American Tyre Map

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Postscript from ERJ Jan-Feb 2010
22 February 2010 |  0 comments |  Print This Page

Since this is the first article I have to write in a new decade, I thought I might take a look back over the last 10 years and then extrapolate forward a few years.
Looking through the issues of ERJ from 10 years ago, I am struck by the similarity in stories.
One of the top stories from January 2000 was the break-up of BTR's automotive division following the merger of BTR and Siebe, to form Invensys. This was the business that included the Henniges and Schlegel brands in the sealing business.
There has been no stability in that business. We have seen in just the last few months, that the Indian company controlled by the Ruia brothers has bought significant parts of that empire, which has changed hands a number of times in the intervening years. This event on its own underlines one of the major trends in the industry and that is the steady decline of many of the great Western names of the past, which have been acquired by wealthy private owners based in the developing world.
These are strong names, carrying a long and noble brand history. Back then, they had been starved of investment and run down as cost-conscious management aimed to extract the last ounce of profit from the businesses.
It is a trend we saw in the 1980s when Japanese tyre makers wanted to enter the global playing field, and the story was exactly the same.
In that decade Bridgestone bought Firestone while Sumitomo bought the Dunlop activities. Sumitomo still retains the Dunlop brand in parts of the world, but they eventually sold much of it back to Goodyear. Meanwhile Bridgestone had a bad experience with Firestone brand tyres, born out of lack of technology and has gradually all but dropped the Firestone brand.
Today, we are once more seeing Asian companies buying established Western brands. Many industrial commentators in the west see little value in the manufacturing activities of these assets. They have old and anachronistic factories in high-cost regions of the world. The labour forces are entrenched in their practices, highly unionised and unwilling to implement significant change.
By contrast, greenfield factories set up in Asia and other developing parts of the world offer modern factory design, highly automated production and a willing and flexible workforce who are very happy with wages that western workers would find insulting. The new owners are not buying production and productivity, They are buying brand and heritage. It remains to be seen if the Ruia brothers will be any more successful than either Sumitomo or Bridgestone in integrating their new acquisitions and then leveraging the brand credibility they have bought. The other big story of 2000 was Pirelli's MIRS tyre production system. This launched in September of that year.
Not much has developed on that front. Pirelli still loves its MIRS system, though I keep hearing rumours that MIRS is relatively expensive way to make tyres.
This month, I'm writing about a process with very similar aims – VMI's MTM system. I've thought for a long time – ever since I first met Eric Holroyd – that small volume, highly flexible, operator-free tyre manufacture would be the future of high-added-value tyres – and also of more standard tyre production.
Michelin got there first with the C3M. That's being used routinely to make high added value tyres, such as those used on Bugatti's Veyron. And if you need to ask how much a set of those costs, then you can't afford them.
Word has it that C3M works, but it's a bit unreliable and in terms of cost of production per unit, not competitive with Michelin's high flexibility standard system.
Then Pirelli came up with the robotic system called MIRS. It's more competitive than C3M, and has been installed in greater numbers, but the unit cost remains higher than more conventional systems.
In both of these cases, it was the engineers who developed and built the system using resources which were, in project terms, relatively loose on the cash front. Trouble is that tyre building is a complex process handling a range of different materials and the early attempts at developing solutions based on mechanical engineering simply weren't good enough.
On the other hand, computers, optical recognition, electronic communication and servo motors have been developing very rapidly in the last two decades
We're now ten years beyond MIRS and, it may be that we need another decade before control technology is fast enough and cheap enough to make fully automated tyre building a real, economically viable possibility, but I have a suspicion that the MTM might have got there at just the right time.
It's certainly the right time commercially. It brings together all the trends – Single mould tyres; demand pull production; rapid development times; enhanced customisation and of course, highly flexible hands-off production.
Will this be the one to change the industry – only another decade will tell, but the signs are there, if anyone cares to read them.

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