Bridgestone: Tire King's "Rolling Philosophy"

Making such a decision requires great courage for Bridgestone. On the one hand, overseas, in addition to North America, which acquired FireStone, the second-largest tire manufacturer in the United States, Bridgestone has rarely made such scale adjustments, and such a major adjustment may also give Bridgestone more than 70% of its value. Overseas employees bring shock. On the Other hand, as the only racing tire sponsor of F1, Bridgestone's retreat is not the same as the retreat of Honda and Toyota's racing team. The impact on F1 is very great, so the cost of retreat is extremely high. Despite this, Bridgestone has embarked on a difficult road of adjustment.

Bridgestone's factory in Australia was built in the 1960s, and production equipment has begun to age. Despite the boom in the global automotive market before 2008, tire supply capacity has been insufficient, but today's factory operating rates in countries around the world If the production capacity becomes affluent, exports can be provided from production sites in Southeast Asia, and the barriers to shutting down factories will be reduced.

In addition, since 1997 it has been providing racing tires for F1 racing, making Bridgestone a burden of 610 billion yen a year. In the trend of increasing attention to environmental protection, F1 cars are driven by competitive speed. The effect of the game on improving the reputation of the brand is no longer as obvious as before. Coupled with the fact that the current operating performance is increasingly low, the continued sponsorship may arouse people's resentment, so Bridgestone decided to withdraw.

As soon as measures to reduce adjustments were introduced, Bridgestone's share price rose and went up, exceeding the rising rate of the Nikkei's average stock price. The stock price that fell to 1,400 yen in November 2009 reached nearly 1,600 yen in late December. In response, Mori Tomokazu, an analyst at Nomura Securities of Japan, commented that Bridgestone had no major changes before the full-year profit/loss estimation and reduction adjustment. It resolutely carried out actions to reduce adjustments, demonstrating the firm determination of the company to strengthen its corporate physique. .

Retreat into advancement and use the company's products to keep the industry's right to speak

On the one hand, the scale of production is adjusted and production is reduced. On the other hand, it is a strategy for strengthening the offensive. Car tires are particularly sensitive to speed. Arakawa’s president has repeatedly emphasized in the company’s internal affairs that “we cannot advance four times faster than others, and we must develop epoch-making products faster than others in order to gain an overwhelming sense of advancement.” Bridgestone felt pained. Only a handful of products can be heard in the industry. New product development, General Secretary General "Three Arrows Qi" hair cloth.

The first arrow is to introduce green tires with low fuel consumption and environmental protection at a lower price.

In the spring of 2009, Bridgestone decided to launch new economic tires to the market at a lower price on the basis of the existing green eco-friendly tire "ECOPIAEP100." The "ECOPIAEP100," which was launched in 2008, is an eco-friendly passenger car tire that reduces fuel consumption by 4.2% by reducing rolling resistance. It is now used by Toyota's Prius. Bridgestone regards it as "a self-confidence product that is strong enough to overwhelm a competitor in fuel consumption." Although its price is 15-20% higher than ordinary tires, it is very popular in the market.

A common understanding in the business community is that when a product is selling hot, the introduction of new similar products may affect the sales momentum of previous hot products, especially in the economic downturn. However, Shiqiaoxiu, executive director of Bridgestone responsible for sales in the domestic market, who frequently travels to and from various tire sales stores in the country every week, grasps the change in consumer awareness very accurately. “Now people who drive even smaller vans with lower fuel consumption are buying economic tires. If they can launch products with lower prices, they may have explosive growth.”

Therefore, Bridgestone decided to put economic tires with the same price as ordinary tires on the market in the spring of 2010; in the summer of the same year, the proportion of sales of economic tires was increased from 3% in 2009 to 20%. Although the demand for new cars will be weak, the demand for tires for exchange (repair) will remain firm. As a large enterprise with half of the tire market in Japan, Bridgestone's goal is to work as quickly as possible, so that new products that are in the research and development stage can be “weaned” as soon as possible, and go on the market, making the economic tire products a sign of growth and sales. commodity.

The second arrow is to step up the development of large-scale construction vehicle tires.

In June 2009, Bridgestone started the production of a new factory in Kitakyushu. This was the first time that the company had started production of a new plant 33 years later. The new plant, with a total investment of 64 billion yen, produces tires for large-scale mining trucks. The factory's most eye-catching is a large production workshop like a large passenger aircraft hangar. It produces tires with a diameter of 4 meters and each tire has a weight of 5 tons. The performance requirements of mining tires are extremely high. From extremely cold Russia to hot South American countries, open-air mining engineering trucks need to be able to adapt to a variety of harsh environmental conditions. In this regard, relatively high production technical requirements are required as compared with the production of passenger car tires.

In the first half of 2009, when the financial crisis caused the world economy to fall to the bottom, Bridgestone not only did not cut its investment, but instead started production of the factory three months in advance. Facts have proved that this decision is entirely correct. Auto sales in developed countries have been sluggish, but the momentum of resource development has not diminished. This year's market demand is expected to exceed even the same period last year. “The sales of mining vehicle tires are good. Mining companies in Australia, Chile and other countries have visited almost every month, urging us to provide products as soon as possible,” said Guan Youyi, factory manager of Kitakyushu.

In the context of the continuous appreciation of the yen, Bridgestone instead set up a new factory in Japan to produce products. Its intention is undoubtedly to achieve high quality of products. The same size of ultra-large tires, depending on the conditions of use, there are more than 20 kinds of specifications. Constantly changing the mixing ratio of raw materials, the temperature of the vulcanization process, and the time control and management, etc., this puts forward high skill requirements for the employees who are responsible for production. It is impossible to stand without professional technical training for six months to one year. Pipeline operation. At present, Bridgestone’s super-large tires account for more than 40% of the world market share. In fact, its competitors are the French Michelin family. After the start of the new factory, together with the Shimonoseki factory in Yamaguchi Prefecture, where production was once the main force, Bridgestone had the momentum to seize the largest number of large-scale tires in the world.

The third arrow attaches the same importance to refurbishing the used tire business as a new product. Bridgestone's business began to form in the second half of 2008 and entered an accelerated period of development after the summer of 2009. After the used tires are refurbished, they are sold to the same customer at a selling price of 60% of the new tires. The retreaded tires are comparable in performance and life to new tires.

In Japan, more than 90% of the commercial vehicle tire market is occupied by new products. As the largest tire manufacturer, if Bridgestone vigorously develops the used tire retreading business, it will undoubtedly affect the main product sales. However, for logistics companies that are in a deflationary market environment, they have considerable attractiveness in compressing transportation costs, and have broad prospects for development. Secondly, the profit of the old tire refurbishment business is really good, with a gross profit of up to 50%. In terms of concept, Bridgestone believes that if I can't negate my previous success model, I can't surpass adversity. Therefore, Bridgestone regards the retreaded tire business as an important part of its product strategy. It has set up a special sales team to launch sales campaigns for large transport companies, and sold 500,000 sales in 2008 when the business was on the right track. Recycled tires. Bridgestone's new goal is to increase the proportion of retreaded tires in commercial vehicle replacement tires from the current 10% to 25%.

The sale of retreaded tires is more like the sale of a service. The amount of customers it gets depends on the level of service management in the day. To this end, Bridgestone is implementing a complete tracking and management service for tires by transport companies. By providing monitoring and maintenance of air pressure and friction loss to tires in use, tire life can be extended, and retreading can no longer be used. Old tires. In this way, after stabilizing customer resources, it is not only easy to obtain the business of retreaded tires, but also to move customers to use the company's new tires. In recent years, Bridgestone has been making continuous efforts to win new customers and has achieved remarkable results. In 2009, the company has obtained new orders for 10,000 trucks through such tracking management services. The target for 2010 is to reach three times last year, that is, to provide tracking management services for 30,000 trucks.

The "First Freight Transport Company" in Yamagata, Japan, entrusted Bridgestone with its tire maintenance business for 1,000 trucks. After paying a certain amount of management fees each month, it will be able to rest easy. “This not only saves related costs, but also saves a lot of trouble, which is equivalent to saving on head expenses.” The company is very satisfied with the effect of outsourcing truck tires to Bridgestone.

Innovative mode, pinching the key to survival and development

Of course, Bridgestone's product strategy of implementing the “three arrows” method has long-term considerations and is fully prepared in advance. For example, in the field of retreading tires business, in 2007 it acquired the largest remanufactured tire company, Bendak, in a generous 120 billion yen. In North America, retreaded tires account for half of the tire demand for trucks and buses. The annual demand is about 18 million, and Benda can account for nearly half of its market share. Bendica's strength lies in its irreplaceable technological capabilities. It is used in equipment for tire retreading, such as CT scans for each used tire, flattening the worn tire surface, and the bag has been opened. The new tread equipment and other equipment are produced by the company. After Bridgestone acquired the company, these technologies were fully used in Japan's retreaded tire production process, saving large investment in technology upgrades.

It is worth mentioning that Bridgestone insists on the development of the Americas, including North America and South America. Now half of Bridgestone’s sales revenue comes from the Americas. Bridgestone's establishment in the Americas market is a “vertical integration model” that has been successfully prepared from raw material production to sales outlets. Through continuous enhancement of the entire supply chain, it improves market competitiveness. In the United States, for example, Bridgestone began localization of production from the very top of the "chain". In 2008, Bridgestone’s tire production in the United States reached 400,000 tons, which is equivalent to nearly 70% of Japan’s domestic production. In addition to six tire factories in the United States, there are five other raw material manufacturers. The raw materials for tires, including steel wire, synthetic rubber, and industrial fibers, are all locally produced.

Of course, the enhancement of downstream sales terminals is not taken lightly. In the United States, Bridgestone branded "Firestron Complete AutoCare" and rolled out 2,200 retail stores. Among them, 90 new stores were opened last year alone (2009), making it the largest tire retailer. In contrast, Goodyear, which has 700 retail stores, has closed 92 retail stores since autumn 2008.

"Only by continuously strengthening the vertical integration model, we are holding on to the key to survival and development." President Arakawa said this because the pattern of the world's tire industry is undergoing a significant change. Emerging manufacturing forces such as China, South Korea and Taiwan are emerging. And their price is less than half that of famous manufacturers. The United States could not tolerate even a sharp increase in China’s tire imports, and in September 2009 proposed an emergency safeguard. In the fiercely competitive Asian market, Bridgestone also tried to form a "vertical integration model" to differentiate itself.

The first is to operate a rubber garden in Indonesia to produce natural rubber; the other is to open retail stores in countries such as Thailand and India. “To improve the efficiency of operations from the upstream to the downstream as a whole, and to ensure full profits,” said Sato Shinto, Bridgestone’s Overseas Division Manager. Bridgestone’s success depends on whether it can successfully transplant its unique “vertical integration model” to Asia. Emerging manufacturers do not have their own raw material factories and retail networks, and Bridgestone can develop innovative new products from raw materials to the production process and push them to the market at the right price. Second, users can obtain user information and opinions on products through their own retail stores, and feedback to development and production links at the first time for product performance improvement and improvement.

Bridgestone, with its successful experience in Japan as its background, has aggressively entered the market that was originally dominated by European and American companies and grabbed the top spot in the world. But emerging manufacturers such as China and India are also likely to snatch this hegemony. Even if it is the number one enterprise, if it does not act agile, it cannot survive. It is this sense of crisis that has prompted Bridgestone to constantly change and innovate.