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Bridgestone: A business in rapid transformation

Bridgestone: A business in rapid transformation

By Sharad Matade:

Among global tyre markets, the European tyre industry is probably seeing the most interesting trends. Momentum in sales of electric vehicles and online buying will bring opportunities to tyre companies, while other hand, Expansion of new tyre companies, especially from Asia, cheap imports and financial and political uncertainty poise challenges in the region.
Being the leader in global tyre industry, Bridgestone has already been working opportunities being generated by the new trends. In an interview with Tyre Asia, Laurent Dartoux, Chief Strategy and Marketing Officer, Bridgestone for Europe Middle East & Africa, talked about the company’s initiatives on tyres for EVs, intensifying competitions, innovative products and challenges in the Middle East and African markets.

Do you think the current financial and political uncertainty in Europe is having or will have an impact on the tyre industry in the region?

Laurent Dartoux: This is a well-established and robust industry which is in a good position to negotiate uncertainty. Yes, the industry is exposed to some degree to changes in economic and political landscapes in the short term but, like all major businesses, we build flexibility into our plans to deal with these possibilities. And in the medium term, we see more miles being driven thanks to new mobility solutions which will be a strong support for tyre growth. At Bridgestone EMEA, we are optimistic and are building on this. We’re a business in rapid transformation, innovating as a tyre manufacturer through unique technologies and working to become a mobility solutions leader. We know that if we stay on that course, we will win in the long-term, no matter what the short-term brings.

Europe is no more bastion of tyre giants. Many Asian tyre companies are expanding their business aggressively? How do you see this challenge and how will it change the dynamics of the tyre industry in Europe?

We are an Asian tyre company! It’s precisely our Japanese mid-term vision and strong technology heritage that makes us different. As a result in the past several years we have outgrown the industry, we have gained market share and this has fuelled our success in Europe. We still live by the mission of our founder, Ishibashi, to ‘Serve Society with Superior Quality’. 90 years after being founded, this is still what drives us. New entrants into the market drive competition which is ultimately healthy, and has pushed Bridgestone to stay focused on bringing innovative products and developing new mobility solutions. We believe we are uniquely positioned to do this given our unique direct access to market including our owned Bridgestone controlled channel (FirstStop, Speedy, Ayme…) and best in class customer base..

Online selling of tyres is another growing trend in Europe. How do you see the future of online tyre selling in the region and how is Bridgestone prepared for it?

Online tyre selling is a sales channel which has indeed been growing in the last few years, following the broader e-commerce transformation. Even if they don’t buy online yet, drivers often check on the internet before making any purchase.
It’s not without challenges however. Online vendors need to grapple with new distribution networks, content management, GDPR, and in the end, they also need to rely on a physical network to get tyres mounted, stored during the seasonal change…. Bridgestone is already actively selling through e-commerce channels in Europe and has a physical network of over 2000 owned or franchised stores which is a unique position of strength to take advantage of online sales growth.

Budget tyres are also picking up, If I am not wrong, particularly from China. How is the company tackling the challenge?

In any market where cost and quality are correlate, there will be a place for cheaper options at the lower end of the market. This is not where Bridgestone competes. We at Bridgestone believe that quality and technology has a cost and makes a difference. And when you know that the tyre is the only part of the vehicle which touches the road, the role we play is critical. It becomes therefore even more important to focus on listening to the consumer and giving them new innovative products and solutions that address their everyday problems and enhance the safety of their journey at all times. We also observe the market going more premium due to the high tyre technical requirements and rim sizes for SUV cars, the fastest growing segment in Europe for many years. That’s what drives our innovation and means that we create value. This insight can be seen throughout our portfolio which comprises products at various different price-points.

On technology front, what are the new technologies/ innovations that Bridgestone Europe is working on?

Thanks to our leading investment in R&D (€790 million spent globally in 2017), there have been exceptional developments in our technology and innovation for both our consumer and commercial solutions.
For consumers for example, the introduction of Driveguard, our run-flat technology, allows drivers to continue driving for an additional 50 miles at 50mph before needing to change tyre. We have also launched two new products this year – Turanza T005 which has the shortest braking distance on wet surfaces and Weather Control A005.
Bridgestone Weather Control A005 is our first ever all season touring tyre. With an innovative tread design, the Weather Control A005 combines best-in-class wet grip with qualified snow performance and superior wear life to help drivers master their journey, whatever the season.
We also developed Ologic tyres specifically designed to fit the demanding technical needs of fully electric vehicles. They have a unique tall and narrow shape with unique compound which equip the BMW fully electric i3.
For commercial vehicles, our mobility solution packages for truck and bus fleets, now complemented with FleetPulse, allow for increased time on the road and reduced maintenance costs. Furthermore, our new Ecopia range gives greater fuel efficiency for truck fleets.
In the coming weeks we will also be launching new and exciting mobility solutions for drivers that will deliver convenience and peace of mind.
We have strategic partnerships with major automotive OEMs and are therefore very well-placed to understand new EV technologies and their specific tyre requirements as mentioned before. We were there from the start with our exclusive ologic fitment on the BMW i3. EV registrations will continue to grow and Bridgestone will continue delivering best in class rolling resistance tyres to enable this growth.

What will be the major chance we will see in tyres fitted on electric vehicles?

As electric vehicles gain momentum, two of the main areas we’re focusing on are rolling resistance and sound. Because batteries often require a significant amount of space we have reduced the width of some EV tyres, as we have for our ologic tyre for the BMW i3. This reduces the weight and rolling resistance significantly. With electric vehicles producing very little engine noise, the sound of tyres requires attention. There is therefore a greater emphasis in EVs on reducing tyre noise as much as possible. We’re continuing to make advances in both of these areas and are excited about the possibilities.

What are major challenge in Europe and Middle East?

The twin factors of geo-political uncertainty and strong dependence on oil prices in the Middle East are always on our radar. In Europe, we are exposed to some degree to changes in economic and political landscapes but as mentioned earlie, we build flexibility into our plans to deal with these possibilities.
More structurally, the major challenge ahead of us consists in adapting our business model from tire manufacturer to provider of products as a solution in light of an automotive industry which is being transformed significantly by CASE technologies (Connected, Autonomous, Shared, Electric). We at Bridgestone see a significant opportunity as we believe our key areas of strengths (a wide customer base, a controlled retail network and a unique in depth knowledge of tire technologies) will be an asset in this new world.

What are the company’s plans Middle East market? How do you plan to penetrate more OTR products in the region?

We have been growing constantly in Middle East in the past years due to our superior technologies, customised product offering and a strong network of distribution partners. We will keep expanding our products range and collaborating with our distributors to provide a broader range of mobility solutions to our end-users. For OTR, beyond providing some of the best tyres for mining, port, construction applications, we have developed proprietary solutions together with our customers to enable them to optimize the total cost of ownership of their vehicles, reduce downtime and ultimately increase their profitability. This is why we have a large and growing base of OTR customers throughout Bridgestone EMEA.

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