Bridgestone Expands International Manufacturing Capacity

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Researched by Industrialinfo.com (Industrial Information Resources, Incorporated; Houston, Texas). Over the past few months, Bridgestone Corporation (NYSE:BRDCY) (Tokyo, Japan) has announced plans for several new plants in various locations around the world. Plans call for construction of plants in Central America, Central Europe, and China. In addition to the new plants, the company has several expansions in existing plants currently under construction.

Bridgestone Firestone de México SA de CV (Mexico City, Mexico), a division of Bridgestone Firestone North America Tire LLC, a subsidiary of Bridgestone Americas Holding, Incorporated, (Nashville, Tennessee), has begun construction of its new plant in Monterrey, Nuevo León, Mexico. The new plant will be operated by a newly-formed sister company, Bridgestone Neumáticos de Monterrey SA de CV.

Bridgestone has selected Shimizu Corporation de México SA de CV (Tijuana, Baja California), a division of Shimizu Corporation (TSE:1803 ) (Tokyo, Japan), as the general contractor for the plant. The $220 million plant will be located on a 78-hectare site. The company held a ceremonial ground breaking on April 20, 2005, with actual construction following several weeks later. The plant is expected to be operational in July of 2007. The plant will produce high performance, ultra-high-performance, and large rim-diameter passenger and light truck tires, mostly for the North American tire market, and will have a production capacity of approximately 8,000 tires per day and employ 200 people. This will be the company's third tire plant in Mexico, complementing other plants Bridgestone Firestone de México operates in Mexico City and Cuernavaca.

The plant will be Bridgestone's first installation of its new tire production system called, BIRD, outside of Japan. BIRD is an acronym for Bridgestone Innovative and Rational Development. The system automates the entire manufacturing process, from the processing of materials to the inspection of the finished tires. The first installation of BIRD took place earlier this year at the company's plant in Hikone, Japan. BIRD is capable of producing several different types and sizes of tires simultaneously, allowing for great flexibility and the ability to be responsive to customer needs.

The company is planning its fourth plant in China, to be located in Huizhou, Guangdong province. The $300 million plant is expected to begin production by January of 2007 and reach full capacity in 2009, producing 5,000 tires per day and employing 1,000. This plant is expected to supply tires to Toyota Motor Corporation, Nissan Motor Corporation, and other major automakers located in the province. Bridgestone is also expanding production capacity for truck and bus tires at Shenyang Plant in China.

Bridgestone has also announced plans to construct a 190 million euro ($230 million) tire plant Near Tatabánya, Hungary, the first European installation of BIRD technology. Construction is expected to begin in 2006, with production following in 2008. When the plant reaches full capacity, in the first half of 2009, it will produce 8,000 tires per day. This will be Bridgestone's second plant in Central Europe, after the plant in Poznan, Poland, which began production in 2000. The Poland plant added capacity to manufacture high-performance tires, tires of large rim size and "runflat" tires. In 2004, the Poznan plant became the first Bridgestone plant outside Japan to produce "runflat" tires.

In South America, the company will invest $160 million in Camaçari Industrial Pole in the Brazilian state of Bahia. Construction began in 2005, and Bridgestone expects the plant to begin production in the second half of 2006. The 500-employee plant will have a daily production capacity of 8,000 tires for passenger cars and light trucks. It will complement the company's 65-year-old plant in Santo André, São Paulo, which makes tires for passenger cars, trucks, buses, agricultural machinery, and earthmoving equipment.

Expansion is also underway at passenger tire plants in China, Thailand, Indonesia, South Africa, and Costa Rica. Other investment projects are expanding production capacity for truck and bus tires at plants in Japan, Spain, Brazil, and elsewhere. Bridgestone is also expanding capacity at its Hofu Plant, in Japan, which produces small and medium-sized off-the-road tires.

Aside from its passenger car and truck business, Bridgestone also supplies tires to most of the world's leading commercial airlines and aircraft manufacturers. In the fall of 2004, Bridgestone was selected to supply tires for Boeing Company's new 787 Dreamliner family of airliners. Boeing expects the Dreamliner to enter into commercial service in 2008, and Bridgestone will begin delivering Dreamliner tires in 2007. Bridgestone is the only company that Boeing has contracted to supply Dreamliner tires as standard equipment. Boeing also equips other aircraft with Bridgestone tires.

Airbus S.A.S. offers Bridgestone tires on all of the aircraft models it produces, and Bridgestone has been selected to supply tires for Airbus's upcoming A380 jetliner. The A380, the largest commercial airliner ever, will go into service in 2006. Bridgestone is also investing in its testing facilities worldwide. Bridgestone intends to expand its new proving ground in Italy. The next phase of construction will add tracks and facilities for wet-surface and other testing in 2006. Currently, there is a 2.5-mile oval track for high-speed testing. The proving ground also includes sections for evaluating comfort, pass-by noise, and cornering.

The Bridgestone Group of companies reports it is "expanding production capacity around the world to more effectively service this growth in demand and it is committed to building plants as necessary to support its global sourcing strategy and fulfill the needs of its customers." Bridgestone’s tire production volume worldwide has increased an average of 4% a year over the ten years to 2004, and it expects to increase its production capacity at about that rate from 2005 to 2008. Bridgestone is aggressively positioning itself to serve the growing demand for passenger car tires in emerging markets. Once the new plants are complete, Bridgestone will have 51 tire plants in 24 countries.

Shojiro Ishibashi created Bridgestone Tire Company Limited in 1931. The company was renamed Bridgestone Corporation in 1984. He fashioned the company name by reversing the English translation of his own name, Ishibashi, which literally means "stone bridge" in Japanese. Bridgestone Corporation is the world's largest manufacturer of tires and other rubber products. Tires account for 80 percent of Bridgestone Group's sales worldwide. Bridgestone develops, manufactures, and markets tires for almost every kind of vehicle. The company sells more than 8,000 different types and sizes of tires, from a 13-foot-tall giant radial for earthmoving equipment to a kart tire that stands only ten inches high. The company also manufactures industrial rubber and chemical products, sporting goods, and other diversified products. It sells its tires and other products in more than 150 nations.

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