Big deals rule as top rubber companies stay steady

Just because there wasn't much of a shake-up in the rankings of the top North American rubber product companies doesn't mean there wasn't much activity going on. In fact, nothing can be further from the truth.

A number of companies at the top of the Rubber & Plastics News annual ranking of the Top 50 Rubber Product Makers in North America, along with the Top 50 Non-Tire Global Rubber Product Firms, were involved in deals that will impact both of these rankings in the years to come.

Just to scratch the surface, Michelin purchased belting firm Fenner P.L.C. for $1.73 billion in a deal that became effective May 31, 2018. Besides boosting Michelin's sales in North America and around the globe, it also gave Michelin its first spot ever in the Global Non-Tire Top 50, as it was able to rake in seven months of Fenner's sales after the deal was completed.

Continental also got in the act, as it acquired the AVS business of Cooper Standard Automotive in a deal that just closed April 1, so its effect won't be seen until 2020. For its part, Cooper Standard also was on the other end of another major deal, purchasing Lauren Manufacturing and Lauren Plastics in July 2018.

In another mega-deal that is still pending, Parker-Hannifin Corp. will add significantly to its rubber product revenues when its purchase of Lord Corp., announced this May, becomes finalized. Parker is paying $3.68 billion for Lord, which itself just passed $1 billion in total revenues in 2018.

The automotive world also saw a major acquisition when Tenneco purchased Federal-Mogul for $5.4 billion in a purchase that was finalized last Oct. 1. It originally planned to split the combined company back in two, but those plans are on hold for the time being.

But even with all the mergers and acquisition activity, the names at the top of both the North American and global rankings—based on 2018 revenues—remained pretty much the same.

Bridgestone Americas Inc. again topped the North American Top 50, checking in with an estimated $10.9 billion in sales for the year, just a tad bit more than 2017.

And after all the tallying was done, the Top 10 for 2018 were the same 10 as 2017. The top six spots were unchanged, though there was some shuffling in the Nos. 7-9 positions.

Michelin again was runner-up to Bridgestone, checking in with $9.09 billion in North American rubber product sales, also up just a bit from the prior year, even with the addition of some of Fenner's sales

Again rounding out the top six were Goodyear at No. 3 with an estimated $7.2 billion in rubber product sales for the year; Continental No. 4 at $5.39 billion, bolstered by both tire sales and revenue from its ContiTech non-tire rubber goods business; Cooper Tire & Rubber Co. at No. 5 with an estimated $2.28 billion in sales on the continent; and Cooper Standard, at $1.83 billion.

As for the rest of the Top 10, Toyo Tire (USA) moved up a position to take No. 7 with about $1.8 billion; Parker up a slot to No. 8 with an estimated $1.79 billion; Hankook Tire America Corp., down two spots to No. 9 with $1.78 billion; and Gates Industrial Corp., which kept the No. 10 position with $1.62 billion. Gates ended its first year as a public company after launching an IPO at the start of 2018.

Rubber products sales generally rose for those at the top of the rankings, with eight of the top 10 firms and 11 of the Top 15 posting higher sales for 2018. The aggregate rubber product sales in North America for the Top 10 rose just under 3 percent to $43.7 billion, compared with the $42.4 billion in revenues posted by the same firms in 2017.

Rounding out the Top 15, were Yokohama Tire Corp., up one spot to No. 11 at $1.57 billion; Hutchinson North America up two to No. 12 at $1.5 billion; Sumitomo Rubber North America, down two to No. 13 with $1.35 billion; Carlisle Companies Inc., up one to No. 14 with an estimated $1.32 billion; and Pirelli Tire North America, down two to No. 15 with $1.18 billion.

Those 15 firms that totaled $1 billion or more of rubber product sales were one more than in last year's rankings, with Carlisle reaching that mark in 2018.

Of the North American Top 50, 16 of the firms derive at least a portion of their sales from tires. The newest addition to that list was Giti Tire (USA) Ltd., which made its debut in the rankings tied for No. 25 with estimated North American revenues of $600 million for 2018. Giti opened its first North American tire factory in the second half of 2017, and a company must have a manufacturing presence on the continent to be eligible.

The other two newcomers to the rankings were FlexFab L.L.C. and the U.S. business unit of Datwyler Holding A.G. The two tied for No. 50 with $120 million in revenues, with FlexFab returning to the rankings after an absence and Datwyler making its debut, after opening a new U.S. plant and posting growth in North America.

Those dropping off the list were Fenner, with its purchase by Michelin, and Nishikawa Cooper L.L.C, for which sales data from 2018 wasn't available.

Non-tire rankings

Like the North American rankings, there wasn't a lot of shuffling among the leaders, with the top five spots unchanged.

Continental once again ranked as No. 1, with its ContiTech unit posting 2018 non-tire rubber product sales of $6.81 billion, followed closely by Freudenberg Group at No. 2 with $6.68 billion.

Rounding out the top five were Hutchinson at $5.78 billion, Sumitomo Riko at an estimated $4.05 billion and Cooper Standard at an estimated $3.45 billion, the highest ranking U.S.-based firm on the list.

There was some shakeup in the rest of the Top 10, with Gates moving up two spots to No. 6 with $3.35 billion; Bridgestone down a spot to No. 7 at $3.31 billion; NOK Inc. also down one to No. 8 with $3.26 billion; Parker-Hannifin climbing two spots to No. 9 with an estimated $2.86 billion; and Trelleborg remaining steady at No. 10 with $2.81 billion.

Malaysia's Supermax Corp., a producer of latex gloves, debuted on the list at No. 12 with $1.96 billion. Michelin also debuted on the list at No. 43 with $613.2 million, off of Fenner-related revenue posted after the acquisition became final.

The U.S. had the most companies represented in the Non-Tire Top 50, with 17. That was followed by Japan with 13 and Germany with six. Other nations with multiple entries included France with three and China, Sweden and Malaysia with two each. Those with one company making the rankings were the United Kingdom, Australia, South Korea, Austria and Switzerland.