DETROIT (Sept. 17, 2004) — Cooper Tire & Rubber Co.'s top executive envisions Cooper becoming the largest tire maker in China in five years with sales of more than $1 billion.
Speaking at a Reuters Autos and Manufacturing Summit in Detroit, Thomas Dattilo, chairman, president and CEO, said Cooper's goal is to achieve a market share in China of 15 to 17 percent through acquisitions and expanding its existing business there.
Cooper soon will have more cash on hand to pursue this goal, after announcing Sept. 17 a deal to sell its Cooper Standard Automotive business for nearly $1.2 billion.
Cooper currently has little if any market presence in China. In the past year it has struck three deals to have tires made in China for sale in North America and Europe, but up to now it has not spoken openly about plans to sell tires in China.
The largest tire companies in China now are Triangle Group Co. Ltd., Grandtour Tyre Pte. Ltd. and Shandong Chengshan Tire Co. Ltd., each with sales in excess of $500 million. In addition, most of the world's major international tire companies—Group Michelin, Bridgestone Corp., Goodyear, Sumitomo Rubber Industries Ltd., Yokohama Rubber Co. Ltd., Hankook Tire Co. Ltd. and Kumho Tire Co. Inc., Toyo Tire & Rubber Co. Ltd. and Cheng Shin/Maxxis International—already have manufacturing and distribution companies in China.
Cooper struck two deals in the past year with Hangzhou Zhongce Rubber Co. Ltd. to make all of Cooper's radial truck tires and up to 1 million radial passenger tires a year. Hangzhou Zhongce posted estimated sales of $325 million last year.
Cooper also is working with Taiwan's Kenda Rubber Industrial Co. Ltd. to build a $200 million passenger and light truck tire plant in China for the production eventually of 10 million tires a year.
Mr. Dattilo did not elaborate on Cooper's acquisition plans in China, saying only that China is a “quickly emerging market,” according to a Reuters story.