TOKYO — If Bridgestone Corp. wants to maintain its top spot globally as a tire and rubber product manufacturer, it figures it will need to spend a lot of money.
It fully intends to do that during the next five years. The tire maker plans to dole out about $2.44 billion in 2007 and more than $2 billion a year through 2012 in capital investments to upgrade and expand its business, according to a spokesman in Japan. He said the capital investment could vary from year to year.
Company officials said Oct. 22 during a conference with the financial community in Tokyo that as part of its five-year plan, the firm will expand sales outside of Japan.
It aims to do the same in the specialty tire market, and the firm has set a goal of increasing operating income 80 percent and boosting consolidated net sales by approximately 20 percent to about $35 billion with a 6-percent return on assets.
Two of Bridgestone´s strategies for growth include leveraging segments where it has a competitive advantage-such as run-flat tires, ultra-high performance tires and winter passenger tires, as well as Greatec-brand and low-profile tires for trucks and buses-and increasing its competency to ensure long-term superiority over other tire makers, the firm said.
The company said it hopes to achieve the latter objective by boosting sales of radial tires for large off-the-road vehicles, aircraft and motorcycles.
Another part of the firm´s five-year plan calls for making full use of Bandag L.L.C., which Bridgestone Americas Holding Inc. purchased for more than $1 billion in June, by providing package solutions in the truck and bus tire retread industry.
That will involve combining Bridgestone´s new tire technology with Bandag´s retread technology to give customers total service, the spokesman said.
Bridgestone — which also produces industrial rubber and chemical products and sporting goods — will remain aggressive in the marketplace, the spokesman said, especially in markets outside of Japan.
The company didn´t say what gains it expects to make in North America.
Each Bridgestone business unit has created its own growth plan, he said, while the parent company has a global plan in place to support those platforms.
The annual spending pledge is roughly the same as Bridgestone spent in 2006 in capital investments and is equal to about 9 percent of sales.
Bridgestone officials outlined several other management policies as part of its global plan that include enhancing its competitiveness and aiming for a higher level of raw material development and manufacturing technology.