Interview: Bridgestone eyes top position in Europe

Based on article published in ERJ’s November/December issue:

New Bridgestone Europe CEO Paolo Ferrari tells Shahrzad Pourriahi about his first months at the company’s Brussels headquarters

Japanese business philosophy, market-share, runflats and tire-labelling were among an array of topics on the agenda, when ERJ caught up with Paolo Ferrari as he assumed the role of CEO and president of Bridgestone Europe NV/SA, responsible for Europe, Middle East and Africa (EMEA) operations.

Also on his watch is the site in Ulyanovsk, Russia, where Bridgestone has just completed the construction of a new €340-million tire-plant.

With the facility expected to roll out around 12,000 units a day by 2018 – mainly winter tires for the Russia/CIS market – Ferrari sees this as “a great opportunity to extend our manufacturing capacity in EMEA.”

The Russian plant, said Ferrari, will raise Bridgestone’s overall competitiveness, by increasing its capacity to develop and produce winter tires and to service this market.

The CEO, who led Pirelli’s Latin America division prior to his current job, said the investment underlines Bridgestone’s ambitions in Europe. The Japanese company, he stated, is gaining market-share and “outpacing industry growth” with an annual rate of 7% unit increase across passenger car and industrial tires.

“We have an ambitious, but achievable, plan for growth: we want to grow market-share in every segment, with a specific focus on higher mix,” said Ferrari.

Ferrari, who will, in addition to his current position, become a Bridgestone vice president and senior officer of Bridgestone Corp. as of next year, appreciates that the European business still has a long way to go to achieve its goals.

“Bridgestone is the leader in the world but a challenger in Europe. We fully accept the challenge this creates as it is what our goal for ‘dan-totsu’ is all about,” he said, referring to Bridgestone’s stated ambition to be the clear leader in every market in which it competes.

To achieve that goal, Bridgestone will invest across the board: from R&D resources and offer-development to manufacturing footprint and skills across the EMEA region.

In the PCR [passenger car radials] market, Ferrari believes that Bridgestone is “relatively underrepresented compared to the value of our brand, our technology and our portfolio.” Likewise, he said, “We have a solid [TBR] market-share position, but again, I think we have room to grow further.”

Progress, Ferrari expects, will be driven by Bridgestone’s development work in areas such as extended mobility and integrated tire systems.

Described by Bridgestone a “game-changer” for the replacement market, DriveGuard is being billed as a premium touring tire with the added bonus of extended mobility and, hence, safety – rather than a ‘runflat’.

According to the executive, DriveGuard volumes are now “ahead of the plan” in both winter and summer tire markets, and Bridgestone expects more than 1 million DriveGuard tires on European roads by the end of next year.

To meet the increasing demand, Bridgestone expanded production of the tires from one plant to two: Poznam, Poland and more recently Tatabanya in Hungary.

This is an example of Bridgestone’s “upside-potential and our ability to create a new replacement segment,” said Ferrari, pointing to Bridgestone’s focus on linking R&D work to the needs of the end user.

Another innovation was unveiled at the recent IAA Commercial Vehicles 2016 show, where Bridgestone showcased it’s Tirematics ‘connected tire’ system. This is designed to provide total tire-care for fleet managers.

Such developments is now being guided by a Bridgestone concept called “The Boss”, through which the tire-maker aims to become more highly focused on delivering value to its customers.

With the development of DriveGuard, for example, this has meant carrying out research to deeply understand what the driver wants, said Ferrari.

“So, everything around the new product, from the features to the messaging and execution, was based on that input and was then validated with the Boss,” he explained.

The concept, he added, extends to increasing support to Bridgestone’s distribution partners and giving them more reasons to grow the Japanese tire-maker’s brands in the market.

Asked about the impact of the increasing flow of cheap tire imports into the European market, the Bridgestone executive said investment in innovation and technology was the best defence.

“We believe that we can respond [to cheap imports] by continuing to develop a compelling overall offering for the end-users… including digitally based solutions,” he added.

This includes the EU tire-labelling scheme, which was introduced in 2012: while appreciating its contribution to consumer’s understanding of performance criteria, Ferrari called for further action on implementing the law.

“The current weak point is the limited surveillance being applied by the authorities,” he said. “Consequently, we welcome the recent European initiative for a joint-financed action in tire label market surveillance.”

Ferrari went on to note that there was an “opportunity” in the area of retreads, where he said “labelling would highlight the benefits to society through improved sustainability.”

“Ultimately, the more the regulation and the labelling is to the benefit of the consumer and pushes the technology, the better, as then we are happy to bring the right technological solutions to play,” Ferrari added.