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INDUSTRY NEWS /JAMAICA
a saving of 80 per cent on raw materials used in the production of the tyre, which is a shining badge for any environmentally conscious haulier.”
As a result of these growing sales and stable market conditions, Continental is investing ten million Euros in a new truck and bus retread tyre plant in Hanover. This facility, due to come on stream late next year, is unique in the way it takes the used rubber which is buffed off the tyres in preparation for retreading and recycles it in the production of new and retread tyres.
Looking ahead into 2013, Mr Gregg said that Continental would be launching a new range of bus and coach tyres at the UK Commercial Vehicle Show in April. These tyres will be engineered for three specific segments: Conti Coach for long distance coach travel, with tyres that offer low rolling resistance and high mileage; Conti CityPlus for regional operations between towns and cities; and Conti Urban for city use with its continuous braking and acceleration.
Also to be launched onto the UK market at the NEC in April will be ContiPressureCheck – a Tyre Pressure Monitoring System. This is a direct measurement system with sensors mounted inside the tyre to constantly monitor changes in tyre pressure and temperature. It delivers a warning to the driver via a display in the cab, enabling corrective action to be taken before a failure occurs. Summarising the year, Mr Gregg said: “Whilst 2012 was not without its challenges, I feel that we are in a strong position as we move into 2013. We have adjusted to the changing needs of the market, for example by responding to the growing demand for retread tyres. We continue to introduce products to meet specific applications, such
as our new bus and coach range. And with our ContiPressureCheck we are demonstrating our total commitment to tyre safety and optimum performance.”
Jamaica’s Ultimate Tyre Thinks Positive
Ultimate Tyres’ general manager, Kenry Jackson, Factory manager Noel Pinnock and chairman Geoffrey Chung
Jamaica’s Ultimate Tyre retreaded some 10,000 tyres in 2011-2012, setting a new production record for the company and boosting its profits. The company rolled out 10,643 tyres for the fiscal year ended March 2012, up almost 10 per cent from 9,960 the previous year. The company also made J$30.6 million in pre-tax profit, 90 per cent of which it linked to the retreads.
Its other revenue streams come from new tyre sales and tyre repairs as well as vehicle servicing, including alignment and balancing, front-end inspection and truck and car wash. Net profit amounted to J$20 million. Its tax bill amounted to almost J$11 million. Ultimate Tyre says it plans to pump back the profit into a capital development programme as it pushes for more growth through expansion. That Ultimate Tyre appears to have turned around is notable for the company was previously heavily exposed to its loss-making parent, Jamaica Urban Transit Company, and was tied to the bus company's fate. Five years ago, the Government liberated Ultimate Tyre from the management control of JUTC and recruited outside talent to run the operation. The man in charge is Kenry Jackson, who answers to a government-appointed board.
Today, instead of 65 per cent of its business being tied to JUTC as it was in 2007, Ultimate Tyre's exposure is down to 35 per cent, according to Jackson.
The result is a strong turnout from monthly losses of J$1m to monthly operating profit of J$2.5m, says chairman Dennis Chung.
Ultimate Tyre has gone from relying on government subsidies and fretting over late payments from the JUTC, to establishing its own quality controls and dominating the retread market
with average sales above J$200 million annually.
The company reported turnover of J$212m last year, which Chung says represents about 80 per cent of the retread market.
Ultimate Tyre operates a pick-up and delivery centre for clients in Manchester and another will soon be opened for the eastern parishes, including Portland.
Tyres are retreaded at the company's Maxfield Avenue, Kingston plant. It handles tyre sizes ranging from 225/60/16 for SUVs and 315/80R/22.5 for buses.
The directors of Ultimate Tyre are bullish for growth - notwithstanding a softening of and declines in the sectors that it serves - with revenue projected at J$235m for the year ending March 2013, which would amount to a year-on-year growth of 11 per cent.
Factory manager Noel Pinnock says there is an entire tourist vehicle and truck market in the western end of the island just waiting to be tapped. Chung cautions, however, that the retread market might be nearing saturation and that the board is instead looking for opportunities for vertical integration to increase income, but not whether he was looking upstream or downstream. "We are looking at products which are related but which are not really in the same market. We cannot say more at this time. We have recognised our limitation and we have to look vertically to expand," the chairman said.
Ultimate Tyre was originally known as High Mileage Retreads Limited but was rebranded after its purchase by JUTC in 2001. The company's plant is in need of retrofitting, but Chung says that all machinery upgrades will have to be financed from cash flow
Dunlop Wins China Eastern Airlines Tyre Deal
Dunlop Aircraft Tyres’ joint venture facility in Jinjiang, China has clinched a three-year deal to support China Eastern Airlines’ fleet of ten Embraer 145LI regional jets with new and retreaded tyres.
The deal will see the Shanghai- based airline receive new tyres made at Dunlop Aircraft Tyres’ factory in Birmingham, England that will be distributed from and retreaded at manufacturer’s joint venture company, Dunlop Taikoo (Jinjiang) Aircraft Tyres.
“Our tyre distribution and retread facility in China is going from strength-to-strength and we have
now secured business with a number of major airlines in the region,” said Dunlop Aircraft Tyres’ chief executive officer, Mike Askew. “This is our first deal with a significant Chinese airline and it further strengthens our position in the regional aircraft market, where we have a fantastic history of supporting the most popular jet and turboprop airliners.”
Airlines from countries including Australia, China, India, Indonesia, Japan, Korea, Philippines and Taiwan are among those being served by Dunlop Taikoo (Jinjiang) Aircraft Tyres.
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