Regional strategy: NAFTA


NAFTA
LATAM
EUROPA
MEAI
RUSSIA
APAC


Market overview

In 2013, economy has started recovering in the NAFTA countries, with an average GDP growth rate of 2.8% per year (vs 1.3% in Europe).


Vehicle parc

Gradual recovery of car registrations, with an average growth rate of 1.7% per year between 2013 and 2017.

Premium and Prestige are the segments with the highest potential with a CAGR OF 5.7% in the 2013-17 period, three times higher than the overall market, also due to the progressive shift of car makers towards the top of the range.



Tyre market

Strong growth of the Premium Replacement market, which is expected to grow at a rate 5 times higher than the total market (6.3% CAGR 2013-2017 vs. +1.6%), due to the evolution of the car parc of the Region.


Strategy

Pirelli in NAFTA


  • Player with a strategic positioning in the top of the range (Premium >17” and Superpremium >18”), both in the Replacement channel, due to an increasingly specific commercial offering for the local market, and in OE, through targeted partnerships with Premium OEMs (market share of around 10%);
  • Distribution focus on Premium;
  • 2 plants currently meet 30% of demand: one in the United States (Georgia), using Pirelli MIRS technology for Ultra High Performance and OE Tyres, and the other recently built in Mexico according to high technology standards and now in the ramp-up phase, with 1.2 million pieces produced in 2013;
  • 11% is the Region’s contribution to the Group’s revenues.

TARGET: GROWTH AND BETTER POSITIONING BY FOCUSING ON PREMIUM AND SUPERPREMIUM AND LOCAL-FOR-LOCAL STRATEGY


  • Further push on Premiumv and Superpremium, the two segments growing two or three times faster than the overall market (Car Replacement 3x vs. market);
  • Leveraging R&D and local production capacity for the development of a product portfolio characterised by a shorter time-to market, with an increasing portion of Premium products and a greater orientation to local needs and requirements (Nafta–focused products): more than one new NAFTA-specific product will be launched every year between 2013 and 2017, 45 new rim sizes for the Replacement channel to be introduced in 2014;
  • Strengthening of our positioning in the OE channel (market share of OE Premium and Prestige of around 14% in 2017; +6 pp vs. 2013) and maximum OE Pull-Through through marketing partnerships with OEMs and dealers, dedicated commercial offerings, full use of geomarketing tools for market segmentation;
  • Selective development of the current distribution channel to make our presence noticed in the areas with the highest Premium potential and development of new channels, such as that online;
  • Boosting of the marketing activity by leveraging the Brand and with investments in digital channels;
  • Use of Geo-marketing for an effective and focused segmentation of our offering over the territory;
  • Increasingly, “Local for Local”: by 2017, 60% of demand will be met by local production, as against around 30% in 2013, through the ramp-up of the plant in Silao, Mexico (5 million pieces planned for 2017, +316% vs. 2013), with benefits in terms of efficiency (supply chain), flexibility (product range) and quality of customer service (95% fill rate).

2013-2016 Targets

 


 

Last revised: 19 Dec 2013