• NEW “PREMIUM” FACTORY STRENGTHENS NAFTA AREA PRESENCE
• IN 2014, 66% OF PIRELLI’S NAFTA AREA REVENUES WILL BE PREMIUM
• PRODUCTION OF 3.5 MILLION PIECES BY 2015, RISING TO 5.5 MILLION WHEN FULLY OPERATIONAL IN 2017
• FACTORY AT HIGHEST LEVEL IN TERMS OF REDUCTION OF ENVIRONMENTAL IMPACT
Silao, Milan, 31 May 2012 – Pirelli today inaugurated a new factory in Mexico, in Silao, in the state of Guanajuato. The inauguration saw the participation of Mexico’s President, Felipe Calderón Hinojosa, and the Chairman and CEO of Pirelli, Marco Tronchetti Provera, together with the Governor of the State of Guanajuato, Héctor López Santillana, Mexico’s Minister for the Economy, Bruno Ferrari, the Mayor of Silao, Juan Tovar Torres, the Director General of ProMéxico, Carlos Guzmán, and Italy’s Ambassador to Mexico, Roberto Spinelli.
The new plant, Pirelli’s first in Mexico and the 22nd tire plant worldwide, is mainly focused on the Premium segment, producing High Performance and Ultra-High Performance tires for cars, and SUVs for the local and all Nafta area markets. The factory covers an area of 135,000 square meters and its capacity will reach 400,000 pieces by the end of this year, rising to 3.5 million in the first phase of development which ends in 2015. When fully operational in 2017, production is expected to be 5.5 million pieces.
Pirelli’s investment, already included in the industrial plan, will be around 300 million dollars from 2011 to 2015. By 2017 a further 100 million dollars will be invested for an estimated total of around 400 million dollars. The new Pirelli plant, which is equipped with the group’s most advanced technology and production processes, will create about 1,000 new jobs by 2013: 700 direct positions with the group and 300 external positions. When fully operational, the plant will add a further 700 direct employees and 100 indirect, for a total of 1,800 jobs.
Pirelli Chairman and CEO Marco Tronchetti Provera said: “The opening of the new factory in Mexico represents an important step in our international development plan. This is a country that offers excellent opportunities both because of the positive dynamic of local demand and its strategic position, making it an ideal industrial base to serve the entire Nafta area, which we think one of the most promising for the success of our Premium strategy.”
In line with Pirelli’s strategic focus on the Premium segment, in which the group aims to achieve world leadership in 2015, the production from the Silao plant will be mainly high-end and very high-end (Car and SUV) and will serve the entire Nafta area: 30% of production, in line with Pirelli’s local for local strategy, will serve growing Mexican demand, while the remaining 70% will go to the USA market and to a lesser extent Canada.
The new factory will augment the factory the group already has in the Nafta area, in Rome, Georgia (Usa), specialized in production using MIRS technology, which has an annual output of 400,000 pieces so that Pirelli’s total production in the region in 2015 will be 3.9 million tires, rising to 5.9 million pieces in 2017. This will result in a decided strengthening of the group in this geographic area: thanks to the new factory, in fact, Pirelli will be able to increase its capacity to satisfy Nafta area demand through local production which in 2011 accounted for 6% and will rise to 11% in 2012 and finally reach 53% in 2015. The new factory in Mexico will also deliver a reduction in logistical costs, offer more efficient customer service, lead to lower imports from Brazil and free-up production capacity there which today serves the Nafta area, allowing Brazilian production to focus on the Latam area.
In the Nafta area, the tire market in the Car segment is seen growing by an average 2.1% per year to 361 million pieces at the end of 2015 and represents an opportunity for Pirelli’s international development, above all taking into account that the Premium segment is expected to grow at an average annual rate of 6%. As indicated in its industrial plan, Pirelli’s revenues in the area will amount to around 710 million euro in 2014, with an average annual growth rate from 2011 of 7.1% and will equal over 9% of total revenues at the end of 2014.
In particular, in 2014, 66% of Pirelli’s revenues in the area will come from the Premium segment (30% Medium segment and 4% Standard), a marked increase from 55% (36% Medium and 9% Standard) at the end of 2011.
In line with the strategy of constant technological innovation at Pirelli’s sites – which in 2015 will mean that 60% of production will come from factories/facilities under 10 years old – and the group’s commitment to sustainability, the new factory in Mexico is, together with the hub at Settimo Torinese, one of the most technologically advanced and was built with great attention to the reduction of its environmental impact both in terms of processes and products. In the new plant expected production will entail a great commitment to the production of tires in line with Pirelli’s “green performance” strategy, which is to say tires that combine road performance with the containment of environmental impact in terms of lower rolling resistance – which means lower fuel consumption and noise reduction.
Right from the planning stages, environmental and energy themes were given great attention at the Mexico plant, which led among other things to the creation of a center for the treatment of residual water to optimize consumption. A series of state-of-the-art sensors have also been installed throughout the factory to reduce to a minimum the wastage of water and electrical energy. In order to preserve the environmental balance, Pirelli also transplanted to the area around the factory all the trees that were uprooted for its construction. The characteristics of the site will therefore make a significant contribution to the achievement of the environmental sustainability goals Pirelli has set itself in the industrial plan presented last November in London and which call for a reduction by 2015 of 70% in the specific consumption of water compared with 2009, a 15% improvement in specific energy efficiency and the reduction also by 2015 of specific CO2 emissions by 15%.
The “Inter Campus Pirelli Silao” programme launched
With the inauguration of the Silao factory, the “Inter Campus Pirelli Silao” project takes off. The F.C. Internazionale project, with the support of Pirelli, will offer the children of the area a meeting point where they can play sports, in particular soccer. In the first two years, the “Inter Campus Pirelli Silao” program will be to the benefit of children of the “Casa Hangar Peter Pan” Foundation (about 65 have already participated in the preliminary phase of the project), as well as around 150 children of employees of Pirelli’s production plant in Silao.
Pirelli will act as patron and guarantee sporting activities at Silao, drawing on the technical skills of the Inter Campus staff and its educational experience developed in the 24 countries in which it is active. Inter Campus trains the local educators through special courses and supplies all children participating in the program with the technical material needed for the sporting activity, including the blue and black Inter outfits, sponsored by Pirelli. In the first two years, the aim is to involve 200 children and train five local educators to manage the activities using the Inter campus methods.
The program was presented last August to the Governor of Guanajuato who appreciated the social aims of the Inter campus project. The reclamation of the area near the Pirelli plant will benefit the children participating in the project, as well as developing the social context of Silao city.
Founded in 1872, Pirelli is the fifth tyre maker in the world in terms of sales. Present in over 160 countries, at the end of the first quarter of 2012 it counted 21 tyre production sites in four continents and employed circa 36,000 people. Pirelli is a leading producer of high and very high end tyres, thanks to its commitment to R&D, an area in which it annually invests around 3% of total revenues (5.6 billion euro in 2011) or 7% of Premium segment revenues, among the highest levels of the tyre industry, with the aim of constant improvement in terms of performance, safety and containment of environmental impact. Present in sporting competitions since 1907, Pirelli is the exclusive supplier of the Superbike world championship and the most prestigious single marque championships, but above all it is the sole supplier for the Formula 1 championship for the 3-year period 2011-2013.