Bridgestone Competition
Now Viewing Bridgestone's competition in: Tire Manufacturers (primary)
Call Preparation Questions
Customers, Marketing, Pricing, Competition
What are the company’s major customer segments? - Companies may sell tires to OEMs, such as auto manufacturers for use on new vehicles, or sell replacement tires to dealers, distributors, wholesalers, or directly to consumers.
How much of the company's production goes to OEMs? - New cars made by OEMs account for about 20 percent of the tire market.
Does the company operate its own retail stores? If so, how many? How much of its production is sold through these stores? -
Do any individual customers represent more than 10 percent of company revenue? If so, how many and to what extent? - Companies that depend on too few customers for a majority of their revenue can be at risk.
What challenges does the company face getting market share? - The tire business is very competitive and price-sensitive.
What are the company’s main means of advertising and promotion? - Many companies sponsor racing cars and events, in addition to using TV ads and other forms of conventional advertising.
What pricing issues is the company facing? - The car tire market is price-sensitive. Truck tires often are more profitable but the market is much smaller.
Who are the company’s major competitors? - Low-cost imports from the Far East are challenging domestic tire producers, particularly in the car segment.
Competitive Landscape
Demand is driven by sales of new vehicles and the need for replacement tires. Because tires are largely a commodity, profitability depends on cost-efficient operations. Small companies can compete by producing tires or tire-related products for niche markets, such as bicycles or farm equipment. Large companies can afford the research to develop tires from new, technologically advanced materials, and can invest in improving production efficiency. The industry is capital-intensive: average annual revenue per employee is over $200,000.
Business Challenges
CRITICAL ISSUES
Demand Closely Tied to Auto Sales, Economic Cycles - Demand for tires depends on new car sales and highway-miles of driving, both which are affected by economic slowdowns. New car production can drop 5 to 10 percent in one year during a recession, as car and truck traffic flattens. US tire production dropped 13 percent during the last recession.
Competition from Low-Cost Imports - Tire imports from low-cost countries have kept retail prices flat, despite higher costs for US producers. Foreign producers can use low-cost labor to assemble tires by hand. In the last five years, tire imports from China doubled. Imported tires hold about 30 percent of the US market.
Industries Where Bridgestone Competes
- Industrial Manufacturing
- Rubber & Plastic Product Manufacturing
- Tire Manufacturing(primary)
- Rubber & Plastic Product Manufacturing
- Chemicals
- Construction
- Consumer Products Manufacturers
