NEW ORLEANS (April 28, 2005) — Bridgestone/Firestone delivered on its promise to its parent company that it would make progress and make money in 2004, Mark Emkes, chairman and CEO of Bridgestone Americas Holding Inc. (BAH), told dealers at the company's Bizcon 9 commercial meeting in New Orleans.
BAH reported net sales of $9.15 billion for 2004—a 12-percent increase over 2003. Profit after tax was $183 million in BAH, whose parent is Bridgestone Corp. The results stemmed from several factors, Mr. Emkes said, including growth in passenger and light truck tire unit sales in the replacement market, strong unit sales in truck and bus tires and robust sales in diversified products, Latin America and retail.
He said the company also recorded “significant brand and product mix improvements as the Bridgestone brand demonstrated another year of continued growth and as Firestone continued to recover.”
But Mr. Emkes added that many “delicate issues” continue to be discussed between the tire maker and the United Steelworkers of America (USWA) as the union seeks a new labor agreement.
“Our goal at Bridgestone/Firestone North American Tire (BFNT) is to get an agreement that benefits both parties,” he said. “However, what we won't do is anything that jeopardizes the long-term future of this company. I'd like you to know that whatever happens, we'll use every global resource to support your business.”
Singh Ahluwalia, president of BFS commercial products, truck and bus tires, also addressed a number of goals for BFNT in the commercial sector. One “critical” goal for 2005, he said, is to hit breakeven following a loss in the unit for 2004. He outlined six strategies that would not only help the company reach that objective but would also boost its commercial business in 2005. While one strategy is to achieve an operating profit and contribute to BFNT's breakeven, he said, another is to achieve improved unit sales volume in the commercial business.
The company also wants to “precisely manage” its inventory, he said, noting that capacity is maxxed-out globally. Mr. Ahluwalia said the tire maker also wants to “renew and strengthen key contracts and commitments,” improve process and “build the bench”—referring to its personnel and a continuing emphasis on training and education.
Both Mr. Emkes and Mr. Ahluwalia said rising raw materials costs as well as higher energy costs are challenging the company. And even though those are two issues of concern, Mr. Ahluwalia said he's optimistic because the trucking industry continues to grow and freight volume continues to build.
In 2005, BFS is off to a great start on its commercial side, Mr. Ahluwalia said. North American sales in the U.S. and Canada “are up 106 percent to budget,” while replacement sales in North America are up 111 percent to budget. North American original equipment sales are “holding at 98 percent to budget.” That is key, he said, because it means the company is shipping more truck tire products to its dealers.