Conti to build 7 tyre plants in period to 2025

By David Shaw, ERJ staff report

Hannover, Germany - Continental's tyre division has set out its mid-term vision up to 2025. Plans include becoming more global; entering new product segments and building up to seven more tyre factories in addition to previously-announced plans.

The plans were set out by Nikolai Setzer, head of Continental's tyre activity ahead of its ContiTech Forum event earlier this week. He said the plan comprises three phases. First was 2001-2010; The current phase (2011 - 2015) focusses on accelerating growth in the BRIC countries and elsewhere and building a strong technological position.

The third phase from 2016 - 2025 will position Conti with a more balanced global footprint and take it to a top-three podium position in technology worldwide. In response to a question, Setzer said taking a top-three slot in global turnover rankings was less important than selecting geographical and market segments which drive profitable growth.

Currently Conti has 17 tyre factories in 15 countries, with a heavy bias to the old world of Europe and the United States. A year ago, the company announced three greenfield projects in the United States; Russia and China as well as upgrades of existing plants.

The next stage of expansion will involves three new factories in Asia; three in the Americas and probably one in the Eastern part of Europe, in addition to the new plants announced in the current phase.

In addition, Setzer said the company plans to enter new segments to drive profitable growth. He specifically mentioned off-road mining and speciality tyres as a potential opportunity in the commercial segment and two-wheelers in the consumer segment.

A major plank of the strategy will be to build the truck tyre activity to become more representative globally and to become a major player in the fleet activity, offering a full range of products and services to the global truck markets.

Setzer noted that the company currently develops only around 4 percent of truck tyre sales from its truck tyre activities in the Asia-Pacific region. By 2025, this is expected to rise to around one third, leading to a 33-33-33 split between the three main regions of the world.

Similarly in consumer tyres, Setzer projected sales in Asian region to rise from 5 percent of the unit's total up to about 20 percent. He did not comment on the projected investment for these projects.

More on this story in the coming issue of ERJ