Hankook Tire Becomes the World’s Seventh Largest Tire Manufacturer
- 20% growth rate attributing to Hankook Tire’s move up the world rankings
- Product quality strategy reflected in increasing demand and strong European tire tests
SEOUL, KOREA, MARCH 22nd, 2007 - Hankook Tire (www.hankooktireusa.com) has grown to become the world’s seventh largest tire manufacturer based on 2006 sales, according to independent industry figures published by Modern Tire Dealer.
The figures show how Hankook Tire’s focus on superior quality and high performance tires has translated into sales of US$3 billion in 2006, up from US$2.5 billion in 2005. This growth comes despite the fact that the value of the Korean won fell by approximately 8% against the US dollar in 2006*. The 20% growth rate, the joint highest of all eleven global tire manufacturers listed, propelled the company to rank joint-seventh with Yokohama Rubber Company, climbing from eighth in 2005 and eleventh in 2001. Hankook Tire’s stock price also increased by 20.1% in 2006, reflecting strong financial fundamentals, not least of which is a profit margin of 8.4%.
Mr. Seung Hwa Suh, CEO, Hankook Tire, said, “Hankook Tire is a company with aggressive future growth plans. We are enhancing our global management structures, putting increased efforts into greater brand building and, in the summer, our first European production facility in Hungary will become operational. As the market increasingly recognizes the superior quality of our products, we are seeing more and more opportunities developing for us in Europe, in China and in the U.S. and this increasing demand is driving the company forward.”
Hankook Tire is targeting US$3.6 billion (tire sales only) in sales and a 9.4% operating margin in 2007, through growing sales of its high performance tires. The company recently emphasized the strategic importance of technology by appointing Mr. Hwi Joong Kim, CTO/CPO of Hankook Tire, to the Board of Directors, and it will continue to invest 5% of revenue in R&D at centers located in Korea, China, Germany, Japan and the US.
In 2007, the company will focus on establishing global management systems which will raise organizational, processing and personnel capabilities to globally recognized standards and ensure greater levels of customer service and product quality. Operations at its 5th, 500 million Euro production facility in Hungary will begin later this year to meet overwhelming demand from its European customer base and establish the company as a truly global manufacturer. The company is also investing 5% of revenue in marketing to build its global brand.
“More and more people are recognising that a Hankook tire represents not only good value but an outstanding level of quality on a par with or exceeding the largest global brands,” says Mr Suh. “This is reflected in the increasingly positive results we are winning in independent tire tests.”
In the latest series of tire tests published in Germany, Autobild SportsCars, the specialized tuning magazine, ranked Hankook Tire’s ultra high performance Ventus S1 evo first out of ten other high performance tires in April edition. The company also received ‘recommendable’ grades from ADAC and Stiftung Warentest for its Ventus Prime and Optimo K715 tires, with Stiftung Warentest recognising the Optimo K175 as the most environmentally friendly in its class in March edition. In February, ZDF TV, the second largest national TV network in Germany also picked out the Ventus Prime and the Optimo K715 as best-buys amongst recommended and competing tires. Gute Fahrt rounded off the encouraging results in its all-weather tire test which assessed the Centum H 720 as third best and awarded it the overall mark of ‘good’.
Notes to Editor
Figures (in USD billions) from Modern Tire Dealer, new tire sales:
||Goodyear Tire & Rubber Co.
||Pirelli & Cie SpA
||Sumitomo Rubber Industries
||Hankook Tire Co.
||Yokohama Rubber Co.
||Cooper Tire & Rubber Co.
||Kumho Tire Co. Inc.
||Toyo Tire & Rubber
*This figure is based on the change in the exchange of the Korean won against the dollar between the period 2nd January 2006 and 29th December 2006.