Cooper aims to lead tire production in China

10/6/2004

Findlay's Cooper Tire & Rubber Co. not only plans to make tires for Chinese cars and trucks, it aims to dominate the market expected to become the biggest in the world.

Cooper Tire, which is building a joint-venture factory to make tires for North America and Europe, is studying the Chinese market and acquisition opportunities there in hopes of selling more than $1 billion worth of tires annually in three to 10 years, Thomas Dattilo, chairman and chief executive officer, told The Blade yesterday.

No tire manufacturer dominates the China market now, and Cooper Tire plans to incorporate the same strategies it uses in North America, such as focusing on customers, developing brands, and manufacturing efficiently, Mr. Dattilo said. The tire maker plans to introduce its brands in China and is likely to help build their equity by supplying tires to automakers, which it doesn't do in North America, he said.

"We plan on being a significant player in the tire market in China, and we believe we have the formula," Mr. Dattilo said. "Everybody is equal - in an emerging market, everybody is equal."

Those more than 10 million tires a year would give Cooper Tire a market share in the mid-teens in China, the CEO said. By comparison, the Hancock County company sells more than 40 million tires a year in North America, where it has more than 20 percent of the replacement-tire market for light trucks and close to that number for cars and is expanding its manufacturing capacity.

The business potential in China is huge, Mr. Dattilo said. China has 1.3 billion people but just 20 million cars, vans, semi-trucks, buses, and other vehicles. China has an estimated eight cars for every 1,000 people, compared with 940 per 1,000 in the United States.

As the Chinese continue to become more affluent, the company chief said, the number of vehicles will increase - along with the number of tires they need.

Cooper Tire plans to expand in China through acquisitions, Mr. Dattilo said. The Findlay tire maker also is looking at emerging markets in India, Russia, and Eastern Europe, he said.