1.1MB - Pirelli

Outdoor research at Pirelli’s Vizzola Ticino
test track.
Sales showed positive results in all product lines, with further improvements in the
product and customer mix.
In car tyres, the replacement market share improved, not only for Pirelli itself, but also
with a considerable contribution from other brand names (Ceat, Courier and Armstrong).
The new P3000E is well established in the standard segment, while the renovated P6000,
with more than 20 million units sold in the world and its use on the most prestigious cars,
confirms the brand-name/product’s high market level recognition. In the Sport Utility
Vehicles/Recreational segment a good gain was recorded thanks to the Scorpion line,
which was recently expanded by the introduction of the Scorpion Zero. In truck tyres, the
positive trend was accompanied by an appreciable improvement in profitability.
In the original equipment segment, in a scenario of growth in the manufacture and sale of
cars, Pirelli increased its market shares, achieving a new and prestigious presence in
Ford/Jaguar Group (Focus/S Type), PSA (new 206), Volvo (S 80), Mercedes Benz (A Class)
and VW Audi (TT). Market shares in the most successful models of the main car
manufacturers were also maintained and consolidated.
In Turkey, after the slowdown in the last quarter following the marked growth of activity in
the automotive sector, Pirelli succeeded in consolidating its traditional position.
The demand in North America again showed a positive trend in a market rendered even
more competitive by importers who, with their low-price products, continue their policy of
attacking market shares.
The local unit, now that its restructuring program has started, is focusing increasingly on
the Pirelli brand name in the premium and sports utility vehicles segments, by operating
through specialized dealers.
Size of North American market 1995 1996 1997 1998 1999
(in millions of units sold) (estimate) (forecast)
Car tyres:
• original equipment 46.1 44.2 43.5 43.7 43.4
• replacements 164.6 174.3 175.4 179.9 182.5
total 210.7 218.5 218.9 223.6 225.9
In South America, the effects of the turbulence on the financial markets suggest a period
of slowdown in growth rates in the medium-term and, even in the short-term, a certain
weakness in internal demand caused by the liquidity crisis.
Despite the difficulties of the local scenario, in the second half of the year, in Brazil, the
results overall were positive, with market shares at the usual high levels and with
satisfactory economic results, thanks partly to solid customer relationships. The recent
devaluation of the real, with the effect of a generally better level of competitiveness of
local industry, should further strengthen Pirelli’s operations.
Initiatives in the commercial field, aimed at consolidating and developing the main
markets of the area, include two new units which became operative during the year: Pirelli
Neumaticos Chile Ltda (Chile) and Pirelmex S.A. de CV (Mexico).
In original equipment, Pirelli was able to expand its presence by providing tyres for local
manufacturers, despite the difficulties being experienced by the automotive industry, with
vehicle manufacture and registration levels well below those originally planned.
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