Bridgestone realigns European operations, shifts to higher output of low-profile, performance, truck and bus tires

Bridgestone Corporation has realigned the firm’s European operations, predicting a surge in demand for low-profile performance, minivan and sport-uility applications. Bridgestone’s European subsidiary, Bridgestone/Firestone Europe S. A., will also be renamed Bridgestone Europe. The program will include a cash infusion, and accelerated writedowns on older plant assets.
Production capacity will more than double at Bridgestone/Firestone Europe’s Poznan Plant, in Poland, which manufactures high- performance tires. The company will increase the daily production capacity at that plant to 23,000 tires by the end of 2006, from 10,000 presently.
Meanwhile, Bridgestone/Firestone Europe will shift production toward high-performance products at its other plants for passenger car tires. Upgrading development capabilities in high-performance tires is the primary purpose of a proving ground that Bridgestone/Firestone Europe is building near Rome.
Bridgestone/Firestone Europe also will expand its production capacity in truck and bus tires. It will increase the daily production capacity for truck and bus tires at its Bilbao (Spain) Plant to 4,600 tires by the end of 2005, from 3,500 presently.
To fund the new capital spending and a planned wave of investment in expanded marketing channels, Bridgestone corporation will provide its European subsidiary with a capital infusion of 400 million euros. Bridgestone/Firestone Europe will streamline its balance sheet by writing down the valuation of fixed assets. The company will record a special charge of 300 million euros this year in connection with the revaluations of fixed assets. The charge has no effect on cash flow.
On January 1st, Bridgestone/Firestone Europe will change its name to Bridgestone Europe S. A., similar to a change in the Americas, where Bridgestone/Firestone Americas Holding, Inc. will change its name to Bridgestone Americas Holding Inc. According to the company, the change will help build a corporate identity under the Bridgestone name while building strong identities for product lines under the Bridgestone, Firestone and other names.