Continental to invest 25m euros

Tyre maker Continental Automotive has set out to boost the production capacity of its Timisoara-based factory by nearly 12% in 2006. Some 25m euros have been allocated in order to attain this goal.

The company”s officials say that this investment will enable the company to make 12.5 million tyres next year, compared with the 11.2 million estimated for this year.

“The potential of the market is huge, with two major growth avenues. The first would be the elimination of the second-hand tyre trade in Romania, which amounts to 800,000 units in 2005. The second growth factor will be the winter tyre market. At the moment, the output is divided 80%-20% between summer and winter tyres, but considering the geographic peculiarities of the country and the number of new cars sold, this ratio should be somewhere around 50-50%,” Martin Zaloudek, the head of the sales unit of Continental Automotive Romania told ZF TRANSILVANIA.

The German group has been operating in Romania for five years, and made its first mark on the market by opening its car tyre division in Timisoara, involving an initial investment in excess of 100 million euros. Since then, they have invested approximately 70 million euros in the factory to boost its production capacity.

The factory makes 13 to 16″ (32.5- 40cm) diameter tyres, which can be used at speeds of up to 240 km/hour.

Besides the group”s premium brand, Continental, the other brands manufactured at this facility are Barum, Uniroyal, Mabor, Semperit, Gislaved, Viking and a series of other brands exported to the European and United States markets.

“Our product portfolio includes some 1,200 products, with 750 of these being made in Timisoara this year, 308 more than last year,” Zaloudek said.

Continental has produced more than 30 million tyres in Romania until now, with clients including carmakers such as Renault-Dacia, Fiat, Suzuki, Volkswagen and Toyota.

Tyre market

@ Number of tyres made in Romania last year: 12.6 million, over 90% produced by Continental and Michelin

@ Number of tyres made by Continental in 2004: 9 million

@ Expected tyre output: over 13.4 million in 2007, some 14.3 million in 2009

@ Tyre consumption per capita: 0.21%.

Source: Chamber of Commerce and Industry