5th meeting: 11am, 5th Nov 2010, Coffee Bean Bugis

INDUSTRY:

• Future outlook and trends: The global tyre market was forecasted
to grow at a rate of >3.0% per year. European tyre manufacturers account
for the largest share of 29.5% of the worldwide market. Asia-Pacific occupies
the fastest growing tyre market, recording a CAGR of 6.85% during the period
2001-2010. Global market for light trucks replacement tyres is expected to
reach 188 million units in 2010 (Tire Industry Association, 2008).
• Parent Company’s history:

Italmatic is the leading manufacturer of tyre retreading equipment and

accessories in the world. Italmatic head office is located in Milano, Italy. It has
manufacturing plants in Lucca and Pisa.

Since the 1990s, Italmatic has been supplying presses and extruders for the
production of new industrial tyres to tyre manufacturers in Europe. In 2001,
Italmatic introduced a new line of industrial tyres under the “Comfort” brand
for the European market. Its market has grown tremendously and the plants
have reached their full production capacity of 40,000 per year.

In 2004, Italmatic started to look for a partner in Asia to start a second line of
production to produce solid tyres and double its capacity to cater to the
increasing demand in Europe. The main players of industrial tyres in the
world are Dunlop, Michelin, Yokohama, Continental, Aichi, Solideal, etc.

The production capacity is around 10 million units worldwide, with Europe

taking about 20% or 2 million of the total.

• Market segmentation: the segments Ayara targets are light industry

vehicle manufacturers (e.g. Mitsubishi, Hitachi), logistics and warehousing
companies in Singapore (e.g. Axis, Buds and Buds, SembCorp).

• Competition analysis: In respect of close competitors, there are

many companies in Shandong and Jiangsu of China currently going into the
same segment and producing solid tyres for forklift. However, those Chinese
manufacturers are using recycled rubber for their first-hand tyres production
whereas Ayara uses pure rubber for its products. Product quality is a
competitive advantage for Araya in the market.

• Industry and market forecast: Ayara is aiming to a bigger market

which are global forklift manufacturers. According to the Industrial Truck
Association (ITA) (Rogers, 2010), the lift truck industry was down 39% in
2009, but the figures started to show an increase this year. The combined
2009 revenue for all Top 20 companies was $20.17 billion, but in the
quarterly report of April 2010, ITA member companies declared a 15% growth
over 2009. This is in fact a potential market to go in, and targeting customers
of Ayara are big companies such as Toyota, Mitsubishi, Kion, etc.

REFERENCES:
Rogers, Lorie King (2010), ‘Lift Truck Suppliers’, Modern Materials Handling, Aug vol.

Tire Industry Association (2008), ‘Global tire market’, accessed on 8 November

2010, available at http://www.tireindustry.org/press_releases.asp
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