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KEEP EAR TO THE GROUND

KEEP EAR TO THE GROUND

By TA News Bureau:

For Netherlands-based manufacturer of premium off-the-road, industrial, port handling, agriculture and truck tyres, the only constant is change. Its CEO Michael de Ruijter keeps his ears to the ground listening to what the customer demands and quickly adopts products to the market demand. It is this customer-centric policy that has made his company evolve from a specialist rubber compound producer to a leading tyre manufacturer with 12 sales offices worldwide and a market spread out across 130 countries. In this interview to Tyre Asia, the CEO speaks of his vision and the market trends for speciality tyres

The Magna Tyres Group of Netherland has emerged as one of the largest tyre makers in the speciality segments of mining, construction, port handling and industrial purposes. What drives its speedy growth is CEO Michael de Ruijter’s strategy of quick and short decision-making and flexibility in manufacturing to fulfil the requirements of the customer. This he describes as Magna Tyres’ culture of “doing things our own way.”
Surveying the global tyre market, he says in an interview to Tyre Asia that companies around the world are continuing to feel the impact of increasing prices of raw materials and the added pressure of rising demand.
“The world economy is performing well which has resulted in many companies putting an even greater pressure on their mining operations and equipment assets in order to increase revenue by increased production,” he says.
The emphasis today is on increased production which makes choosing the right tyre supplier very important. The aim is to reduce the cost on expenses of tyres and thereby optimize profitability.
This strategy also helps reduce damages and downtime and thus prevents production losses. It also results in guaranteed delivery of the necessary tyres and thereby averting production disruption.
“This can only be realized by opting for premium quality from a reliable tyre supplier. Magna Tyres Group offers a product that optimizes cost-per-hour without compromising on quality, something the three major A-brands are struggling with and aren’t able to deliver in many cases,” asserts de Ruijter.
“We position ourselves as the ‘premium second tier’ tyre brand and provide end-users similar quality as the Tier 1 tyre brands. This sounds too good to be true, but almost all users who have tried MAGNA have become loyal customers,” he says.
Magna is now the fastest growing OTR tyre company in the world, with a proven track record and many successful references worldwide.

Rising demand

Referring to customer demand, de Ruijter says there are certain sizes that are showing demand surges in recent times. “Since early this year, we have seen a huge increase for giant tyres in sizes 27.00R49,33.00R51, 40.00R57 and 46/90R57, which are used on rigid dump trucks in all the major mining operations worldwide.”
In the more common sizes 20.5R25, 23.5R25, 26.5R25 and 29.5R25 for loaders and ADT’s, the demand has also increased.
“Our focus has always been on mining and construction but since the past few years, the demand has also grown enormously towards our industrial tyres. These are applied within port handling applications for reach stackers, container handlers, terminal tractors and straddle carriers, for example 14.00-25, 18.00-25, 310/80R22.5 and 16.00R25.”
The industrial segment is also growing within the recycling and waste segment for which Magna Tyres offers a broad super solid tyre range.
With the projected growth in the construction and mining sector globally, particularly in China and India, Magna Tyres has developed strategies to spread its wings.
“Our vision and business concept is very simple, we listen to our customers and focus on customer needs,” says de Ruijter.
“We have worked with the feedback from our customers and have, therefore, started a local branch located in Singapore which is our regional office for the Asia market.”
Thus Magna Tyres ensures that it is close to the customers locally and delivers the quality they require. As for growth market in Asia, its focus is mainly on India where it has just started to enter. “We will have a substantial market share in the mining and port sector in 2019 based on recently signed long-term distribution contracts,” he points out.
Brand perception
When asked why Magna Tyres describes itself as the top “premium second tier” tyre brand in spite of its great reputation for quality and competitive best cost-per-hour, de Ruijter says from people’s perception the “big three” are considered different.
“In the last few years the market has started to recognize Magna as an A-brand. We have a great reputation for quality and we provide a very competitive cost-per-hour.”
Nevertheless, the Big Three brands in earthmoving tyres will always be a different brand level in most people’s perception. “To achieve similar levels of brand awareness we need time, let us say the next 50 years. Until then we stay number one 2nd tier brand in the world.”
When asked how Magna Tyres would expand its OEM share, de Ruijter said his company has already put a cap on it. “We are currently selling to most of the major machinery manufacturers. With new deals coming up soon, we decided to cap our OE business at 30 per cent.”
This philosophy is important to remain a reliable partner for the aftermarket and also to guarantee the independence as a privately-owned company. “Nevertheless the increasing demand from OEM has reached a level today which we have never seen in our 13 years of existence.”
Commenting on the role he sees for retread in the OTR and off-highway tyre segment, the Magna Tyres chief said that there would always be market for OTR retread and specially for unique sizes and tread designs.
“This market will not grow but can be filtered to this niche in retreading. Which gives us a chance to make good margins and make a big difference and produce tailor made products.”
With the commissioning of a brand new facility in Hardenberg, Magna Tyres is planning to expand its line of products. “The main reason we bought this facility is not for retreading, but to building brand-new earthmoving tyres,” de Ruijter said.
Production at the new plant had begun in February 2018. “We are currently producing 1000x Magna 29.5R25 MA02, 1000x 26.5 M-Terrain, 26.5R25 MA02, 1000x 23.5R25 MA02, 1000x 24R20.5 AG23 and 24R20.5 AG24.5.”
The vision of de Ruijter is to make tyres that his customers demand as quickly as they want. For that he listens to their requirements with rapt attention.

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