ERJ staff report (DS)
Tokyo -- Bridgestone Corp. and Toyo Tire & Rubber Co., Ltd are to work together in areas including advanced production, purchasing of raw materials and of equipment; aligning production capacities through off-take deals, logistics and in some non-tyre activities. The two companies have also issued new share capital to each other.
In a statement, the two companies outlined areas of future cooperation. The first area covers advanced manufacturing techniques. Bridgestone and Toyo are to mutually licence their respective advanced manufacturing systems to each other. Bridgestone operates the BIRD (Bridgestone Innovative & Rational Development) system, while Toyo operates ATOM (Advanced Tire Operation Module). The two companies will also work together on small-lot production systems and specifically on strip-winding techniques to help with small-lot production.
The second area of cooperation will be in the purchasing department. Bridgestone and Toyo are to make available to each other their integrated up-stream production chains, so that Toyo will have access to carbon black, steelcord and other materials made by Bridgestone companies. The two companies will also investigate the joint purchasing of equipment and of raw materials for production.
The two will also look at mutual off-take systems, where Toyo can use Bridgestone capacity -- specifically in Latin America -- to make its products and Bridgestone can use Toyo's new capacity in North America to improve respective production efficiency and flexibility. Part of this will be studies to standardise production systems between the two companies where feasible. Furthermore, where the two companies are investigating added capacity in small-volume and niche areas, the two will specifically work together to build and modify factories to ensure those factories can make products for each company. Over the mid- to long term, the companies will implement the cross-production of radial tyres for trucks and buses, integrate manufacturing of certain products such as cross-ply tyres and supplementary products, and aim for cross-production at plants built in the future.
In terms of logistics, the focus will be on Japanese domestic production, where the companies will use each other's warehouse facilities and attempt to ensure trucks and other vehicles are fully utilised in both directions shipping tyres from one to the other whenever possible, on both outward and return journeys. Longer term, the companies aim to develop a joint transportation strategy and to strategically locate warehouses for mutual advantage.
The two companies also intend to work together in anti-vibraton rubber and in urethanes businesses. IN AVS, the two companies will conduct joint research into eco-friendly technology and production technology, and investigate the possibility of joint procurement of components.
Finally, he two companies have issued new shares to each other, to create a mutual cross-ownership structure. Toyo issued new ordinary share of 20 million stocks (8.72% of the issued stocks including this issue) and allocated the shares to Bridgestone. Bridgestone allocated 3.9 million of its treasury stock (0.48% of all issued stocks) to Toyo.
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Press release from Bridgestone