ERJ staff report (TB)
Aiken County, South Carolina -- Bridgestone Americas Inc. is progressing steadily on two capital investment projects in Aiken County that will make the passenger/light truck tyre plant there Bridgestone Corp.'s largest such factory worldwide and add radial giant OTR tyres to the American unit's manufacturing portfolio.
Together the two projects entail more than $1.2 billion in investments.
A little over a year ago, the Nashville, Tenn.-based subsidiary of Japan's Bridgestone Corp. revealed plans to further expand its existing passenger and light truck tyre plant in Aiken County and also construct an off-the-road radial tyre facility at a site about four miles away.
When its expansion is completed, the passenger and light truck tyre factory will grow 740,000 square feet to 2.74 million square feet and see employment boosted by more than 300 to about 1,550. The two-phase project will cost nearly $350 million and increase rated capacity to 37,750 tyres a day when at full capacity, scheduled for April 2015, according to Plant Manager John Stewart.
Bridgestone is spending about $900 million on the OTR plant, which will be the company's first outside of Japan for radial giant tyres, said Norvel Smith, the factory's general manager. It is projected to produce its first tyre in the first quarter of 2014 and reach full production by 2020, when it will have capacity to process 130 metric tons of rubber daily, producing tyres ranging in rim diameter from 49 to 63 inches.
Passenger, LT plant upgrade
Stewart said the expansion at the passenger and LT tyre factory not only will add capacity, but also bring in new technology that is more flexible, allowing the plant to produce a wider variety of products.
The Aiken unit currently uses Bridgestone's ACTAS technology - Automated Continuous Tyre Assembly System. The plant boasts 25 ACTAS lines and will bring in four more as part of the project.
"The ACTAS machine is not groundbreaking in each and every part of the process," Stewart said during a tour of the plant. "What sets it apart is it's all together on one machine and it automates the process."
With older tyre manufacturing technology, operators build each step of the tyre. But on ACTAS, all the same steps are performed but with an automated system, he said. "The operator is basically feeding the machine material and monitoring the process."
He said ACTAS is particularly effective in long runs and was designed as an original equipment tyre machine, which fits the Aiken facility well as 65 percent of its current output goes to fill car maker OE contracts. Lines made in Aiken include the Turanza, Dueler, Fuel Fighter and Ecopia.
Bridgestone also plans to install 21 of its K1-Single tyre-building machines, Stewart said. The technology isn't necessarily more advanced than the ACTAS machines, but will allow production of a wider variety of sizes.
"Whereas the machines we have now are typically in the 15- to 20-inch range - mainly sport-utility vehicle and touring tyres - the K1-Single can run sidewall over tread, ultra-high-performance, HP tyres or runflats," he said.
The first phase of the expansion adds 4,750 tyres of daily capacity, with the first tyre to be produced in the new area during the third quarter of next year. The second phase is projected to bring another 8,000 tyres daily, making the facility one of Bridgestone's largest, according to Stewart.
"In general terms, we're now a medium-sized tyre plant," he said. "When this is all done, within the Bridgestone world this will be the highest tonnage plant that Bridgestone has."
Stewart said he believes that the Aiken plant's team-based approach is a big reason for its success since its first tyre was built in 1998. "We don't want people to come in, push a few buttons and go home," he said. "When they're here, we want them to help us run the business, to be part of managing the business and helping us to make the place better with their ideas."
He said that the parent company in Japan believes in the operation and that is a big reason the site was picked for the expansion. "We had a culture they knew would work," Stewart said, "so they could bring the technology of the tyre machine that's current right now and applied throughout the world, and we would be successful."
By giving the green light to the project, Bridgestone is taking a long-term look at the prospects of the tyre market, the plant manager said. "There are some little blips along the way, like right now sales are not quite where we'd like to be on the (aftermarket) side, though OE remains strong," he said. "The belief is long term there is going to be a lot of pent-up demand that is going to have to be satisfied."
Bigger is better
Smith said Bridgestone chose Aiken County for the coveted OTR project after it had completed an analysis of proposals for different sites worldwide. The company started weighing its options in May 2011 to determine what would be its suggested location.
Bridgestone Americas then put forth Aiken County as its choice, and the parent company tapped it as the first location other than two of its OTR plants in Japan to use the firm's radial technology for giant OTR tyres.
Bridgestone produces bias-ply OTR tyres at its Bloomington, Ill., factory-which is undergoing an expanson as well-along with some smaller off-road radials.
"We were competing against the world," Smith said. "That shows a lot of confidence in the American worker. You can put this equipment anywhere in the world."
Bridgestone decided against putting the new factory on the same 585-acre property as the passenger and light truck tyre plant for two main reasons, Stewart said, opting for the nearby 545-acre site instead.
First, the company wanted to keep land available for potential additional expansion of the car/light truck tyre plant. Additionally, the firm didn't want to encroach too much on areas near homes located only a couple of hundred yards from the other side of the property, he said.
"When people look in their backyards, they'd rather see trees than a building, so we decided it was better to look for a new area of land."
Bridgestone believes there is much potential for growth in the OTR tyre market, Smith said. Output from the new facility will supply needs within the Americas, for example from the oil sands in Canada, mines in the western U.S. and for Caterpillar Inc. OE production in Illinois, among others.
The company said it views itself and Group Michelin as leaders in the OTR tyre market, with each garnering a 40-percent share.
The first tyres off the line at the new Aiken County plant will be the 49-inch tyres, which average 3,000 pounds each and cost $15,000 to $17,000, the company said. The plant then will ramp up to produce the 51-, 57- and 63-inch "giant sizes." Bridgestone said the 63-inch tyres average 13,000 pounds each, costing $70,000 to $80,000. Employment at full production in 2020 is forecast at about 550.
Smith said recent visits with Canadian customers Suncor Energy and Canadian Natural Resources revealed much about how the Bridgestone OTR tyres are viewed. "The basic thing is they like Bridgestone tyres and they really want more," he said.
From Tire Business (A Crain publication)