TOTAL INVESTIMENTS OF 300 MILLION DOLLARS IN THE PERIOD
PIRELLI TYRE AIMS FOR 10% REVENUE GROWTH IN BRAZIL IN THE 2009-2011 PERIOD
PIRELLI ABSOLUTE LEADER IN SOUTH AMERICA
IN THE TYRE INDUSTRY
THE GROUP IS PRESENT IN BRAZIL WITH 5 FACTORIES AND A RESEARCH CENTER FOR DEVELOPMENT AND PRODUCTION OF TYRES FOR THE CARS, MOTORCYCLES, AND INDUSTRIAL AND AGRICULTURAL VEHICLES OF THE MAIN WORLDWIDE MANUFACTURERS
IN THE 2004-2007 PERIOD THE COMPANY INVESTED APPROXIMATELY 300 MILLION DOLLARS IN BRAZIL, WITH 25% GROWTH IN MANUFACTURING CAPACITY AND 21% GROWTH IN SALES REVENUE
THE PIRELLI GROUP EMPLOYS MORE THAN 9,600 PEOPLE IN BRAZIL AND IS INVOLVED IN NUMEROUS SOCIAL, CULTURAL AND SPORTS INITIATIVES
PIRELLI CELEBRATES 80 YEARS OF PRESENCE IN BRAZIL WITH AN EXHIBITION AND EVENT
The Pirelli Group strengthens its presence in South America and continues to invest in Brazil, where this year it celebrates 80 years of industrial and commercial presence. New development plans were illustrated during a press conference held at the manufacturing site of Santo André, in the State of Sao Paulo, and attended by the Brazilian Minister of Development, Industry and Foreign Trade, Miguel Jorge, representatives of local institutional authorities, the General Consul of Italy in Brazil, Marco Marsilli, the Director of Istituto nazionale per il Commercio Estero (Italian board of foreign trade) in Sao Paulo, Giovanni Sacchi, the Chairman of the Pirelli Group, Marco Tronchetti Provera, the CEO and Managing Director of Pirelli Tyre, Francesco Gori, and the CEO of Pirelli Pneus América Latina, Guillermo Kelly.
Investments and increase of manufacturing capacity
Coherently with the 2009-2011 industrial plan, in the three-year period the Group will invest 200 million dollars in Brazil on top of the 100 million dollars already invested last year. This strategy of strengthening in the area will consolidate the leadership of the Pirelli Group in South American markets.
The new investments will allow for a 20% increase in manufacturing of tyres for cars and motorcycles. The 300 million dollars of total investments in the 2008-2011 period will be targeted one third to research and development and the remainder to increasing manufacturing capacity.
In the 2004-2007 period, the Group already invested approximately 300 million dollars in Brazilian factories for technological innovation of the facilities, renewal of the product portfolio, as well as to increase manufacturing capacity, up in the period by more than 25% overall in all the main market segments: car, motorcycle, and industrial, agricultural and off road vehicles.
Between 2005 and 2008, sales of Pirelli in South America grew by a total of 21%, surpassing in 2008 for the first time the threshold of two billion dollars. Brazil‘s contribution to this result amounted to more than 60%, with more than 1.2 billion dollars.
Pirelli Tyre’s growth target in Brazil in the 2009-2011 three-year period is for a total increase in revenues of 10% compared with 2008, despite a 2009 which, as already announced, will be affected by the strong crisis in demand worldwide.
Pirelli in South America
Brazil, where Pirelli has been present since 1929, is one of the fundamental countries for the Group’s growth strategy. This country represents the first automobile and industrial vehicle market in the South American continent, one of the largest markets in the world. Brazil hosts the major automakers, motorcycle manufacturers, and industrial vehicle producers of South America and many of the top manufacturers worldwide.
The strong presence in this market appears particularly strategic in the current phase of world economic crisis, both because the area, driven in particular by the emerging economy of Brazil, has been less affected by the fall in demand, and because it offers a more efficient cost structure and a competitive base for exports.
The industrial and technological heart of Pirelli in South America is the Santo André plant, which became part of the Group 80 years ago and which employs 2,200 people in production of tyres for cars, motorcycles and industrial vehicles. Over the course of time, the industrial and commercial presence and importance of the Group has grown consistently, to the point where today Pirelli is absolute leader in Brazil and in all of South America.
Thanks in part to the Research and Development Center of Santo André, Pirelli’s factories in Brazil are a point of reference for the automobile, motorcycle, and industrial vehicle industries, both for South and for North America. At its Brazilian sites Pirelli in fact produces tyres destined for all manufacturers present in the area including Fiat, Chrysler, New Holland, Iveco, Volkswagen, Audi, General Motors, Ford, Peugeot, Daimler, Honda, Suzuki, Yamaha, Mitsubishi, Toyota, Mazda, Scania, and Volvo.
The technological and industrial hub of Santo André is one of the centers of excellence, at worldwide level not only of the Pirelli Group but of the entire tyre industry. In particular, the research center of Santo André works in a network with Pirelli’s other centers operating in Italy, Germany, the UK, the US and China, utilizing the support of Pirelli Labs. The Proving Ground in Sumaré that extends over 200,000 square meters and has become the reference point for tyre tests and for tests of vehicles of all segments (automobile, motorcycle, agricultural and industrial, SUVs etc.) completes the Santo André hub of excellence.
In 2008 South America represented 33% of overall sales revenue of Pirelli Tyre, equal to more than 4.1 billion euros (more than 6 billion dollars). The position of absolute leadership in South America is expressed both in the original equipment channel, and in all the main replacement markets, in particular in Brazil, where Pirelli can count on a distribution network of more than 600 exclusive points of sale.
Approximately 90% of the South American production of Pirelli Tyre is concentrated in Brazil, of which more than 35% is destined for export, including towards NAFTA area markets (the United States, Canada, and Mexico) for products with high technological content.
Currently, out of the 23 factories overall in the Pirelli Tyre Group, 7 are in the South American continent and are destined for production of tyres for cars, industrial vehicles, motorcycles, agricultural equipment and earth-moving and construction equipment. Five factories are in Brazil (Feira de Santana in the North of the country, Santo André, Sumaré and Campinas in the state of Sao Paulo, Gravataì in the South), one in Venezuela, near Caracas, and one in Argentina, near Buenos Aires. The headquarters of Pirelli in South America is in the city of Sao Paulo.
Overall, employees of Pirelli Tyre in South America count about 11,400 of which more than 9,600 in Brazil.
Social, cultural and communications activities of Pirelli in Brazil
The eighty year anniversary of Pirelli in Brazil is being celebrated with an exhibition and event entitled “80 years of history. A way to leadership
“ which reflects back on the history of the Group in Brazil in all areas Pirelli is involved in. Industry, first of all, but also sports, communications and social and cultural activities, which have left their mark on the collective memory of the nation and have often crossed over into other countries. Such is the case of the famed advertisement depicting Ronaldo on the Corcovado, and of the Calendar, often set in Brazil and which will again have Brazil as its backdrop in the forthcoming edition.
The photographs of ‘The Cal 2010′, taken by American photographer Terry Richardson, were shot in May in Trancoso, in the state of Bahia.
Coherently with the philosophy of the Group, which operates everywhere in the world and interacts and integrates with local communities, in Brazil too Pirelli promotes numerous initiatives in support of culture, social work and healthcare, education, training, and sports.
In the area of social welfare, the initiatives sustained by Pirelli in collaboration with local and central governing authorities cover various areas. In particular, the Group supports many projects helping recuperate and reinsert into society hundreds of disadvantaged children and adolescents all over the country, as well as programs in education, professional training, and civic education. There are many projects in healthcare, such as vaccination campaigns against epidemics typical of the tropical area, and information and sensitivity campaigns.
In Brazil, Pirelli’s research focuses on sustainable development, in line with the Green Performance targets announced in the 2009-2011 industrial plan. In particular, the Group has a commitment with local authorities to acquire all the natural rubber produced with eco-sustainable methods in the Xapuri region, thus contributing not only to preservation of the region’s environment, but also to economic development of the native populations according to local traditional culture. Pirelli also supports the national Brazilian program for recycling used tyres.
In addition to sponsorship of motor sports, often as single supplier (in total, 17 championships, including the Brazilian Superbike, rally and Gt3), Pirelli has also sponsored the Palmeiras soccer team, one of the top soccer clubs in the country, 4 times champion in Brazil and once in South America. Until the ‘80s, Pirelli was active in sports with the Clube Atlético Pirelli which counted many successes both at home and internationally in volleyball, boxing, judo and cycling.