The competition among Bridgestone Corp., Group Michelin and Goodyear for the Top 50 gold medal is turning into a decathlon of events instead of a straight head-to-head marathon. Based on sales revenue, the criterion used for the past 10 years in TIRE BUSINESS' annual ranking of the world's largest tire makers, Bridgestone stands atop the 1995 podium with tire revenues of $13 billion compared with $12.3 billion for Michelin.
But the improvement from 1994 and the sales lead over Michelin resulted mostly from a larger swing in the yen/dollar currency translation than that experienced by the French franc.
Additionally, TIRE BUSINESS now calculates the ``tire concentration'' of Bridgestone's corporate sales at a higher percentage than in the past, following a more complete accounting of the company's tire and tire-related activities.
Depending on the criteria used, Michelin still could be considered the leader of the tire manufacturers ranking for 1995, with Goodyear challenging both.
1) Based on manufacturing output, Michelin has a comfortable lead over both its global rivals, claiming a daily output of 698,000 units vs. approximately 520,000 for Bridgestone and 475,000 for Goodyear.
2) Factoring out the effects of currency fluctuations over the period 1992-95, Michelin would retain the sales revenue title, but only by a slim margin over Goodyear, which would be No. 2 ahead of Bridgestone.
3) Goodyear lays claim to most profitable on an operating basis, 9.3 percent of sales, while Bridgestone edges slightly ahead on net profit, 5.8 percent vs. 4.6 percent for Goodyear.
Goodyear also shows the most consistency in regard to profits, reporting such gains in 21 consecutive quarters.
Looking closely at growth trends reveals a further, intriguing twist on the rankings.
Since 1992, Goodyear's tire sales have grown an average of nearly 8 percent a year, whereas Michelin's and Bridgestone's have actually declined slightly, when calculated in francs or yen, their respective reporting currencies.
Over the same period, the yen has gained 25.5 percent in value vs. the dollar, and the franc has appreciated by 7.3 percent, using
the averaged annual exchange rates as the determining factor.
The gap between Bridgestone and/or Michelin to Goodyear shown in the Top 50 table shrinks somewhat when one includes approximately $400 million in sales revenue from Goodyear's 50/50 joint ventures in Australia (South Pacific Tyres) and Japan (Nippon Giant Tire), which is not reported in Goodyear's fiscal accounts.
As indicated, Bridgestone's position vs. its two major competitors improved over previous rankings partly because of a recalculation of the company's tire concentration.
Bridgestone reports its tire division represents 76 percent of its corporate sales revenue, but the company previously declined to provide further information as to how much ``tire-related revenue'' its retail networks in the Americas, Japan and Europe produced.
TIRE BUSINESS factors out such revenues to focus on each company's tire manufacturing-related sales. In Bridgestone's case this is now estimated to be about 5 to 6 percent of the firm's tire division sales, as opposed to 8 to 10 percent previously, leaving the company's direct tire-derived sales at 72 percent.
In the case of Goodyear, ``tire- related'' sales of more than $1.1 billion include revenues from automotive parts and service, natural rubber plantations and other miscellaneous activities. Bridgestone, Michelin, Continental A.G., Sumitomo Rubber Industries Ltd. and Pirelli Group all have similar revenues that are factored out.
The tire-related share of Bridgestone's tire division sales could increase in the future, however, as Bridgestone ``rededicates itself to asserting strong leadership in the Japanese market,'' President Yoichiro Kaizaki said in the firm's 1995 annual report.
Among the measures Bridgestone is pursuing are:
``Aggressively'' expanding its network of ``high turnover retail outlets'' in Japan, where the company operates more than 350 equity-owned stores;
Giving ``renewed emphasis'' to automotive service and repair as a ``value-added supplement to tire retailing'' at the 1,500 Mastercare and other equity-owned retail outlets in North America; and
Setting up a network of ``Cockpit'' specialty tire stores in Thailand, along with Bridgestone-identified shops in Indonesia.
Goodyear actually has been reducing the size of its tire-related revenue as it turns more and more to franchising and other dealer incentive programs to shore up its retail presence, especially in Europe.
Michelin, on the other hand, reported higher sales from its 1,200-store Euromaster retail network, and said: ``Growth in the sales of wheels, shock absorbers, and other products and services demonstrates the success of this network's diversification initiatives.''
The remainder of the Top 10 reflected status quo, with only one change-Kumho & Co. Inc. reclaiming 10th from Hankook Tire Co. Ltd. on the strength of 27- percent sales growth vs. 1994, when Kumho suffered the effects of prolonged strikes at its Korean operations.
The Top 50 contains five new firms this year, all of them Chinese-Qingdao No. 2, Dong Feng Tire, Chengshan, Shandong Tyre and Hualin Tyre. Qingdao debuts at No. 34.
The ``climber of the year'' title goes to Titan Wheel International Inc., based in Quincy, Ill., which has now consolidated its purchases of former Pirelli Armstrong Tire Corp. and Dico Tire assets. The company reported 1995 sales of $365 million, good for No. 17.
Other climbers of note are India's Birla Tyres, which jumped seven spots to 37th, and Indonesia's P.T. Gadjah Tunggal and Turkey's Brisa Tire, each of which moved three rungs higher, to 20th and 23rd, respectively.
For Brisa, the move is a rebound following a turbulent 1994 when the Turkish lira devalued by 170 percent.
Those displaced from the Top 50 are Israel's Alliance Tire & Rubber, India's Vikrant Tyre, Hungary's Taurus Rubber Co., Carlisle Tire & Wheel of the U.S. and Taiwan's Hwa Fong Rubber.
The addition of the Chinese companies, effects of currency translation and growth by the ranked companies mean the global total of $68.5 billion is measurably larger than in the past.
The previous years' totals also have been revised to accommodate the reshuffling of the Top 50 to include the Chinese companies. The 1995 total is 12.7 percent larger than the revised 1994 global total, which was 11.3 percent larger than 1993.