The news was that the company that had long been market leader in Brazil had chosen Mexico as the site for its first non-domestic production plant. At the time, Vipal’s International Business Director Maria Locatelli explained that Mexico was chosen because it is an “entrance door” to the U.S. However, during an interview with Tyres & Accessories at the recent Reifen exhibition, Maria Locatelli explained that increased production in Mexico would also benefit European customers, both economically and by offering shorter delivery times.

The main strategy behind the investment is to make use of Mexico’s North American Free Trade Agreement (NAFTA) ties. However, the company also intends to capitalise on the production cost benefits available in the petrochemical producing country, with a view to passing a savings onto consumers in export markets like Europe. “This is not the main target, but there will be possibilities to supply [Europe],” said Maria Locatelli.

This, and supply from the company’s three other factories, will be supported by the company’s new European warehousing operation in Hamburg, which was already underway at the time of going to press. This operation means deliveries in Europe should take just 48 hours, due to the 200 tonnes of stock holding the company holds at holds in its warehouses.

New Ruzi Economy Line
During May’s Essen show Vipal also present its Ruzi pre-cured tread line, which is said to be a successful brand in the Americas, as well as the new Vipal-branded VRT-3 design drive axles on high powered highway-oriented vehicles. “We are betting on the European market and are prepared to attend all its needs: quality, competitiveness, logistics and services,” said Leandro Rigon, international business manager of Borrachas Vipal.

“Since the opening of our first distribution centres in Valencia/Spain and Logatec/Slovenia, our client portfolio has increased and obliged us to review our plans. Opening our third Distribution Centre this year in Hamburg and expanding our field team was a natural development,” Alessandro Campos, manager of Vipal Europe, added.

According to the company, the support that Vipal received from its distributors was “undisputable” – such as being supported by the company’s distributor for Bulgaria, Greece, Macedonia, Moldova and Romania (Gumi Nira Trans) for the whole week.

Vipal’s distributors are in Turkey, the Alev Group of Companies (currently with over 15% of the Turkish market share); along with Et Borislav Gogov (Bulgaria), Grumac Ltd. (U.K. and Ireland), Revipal (Spain) and Markgum (Poland). Vipal’s tyre repair distributor for Germany, Safety Seal GmbH, exhibited and promoting VIPAL’s products, as well as products for tyre shops sold by the company.

“There is no doubt that we still have a long way to go to achieve the goals proposed by the company’s top management. We still have to conquer new markets and consolidate others, but the presence of our customers, as seen at this exhibition, affirms Vipal’s success from its first day in Europe. Vipal has come to stay and will develop a long and sustainable performance in Europe,” Maria Locatelli stated.

NAFTA, the Main Target
Vipal has been open about its intentions with regard to developing its presence in North America. It has been running a small industrial unit finishing tread strips in the same vicinity as the proposed site since 2004. During this time the company has also established three warehouses on the east coast of the U.S. in Miami, Houston and Norfolk, Va. Currently the company holds a market share of between 1% and 2%. Once the new production plant is up to speed, the target is to more than triple this to 5%. Vipals works with around 50 partners in the U.S.

In Brazil, Vipal has a network of 300 licensed retreaders across its three brands. In Latin America there are another 50, but the number is expected to reach 80 by 2010 when Mexican customers are factored in. Vipal currently works with nine authorized dealers in Mexico, but following the construction of the new factory the company is aiming to more than double this figure to 20 in 18 months. (Tyres & Accessories/Staffordshire, U.K.)