Mature Europe

EMEA: thriving on a mix of markets

 

Bekaert’s presence in the mature Western European markets on the one hand and the emerging markets of Eastern and Central Europe on the other resulted in an overall good performance in the EMEA region in 2010.

Economic conditions in Western Europe improved slightly in 2010. From Bekaert’s viewpoint, almost all sectors performed well throughout the year. In Germany especially, our products were in high demand.

In 2010, we witnessed the surprisingly quick and stable revival of the Western European automotive industry, which boosted our steel cord business. Construction, however, was the exception in the upward economic trend. To further strengthen our position in the tire cord market we acquired the Bridgestone tire cord plant BMI in Sardinia (Italy). As part of this transaction, Bekaert and Bridgestone have entered into a long-term supply agreement of tire cord to Bridgestone. After a seamless transition, during which we maintained full and faultless continuity of supplies and plant production, we initiated the integration of the plant in the Bekaert Group. We began brand visualization and the alignment of all systems and procedures according to schedule. In 2010 already the plant played a major part in helping Bekaert meet the high tire cord demand.

As part of the takeover agreement with Arisawa, Bekaert sold its progressive composites plant in Munguía (Spain).

The former Bridgestone plant in Sardinia (Italy) was successfully integrated after the acquisition by Bekaert.

The market demand for our metallic coated low carbon wires (fencing wire, pulp-baling wire, gabion wire,…) and rope wires for fishing, hoisting and automotive applications was overall rather good across Western Europe. However, in some segments such as offshore rope wire and armoring wire for data transmission cables, the markets remained rather sluggish as projects were postponed due to lack of financing.

Demand for our innovative specialty wire products was high in 2010, driven by the increased prices of iron ore and consequently those of steel, and historically low stocks in the entire European supply chain. This benefited our sales of wiper components, spring wires for automotive applications and low carbon applications like bookbinding wire and champagne cork wire. In addition, we focused on the further alignment of sales and marketing teams and the production teams in the different plants.

As for technological development, we focused on new and cost-effective processes and improved products with higher tensile strength performance and better corrosion resistance.

Innovation and product development at our European manufacturing platforms will be a determining factor in future success. The strong link with the Bekaert Technology Center (Deerlijk, Belgium) and Bekaert Engineering (Ingelmunster, Belgium) provides our Western European production platform with a unique competitive advantage.

Innovation and product development are key drivers to secure sustainable profitable growth.

Emerging Europe

Slovakia – Czech Republic

In 2010 the economies of Central and Eastern Europe picked up gradually: overall GDP growth recovered to an average of 3% in most countries.

Bekaert is a major player in supplying wire and wire products to the main automotive hubs of Central and Eastern Europe. The region offers plenty of room for growth, as indicated by the figures on vehicle use per person, rising motor vehicle registrations and higher purchasing power driving the demand for higher-quality cars.

Here the emergent construction sector acted in 2010 as a stabilizer for the overall economy. The key drivers for this trend are new non-residential construction and civil engineering projects, both benefitting from EU structural funds.

In order to be close to its customers, Bekaert long ago began establishing a strong manufacturing foothold in these attractive regions. In 2010 we continued expansion works at our production plants in Hlohovec and in Sládkovičovo (Slovakia).

In recognition of our continuous efforts to reduce the environmental impact of our operations, our plant at Bohumín (Czech Republic) received the ISO 14001 certificate in 2010. Throughout 2010 we focused on further cost optimization, skill development and building up technological competence in order to secure sustainable profitability and further growth in the region.


Russia

In 2010 the Russian GDP grew by 4%, while inflation continued to drop sharply from 11.7 in 2009 to 6.7%.

At our new steel cord plant in Lipetsk (Russia) we implemented investments, commissioning of equipment and customer approvals as foreseen in the first stage of the plant’s investment plan. In Lipetsk Bekaert produces steel cord used to reinforce radial passenger car, truck and bus tires. The outstanding support of the Lipetsk Special Economic Zone (SEZ) and the local authorities has proven crucial in ensuring progress in the building and infrastructure works.

The Bekaert plant in Lipetsk, Russia was opened in 2010. Our team in Lipetsk was able to assure a high production output from the start and established a growing customer base.

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