credit
Goodyear Tire & Rubber has made considerable progress on a North American turnaround, but looming pension liabilities, tough labor talks and high material costs are raising credit investors’ worries that further progress could be slow.
Bridgestone Gets F1 Bid
No other tiremaker stepped up, leaving Bridgestone Corp. as the lone applicant to be the sole tire supplier to Formula One. Bridgestone signed a three-year deal to be the official tire provider for the 2008 through 2010 seasons; because Groupe Michelin will withdraw from the series after this season, Bridgestone will also be the sole supplier for the 2007 F1 season. Federation Internationale Automobile (FIA) announced the decision to go with Bridgestone on July 5.
Conti Holds Firm in Face of Raw Materials Hike
Continental AG has joined Bridgestone Corp., Groupe Michelin and other tiremakers in upping their estimates of the impact growing raw material costs are having on financial results. Continental Chief Executive Manfred Wennemer told investment bankers this week that the tiremaker now expects to incur added costs of up to $377 million compared to about $265 million in added costs in 2005.
Job Security Crucial in Goodyear Talks: Steelworkers, Company Preparing to Negotiate
Early next month, when Goodyear Tire & Rubber Co. executives and the United Steelworkers of America exchange contract proposals, job security looks to be a major issue. But defining job security depends on the perspective of the company and the union. The current three-year contract between Goodyear and its estimated 13,000 Steelworkers employees — out of about 80,000 Goodyear employees globally — was signed during some of the Akron tire maker’s darkest days. The contract expires July 22.
Job Security Crucial in Goodyear Talks: Steelworkers, Company Preparing to Negotiate
Early next month, when Goodyear Tire & Rubber Co. executives and the United Steelworkers of America exchange contract proposals, job security looks to be a major issue. But defining job security depends on the perspective of the company and the union. The current three-year contract between Goodyear and its estimated 13,000 Steelworkers employees — out of about 80,000 Goodyear employees globally — was signed during some of the Akron tire maker’s darkest days. The contract expires July 22.
Falken Names New Director, Business Development
Falken Tire Corp. (FTC) has named John McAndrew its new director of business development. McAndrew’s primary focus will be “helping FTC grow and refine its distribution network throughout North America,” according to a release issued by the tiremaker.