Continental outlines where its commercial tire business stands

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Continental AG expects to achieve 2 billion euros in original equipment and replacement commercial tire sales in 2006. The company's commercial tire capacity exceeded 7 million tires this year.

"We are currently at the limits of our production capacity," says Dr. Hans-Joachim Nikolin, who is responsible for Continental's Commercial Vehicle Tires division.

"We still have to wait and see, however, if the growth in global sales next year turns out to be as high as forecast by experts. And in a market where there is considerable pressure on prices, we will not take on any orders that would result in a loss for us.

"However, we do feel that basically, the positive trend is continuing in the replacement business in Europe and North America, as well as the OE tire market. All in all, we have increased global sales in the first seven months of this year by 3%."

Nikolin explains that Continental's commercial tire business has been impacted by raw material prices. "In the first six months, we had to deal with cost increases of 45 million euros. We could off-set these increases only in part with market price rises, whereby we did manage to improve our price position compared to the competition somewhat."

New truck tires -- such as a new van tire (the Vanco 2), a new HTL 1 "mega-trailer tire" in size 445/45R19.5, and the SuperDrive HDL1 drive axle tire -- will assist the German tiremaker's results, he adds.

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