Pirelli consolidating operations in Brazil

Milan, Italy - Pirelli C. & SpA is consolidating its operations in Brazil with a possible plant closure and the investment of €120 million in the country over the next two years.

The “reogranisaiton of production structure” would involve the transfer of moto tire production from Pirelli’s plant in Gravataí, Rio Grande do Sul, to its factory in Campinas, Sao Paulo, which currently manufactures car tires only.

The move, said the Italian tire maker in a 13 May release, will strengthen the position of the Campinas factory as an industrial hub for car, moto and motorsport tires to serve the Latin American markets.

Pirelli’s production unit in Gravataí manufactures motorcycle tires only and employs 900 people.

The Italian tire maker said it aimed to find an agreement with unions to mitigate the social impact of the transfer of operations.

The company is also in talks with Prometeon Tyre Group, which already has a production facility in Gravataí, to “evaluate actions aimed at mitigating the effect on employment.”

Elsewhere, Pirelli said it was planning to pump €120 million in its production facilities in Campinas, and Feira de Santana, Bahia, over the next two years.

The move, it said, will involve modernising and converting production from standard to high value tires at the two sites.

The investment, according to Pirelli, is in addition to the €320 million “already deployed” in Brazil during the 2013-2018 period.

At the Campinas plant, in particular, Pirelli aims to optimise production processes and logistics flow and create 300 new jobs by 2020.

The Sao Paulo unit, according to Pirelli, is in a “favourable position closer to the production of facilities of car and motorcycle makers”.