According to the company, it is the first Chinese tire maker “to go completely green.”

At a recent gathering in Jiaozuo, China, Aeolus Tyres Vice President and General Manager Wang Feng unveiled a number of important developments. “Aeolus has declared that it accepts its responsibilities to future generations,” he said.

“We want to make the greatest possible contribution to a clean environment, achieve resource savings and offer the highest possible quality and safety with our products. After all, our motto is ‘Building a Better & Green Future,’ and that is what we believe in. We will be demonstrating that every day from now on.”

Feng says his company’s production is truly green’ and sustainable.

“We are doing that in a way which has earned us the waste zero emission label. We produce the tires themselves with no toxic substances, and by making the most efficient possible use of resources.

“In terms of technology, we have been working closely with Goodyear for some time. Their expertise is helping to achieve our objectives. We want to continue to develop into a tier two brand over the coming years.”

As the host of the gathering, Feng welcomed senior executives from the Chinese rubber and chemical industries and from Goodyear Tire & Rubber Co., together with the main importers from Europe and the United States.

“We have been working with Aeolus for many years, and are delighted with the new progressive approach which the brand has adopted in terms of its production methods,” says Jan Heuver, managing director of Heuver Tyrewholesale (Netherlands). “That will help to strengthen the brand enormously in all the European countries where we are the exclusive importer.

“There are not many brands which can already offer ‘green’ production. At the same time, Aeolus is able to maintain its value for money proposition.”

n order to achieve its “green” goals, Aeolus Tyres has focused on raw materials and their processing; the production process, specifically the use of lower temperatures and the reduction of dust; and new tire profiles and lower tire weight.

Aeolus Tyre is part of ChemChina, one of the world’s largest companies. In the United States, the Aeolus brand is distributed by Alliance Tire Americas Inc.

Source : http://www.moderntiredealer.com/News/Story/2011/08/Aeolus-Tyre-goes-green-in-China.aspx

The system tracks and identifies all components in the factory using a barcode system. This helps to track energy consumption and also to track quality. The first trials were carried out in January 2010

Since April 2011, this production based system has been integrated with a on-vehicle fleet tyre management system system using GPS as a way to understand better how the tyres are used in service.

Source: http://www.european-rubber-journal.com/fullitem.aspx?id=115883

Source : http://www.tyrepress.com/News/51/China/22558.html

Even though tyre companies have revised product prices twice in the past six months, the net impact on the operating margin is not huge due to the high differential between the product and the raw material costs. So, tyre companies may continue to face pressure on the operating margin in the coming quarters with the expected increase in rubber prices.

MRF sales grew by 34% over the quarter ended March ’11, with improved demand in the passenger cars and commercial vehicles, which contributed less than half to the volume beside improvement in replacement demand. This segment grew by 18% for the similar period on year on year basis. But profitability was dented by almost two folds increase in the raw material cost, which accounts for threefourths of the total operational cost. Operating profit grew by 10% to Rs 234 crore, which is higher than the previous quarter. Although raw material cost is up 51%, moderation in other operational costs has resulted in growth in the operating profits.
With an increase in outlay in interest and depreciation costs, MRF net profit has declined by 6% in the same period. Rubber prices shot up by 40% to Rs 56/kg, which has resulted in contraction of operating by 200 basis points.

According to the Rubber Board of India, natural rubber production is expected to be 9 lakh tonnes compared to consumption of 9.7 lakh tonnes in the year ended FY11, which can augment the pressure on rubber prices in the coming quarters. Further, with a rise in inflation cost, the cost of owing a vehicle may increase, which can dent automobile demand in the coming quarters.

Being a segment leader, with high market share in commercial vehicle , the company can sustain the growth momentum in the coming quarters. So, an investor can take a wait and watch approach for MRF as well as other companies in this industry and keep a tab on rubber prices to take the exposure in the tyre stock in the near term.

Source: http://economictimes.indiatimes.com/markets/stocks/stocks-in-news/with-high-market-share-in-commercial-vehicle-mrf-tyres-can-sustain-growth/articleshow/8768337.cms