know a leader - david shaw - rubber & tyre

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INTERVIEW WITH DAVID SHAW CEO - Tire Industry Research Know A LEADER In 10 Questions Rubber & Tyre http://rubbermachineryworld.com 11 Innovations in Tyre Building 30 Machinery Advice 24 India or China? 21 Sustainable Tyres 15 Machinery Developments

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Page 1: Know a Leader - David Shaw - Rubber & Tyre

INTERVIEW WITH

DAVID SHAWCEO - Tire Industry Research

Know A

LEADER In 10 Question

s

Rubber & Tyre

http://rubbermachineryworld.com

11Innovations in Tyre Building 30

MachineryAdvice

24India or China?

21Sustainable Tyres 15

MachineryDevelopments

Page 2: Know a Leader - David Shaw - Rubber & Tyre
Page 3: Know a Leader - David Shaw - Rubber & Tyre

This quote aptly summarizes David Shaw. True leaders are

few and probably the main reason (when we find one!), we

look towards them for inspiration and guidance regularly.

(or Dave to his friends and well-wishers), is a David Shaw

tall leader and a global expert on the international tire

and rubber industry. I consider it a privilege to know him

and present his thoughts to you in this special edition.

Dave has studied tire manufacturing, raw materials,

processes and technologies and how they vary around the

world. This deep technical knowledge, built up over 25

years combined with a thorough understanding of

branding, pricing and distribution channels, gives him a

unique advantage to analyse regional and global strategies

in car, light truck, heavy truck & speciality tires.

With exceptional knowledge, clarity, relevance and

insight, Dave offer both overviews and detailed analyses

of companies, markets, sectors, segments and regions as a

strategy consultant.

Once you finish reading his passionate interview, you will

agree when I say that I felt sad, we could ask him only 10

questions under our format. But hey! you can always

reach Dave on his site .www.TireIndustryResearch.com

I hope you find this interview insightful and informative.

As always, I welcome your feedback on

[email protected].

Best Regards

Prasanth Warrier

| Interviewer’s Note |

“A leader is one who knows the way,

goes the way and shows the way”- John C. Maxwell

True leaders are few

and probably the

main reason (when

we find one!), we

look towards them

for inspiration and

guidance regularly.

3

rubbermachineri

rubbermachineryworld

+Rubbermachineryworld1

grp/home?gid=8252803

rubbermachineri

Know A Leader - Rubber Machinery World DEC 2015|

Page 4: Know a Leader - David Shaw - Rubber & Tyre

4

| LEADER - INTERVIEW |

Know A Leader - Rubber Machinery World DEC 2015|

“Soon after 1989, it became clear to

me that the rubber industry was one

that I enjoyed and wanted to be a

part of”

Page 5: Know a Leader - David Shaw - Rubber & Tyre

| LEADER - INTERVIEW |

Know A Leader - Rubber Machinery World DEC 2015|

5

From Engineering Design Education PW:

Officer to a global expert on the tyre and

rubber industry is an amazing transition.

Looking back, was this a goal-oriented

shift for you or an outcome of opportun-

ities that presented itself at various

moments of your career? Would you

highlight the keys for your success?

Very soon after I joined ERJ (EuropeanDS:

Rubber Journal) back in 1989, it became

clear to me that the rubber industry was

one that I enjoyed and wanted to be a part

of.

This industry is full of experts who have

been in the business for many years and

have an intimate understanding of the

behaviour of rubber, steel cord and other

ingredients. In addition, it is a relatively

small industry to the point where, after a

few years, you begin meeting the same

people at events from Hanover to Shanghai

and South Carolina to New Delhi.

Four years ago ERJ came under new

management. After some soul-searching, I

decided to leave and to set up on my own.

In that time, I have learned that the

PRASANTH WARRIER (PW): Hello David. First of all thank you for accepting an interview

with Rubber Machinery World (RMW) and sharing your thoughts.

Hi Prasanth. First, may I congratulate you on your initiatives in the DAVID SHAW (DS):

rubber machinery business. I have been following your progress and wish you the very

best of success in this new venture. Also, I feel honoured that you have invited me to

participate in this enterprise.

Thanks Dave. The pleasure and privilege is mine.PW:

industry is transforming due to geographic

changes and technological changes and that

there is a new type of person coming into

this industry who has great expertise in

sales or marketing, but needs rapid access to

knowledge and insights about the rubber

and tyre sector. Part of what I do is to help

those people with some analyses of different

aspects of this complicated industry.

When I set up my company, I saw a great

need in the industry for detailed insight into

a series of key issues. Those were, in order

of priority, sustainability issues and China. I

set out to write the definitive reports

analysing those issues – and a few others.

Those first two reports are now available

through my website at

www.TireIndustryResearch.com

As the editor of a leading journal, I PW:

believe you have met 'who's who' in the

industry over 25+ years. What were the

interesting experiences that deeply

influenced your thinking on tyre industry?

You are right – it has been a fascinating DS:

ride. I have been fortunate indeed to meet

Page 6: Know a Leader - David Shaw - Rubber & Tyre

6

| LEADER - INTERVIEW |

Know A Leader - Rubber Machinery World DEC 2015|

with hundreds of very senior people in

this industry and ask them difficult

questions. Perhaps even more surprising

is that these wonderful people have

found the time to respond to those

questions in thoughtful and considerate

ways.

In exchange, I hope that I can bring new

insights. Through conversations with

many people from different companies

and different parts of the industry, I hope

that I can explore the nature of this

integrated business all the way from raw

materials production to branding,

marketing and distribution.

For example, the way a tyre is made and

the machinery used to make it allows new

marketing messages. Equally, the way a

tyre is marketed has an impact on

manufacturing processes.

An example: in tyres the use of 3-dimen-

sional sipes delivers benefits in terms of

life, long-term performance characteristics

and handling, but that is only made

possible by new manufacturing techniques

such as 3-D printing for moulds and new

analytical techniques such as modelling of

the strength of rubber to minimise tearing

during de-moulding.

Another example is the increasing use of

silica and silanes in tread compounds.

From a marketing perspective, this

delivers better fuel economy and wet grip.

But in the manufacturing environment it

forces a change in the role of the internal

mixer. The mixer changes from a non-

reactive mechanical mixer into a reaction

vessel which has to deal with exothermic

reactions; increased corrosion and other

challenges.

You see all kinds of claims made by

marketing teams, and these often reflect

new technologies used in the manufacturing

environment. Conversely, requirements

from customers also drive changes in the

manufacturing department. Examples might

include the drive to better repeatability or

the requirement for short change-over times.

“Internal mixer

changes from a

non-reactive mechanical

mixer into a reaction vessel

which has to deal with

exothermic reactions;

increased corrosion and

other challenges.”

“For example, the way a tyre

is made and the machinery

used to make it allows new

marketing messages.”

Page 7: Know a Leader - David Shaw - Rubber & Tyre
Page 8: Know a Leader - David Shaw - Rubber & Tyre
Page 9: Know a Leader - David Shaw - Rubber & Tyre

| LEADER - INTERVIEW |

Know A Leader - Rubber Machinery World DEC 2015|

One school of thought endorsed by PW:

another expert is that there have been

very few changes in tyre industry in the

last 100 years. Your views?

I saw your interview with Jacob DS:

Peled. I like Jacob very much. He has

been a good friend and teacher to me and

has been in the business longer than I

have, so I have great respect for his views.

He is right to say that there has been

limited progress in the fundamental

design of much equipment in the tyre and

rubber industry, but I think his analysis

can be expanded.

We have seen huge improvements in the

detailed design. Productivity, repeatability

and process-flexibility have all improved

tremendously in the last couple of decades,

albeit in a series of incremental

improvements.

The introduction of consumer labelling for

tyres a few years ago in Japan, Korea and

the EU led to a near-revolution in the tyre

manufacturing side in which machinery

makers were asked to deliver equipment

that can make semi-finished components

and finished tyres with tight Cpk and Cpp

values.

Tyre building has changed massively –

not only with the introduction of radial

designs in the 1940s, but over the last

couple of decades the need for more

automation and faster size changes has led

to a transformation in the design of TBM

equipment and especially building drums.

Although mixers still use the same principles

as original designs of Thomas Hancock, the

power of the rotors, the heat transfer

capacity and the variety of rotor designs for

high shear, intensive mixing and other

processes show tremendous creativity and

development.

It so happens that I believe the internal

mixer is close to the end of its development

“Productivity, repeatability and

process- flexibility have all improved

tremendously in the last couple of

decades.”

9

Page 10: Know a Leader - David Shaw - Rubber & Tyre

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Page 11: Know a Leader - David Shaw - Rubber & Tyre

| LEADER - INTERVIEW |

Know A Leader - Rubber Machinery World DEC 2015|

cycle. I think that in the near future we will

see some very significant developments in

mixing technology which can overcome

some of the limitations of internal mixers

when it comes to high-volume, highly disp-

ersive mixing of silica in solution SBR and

high molecular-weight Nd-BR compounds.

PW: Tyre design is a fascinating topic

though few people really understand the

differences in design between brands.

How has the tyre designs really changed

during the last 30 years as you witnessed

it? What were the key factors driving this

change?

In my opinion tyres today are barely DS:

recognisable as cousins of their predecessors

from just a few decades ago. Of course, they

remain black and round, but the similarities

end there.

When I first started in this business in the

1980s the industry was reactive, moribund

and extremely slow to adopt change.

During the 1990s we saw a series of

innovations in tyre building starting with

Michelin's C3M, followed by Pirelli's MIRS,

Bridgestone's BIRD and other innovations.

These were driven by a requirement to

make short runs of tyres as tyre sizes

proliferated. Instead of making a

production run of 100,000 units, the typical

run fell to below 1000 units. Taking a half-

day to switch sizes was no longer economic,

so machinery makers sought to make

equipment which could change from a

14-inch size to a 17-inch size with no

downtime.

Most of those new production techniques –

C3M and the rest – were ultimately too slow

or too unreliable for continuous commercial

“During the 1990s we saw a

series of innovations in tyre building starting with Michelin's

C3M, followed by Pirelli's MIRS, Bridgestone's BIRD and other.”

11

Page 12: Know a Leader - David Shaw - Rubber & Tyre

| LEADER - INTERVIEW |

Know A Leader - Rubber Machinery World DEC 2015|

12

use. Some of them are still are used for small

volume or speciality products. Meanwhile

the same drivers led more traditional

machinery suppliers to develop more

automated, more flexible equipment such

as the Exxium from VMI's MAXX portfolio.

Into the 2000s and we are seeing a total

revolution in materials technology. It started

with solution-SBRs and the new ability to

add functional groups. The revolution

continued with high molecular-weight

butadiene rubbers which are difficult to

mix and process, but offer better rolling

resistance than earlier polymers.

That revolution continues with nano-scale

fillers and their requirement for highly

dispersive mixing. Another driver is to use

sustainable materials in tyre manufacture.

These new materials include cornstarch,

orange oil, low-PAH process oils; new

resins, guayule-sourced natural rubber and

many, many more.

In the reinforcement segment we are now

seeing hybrid cords mixing aramid with

nylon, but also other combinations to

deliver combinations of strength and shock

absorption. Steel cord has moved from high

tensile to ultra-tensile with a consequent

reduction in mass of steel and reduction in

complexity of wires, but also thinner,

stronger wires mean less rubber is needed

to coat them.

Many of these innovations are driven by a

deep need to improve the fundamental

physics of filled rubber vulcanisates. A

simple e-SBR/carbon black compound has

three properties linked together in an

eternal triangle:

- Rolling resistance (fuel economy)

- W ear life (longevity)

- Wet grip (safety)

For any individual product the balance

between the three properties can be

tweaked. Americans like longer life, but

care less about wet grip or fuel economy,

whereas Europeans tend to favour safety

over longevity. However, an improvement

in one area always means a compromise

in one or both of the other parameters.

Image of VMI MAXX and EXIUM Tire Building Machines

“Another driver is to use

sustainable materials in tyre

manufacture.”

Page 13: Know a Leader - David Shaw - Rubber & Tyre
Page 14: Know a Leader - David Shaw - Rubber & Tyre

| LEADER - INTERVIEW |

Know A Leader - Rubber Machinery World DEC 2015|

This means that the compounds will be more

scientifically designed and produced. I also

expect that once compounds of this nature

have been developed, they will have to be

processed with much more care in order to

avoid disruption to the filler structures and

structure of the inter-penetrating polymer

networks. As a result we will see fewer

aggressive processing techniques and an

increase in low-shear; low-intervention

processes.

“I also expect that compounds have to be processed

with much more care in order to avoid disruption to

the filler structures and structure of the inter-penetrating

polymer networks. As a result we will see fewer aggressive

processing techniques and an increase in low-shear;

low-intervention processes.”

The key driver in tyres is to expand this

triangle to permit all three properties to be

improved at the same time. This is the

thinking behind the silica-silane revolution

started in 1992 with Michelin's Green X tyre.

One trend in the future will be to improve

dispersion. This will reduce the number of

stress concentrations due to filler

agglomerations. Other trends will be to

develop still further the polymer molecules

and to increase the specific surface area of

filler particles.

14

Page 15: Know a Leader - David Shaw - Rubber & Tyre

| LEADER - INTERVIEW |

Know A Leader - Rubber Machinery World DEC 2015|

What new ideas are energizing the PW:

tyre industry globally? How much of it

is related to machinery developments

or improvements ?

I have hinted above that I think the DS:

internal mixer is approaching the end of

its product development cycle. Wear rates

on tyres are closely linked to the

uniformity of the compound on a 10nm –

100nm scale. That's the size of

agglomerations of carbon black and silica

particles. More discontinuities in that size

range lead to greater stress concentrations

and consequently increased wear under

dynamic loading as seen in hard cornering

or heavy braking.

Current internal mixers are close to their

limit when compounders want good

dispersion on these scales, especially when

mixing silica which likes to self-agglomerate.

I think we will see some very significant

changes to the mixing process during 2016.

If the industry adopts these new changes –

and I am convinced that they will – then the

design of compounds and the care of

compounds will become a new field for

machinery makers. I can envisage whole

new classes of machinery which are less

aggressive towards the compound. This in

turn should lead to lower energy costs and

improved product performance.

Second, the machinery suppliers have

traditionally looked only at initial capital

investments by tyre makers with on-going

maintenance contracts where they can sell

them. They have restricted themselves to

the machinery.

I suspect that one or two of them will

venture into the raw materials supply area.

Already we have seen Mesnac investigating

some material properties. Today this is

largely driven by a need to better

understand how these materials can be

processed.

“Current internal

mixers are close

to their limit when

compounders want

good dispersion

on these scales,

especially when

mixing silica

which likes to

self-agglomerate.”

15

Page 16: Know a Leader - David Shaw - Rubber & Tyre

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Page 17: Know a Leader - David Shaw - Rubber & Tyre

| LEADER - INTERVIEW |

Know A Leader - Rubber Machinery World DEC 2015|

I remember a conversation with Ronil

Malaney in India a few years ago. At the

time he was acting as agent for machinery

makers and for materials suppliers. There

are strong synergies in that combination.

As machinery supplier, you get an idea of

the capacity of the factory and so can

predict what materials will be needed and

in what volumes. As materials supplier, you

can get an idea of when a factory is close to

capacity and might want to think about

expanding, so can time your upgrade

suggestions accordingly.

Today, profitability for tyre PW:

producers is from falling raw material

prices, which may not be a true reflection

for the future. Strategically, where do you

see opportunities for tyre producers to

build sustaining profitability while

simultaneously adding value to their

customers?

This is a great question, and I have DS:

blogged about it in some detail. First, I think

that tyre makers have, in general, increased

margins as raw materials prices have fallen.

However, tyre makers in low-cost countries

“A 10% fall in raw material

input costs represents only

2-3% reduction in total costs

of a premium brand, but can

reduce overall costs of a Chinese

or Indian tyre maker by 6-7%.”

Image: From Web

17

Page 18: Know a Leader - David Shaw - Rubber & Tyre

Know A Leader - Rubber Machinery World DEC 2015|

| LEADER - INTERVIEW |

are more exposed to the raw materials

prices than those in the developed world.

That is to say, a 10% fall in raw material

input costs represents only 2-3% reduction

in total costs of a premium brand, but can

reduce overall costs of a Chinese or Indian

tyre maker by 6 – 7 %.

This means Chinese tyre makers are at an

advantage when raw materials costs are

low, as they can cut prices further, or will

see a bigger improvement in their margins

than the premium brands. As raw

materials costs increase, it has limited

impact on the premium brands, but a large

impact on profitability at the lower end of

the price spectrum.

Already Chinese brands are having a major

impact on tyre sales in most of the

developed world, and also in India, the

Middle East, Africa and other parts of the

developing world.

With raw materials prices expected to

remain low for the foreseeable future, this

gives the low-end brands an opportunity to

raise their game in terms of brand

recognition and quality.

Premium brands can fight back, but only by

finding ways to extract more value from the

tyre than its simple ability to roll on an axle.

Adding value through sensors and data

capture will be a big part of the future for

premium brand tyre makers. The impact on

machinery makers will be to find ways to

“Adding value through

sensors and data capture

will be a big part of the

future for premium brands.”

Image: Bridgestone

18

Page 19: Know a Leader - David Shaw - Rubber & Tyre

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Page 20: Know a Leader - David Shaw - Rubber & Tyre
Page 21: Know a Leader - David Shaw - Rubber & Tyre

| LEADER - INTERVIEW |

Know A Leader - Rubber Machinery World DEC 2015|

incorporate the different sensors

currently being developed by the tyre

makers.

These include read-write RFID tags;

accelerometers, pressure monitoring

devices in the tread package and/or in

the valve stem.

PW: Are eco-friendly or green tyres

claimed by various tyre producers

sustainable? What parameters really

qualify as “sustainable”?

Sustainability is a huge issue in this DS:

business, but the word has so many

different meanings to different groups

that using it as part of a business agenda

has become a little counter-productive,

in my view.

To an environmental activist, the

meaning is clear: save the planet; slash

the release of fossil carbon; maintain

human rights and land rights and so on.

To a business, the meaning includes most

of these aspects, but it also involves

identifying and managing risks to the

corporate business model.

Within the first definition, 'Green' tyres

(the less eco-damaging variety, rather

than just those between the building

machine and the curing press) deliver

improved fuel economy. Thus, they help

reduce the release of fossil carbon

consumed in the engine.

“All Life Cycle Analyses suggest

that upwards of 80% of the total

energy footprint of a tyre is

generated during the in-use

phase, as opposed to

manufacture, logistics or

disposal.”

Depending on the tyre and its application

all Life Cycle Analyses suggest that upwards

of 80% of the total energy footprint of a

tyre is generated during the in-use phase, as

opposed to manufacture, logistics or

21

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| LEADER - INTERVIEW |

Know A Leader - Rubber Machinery World DEC 2015|

disposal. Saving 25% of the fuel used during

the in-use phase will more than compensate

for all the energy consumed during

manufacture.

These calculations are behind the

tremendous thrust to improve fuel economy

of tyres over the last couple of decades. This

pressure will increase still further.

Among car and truck makers, the drive to

cut fuel consumption and emissions

remains a very strong priority, driven by

government legislation.

For a vehicle maker, it is cheaper to tell tyre

makers to deliver better performance than

to develop a new engine, for example. So

rolling resistance will remain a key driver

for the foreseeable future in all tyre

development for OE requirements. As

consumer labelling expands around the

world, rolling resistance will also be a factor

in the replacement market.

“For a vehicle maker, it is

cheaper to tell tyre makers to

deliver better performance

than to develop a new engine,

for example. So rolling

resistance will remain a key

driver for the foreseeable

future in all tyre development

for OE requirements.”

Image: From Web

23

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| LEADER - INTERVIEW |

Know A Leader - Rubber Machinery World DEC 2015|

PW: What do you think could potentially

change the growth trajectory of the tyre

industry? Who would have a greater

role – India or China or Someone else?

This is a topic of considerable debate DS:

right now. Most economists in this business

have used projections of economic growth

in China as the basis of their predictions of

the number of tyres used, and from there

they project volume growth for polymers,

for carbon black silica and all manner of

other ingredients – not to mention tyre

building machinery.

China's growth has slowed considerably in

the last couple of years. Although official

data put GDP growth there at 7% or so, the

real growth in 2015 is surely closer to 4%.

If we put that number into the projections

for 2015, then the long-term growth curve

is slightly lower. But if that slowdown

remains in place in 2016, then the curve

drops a little more. If the slow-down

continues for more than a few years, the

predictions based on sustained 7% growth

become more and more obviously

over-optimistic.

Already we are seeing some famous

economic forecasters having to revise

downward their projections for 2015 and

2016 and beyond. I don't think we are at the

end of this downward revision process.

China remains by far the largest producer of

tyres in the world. Nevertheless, there is

substantial over-capacity there, which has

led to severe price competition. The most

successful companies are discovering that

GLOBAL GROWTH FORECASTS FOR 2016

Source:

24

Page 25: Know a Leader - David Shaw - Rubber & Tyre

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Page 26: Know a Leader - David Shaw - Rubber & Tyre

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Page 27: Know a Leader - David Shaw - Rubber & Tyre

| LEADER - INTERVIEW |

Know A Leader - Rubber Machinery World DEC 2015|

they can avoid import tariffs on China-made

tyres by setting up offshore manufacturing

in Thailand, Vietnam, Indonesia, Russia and

elsewhere.

My belief is that China will continue to be

important, due to sheer volume, but in the

next 5 years there will be a painful shake-out

in that country. Nevertheless, Chinese-

controlled companies will become

increasingly influential in the business,

albeit with manufacturing in many different

countries.

As to India, I see MRF, Apollo, JK, Ceat and

other companies with world-class strategic

management, skilled workers and an educ-

ated and well-travelled management class.

I see universities and scientific institutes

producing world-class research in India.

Clearly, there are opportunities for India-

based companies in the global tyre industry.

I also see a new generation of managers

taking over at some of these companies.

Where the father built the business up to

serve the Indian customer base, the son is

now preparing to move the company into

the global arena.

India will certainly become a force in the

global tyre industry, but I think it will be

some years before the volume of tyres

made in India can match the volumes

made in China today.

“My belief is that China

will continue to be

important, due to sheer

volume, but in the next

5 years there will be a

painful shake-out in that

country. Nevertheless,

Chinese-controlled

companies will become

increasingly influential

in the business, albeit

with manufacturing in

many different countries”

27

Page 28: Know a Leader - David Shaw - Rubber & Tyre

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Page 29: Know a Leader - David Shaw - Rubber & Tyre

| LEADER - INTERVIEW |

Know A Leader - Rubber Machinery World DEC 2015|

As a consultant, you interact with PW:

machinery manufacturers. What major

concerns do you hear them talking

about in today's VUCA economy?

Forgive, me, I had to research the VUCADS:

acronym. I think it stands for Volatile,

Uncertain, Complex and Ambiguous.

Earlier, I referred to the boring,

unambitious years of the 1980s. In those

days our crystal balls were clear – we could

make some good predictions of the future,

even 5 to 10 years out. Nowadays, most of

my friends in the business think that

making predictions for 5 years into the

future is little more than an exercise in

futility.

That is a problem in an industry where

capital investments need to be made on

multi-year timescales. In natural rubber

we have to plant trees 7 to 10 years before

the rubber is needed. Buying a new mixer

line represents something like a 10-year

view on the business. Setting up a factory

could represent a commitment for 20

years or more.

With capital purchase we need to work out

the cost of ownership and also the

investment return, amortisation and break-

even points. With large capital projects we

are looking at multi-year timescales, so a

VUCA economy makes it more challenging

to present a persuasive case for large

investments to banks or to boards.

In the period after the 2008 Lehman Bros

collapse, we saw investment cycles drop

significantly. Senior management across the

industry would not authorise any capital

project unless it had a pay-back of under 12

months, or, in exceptional cases, 18 months

maximum. That meant larger projects were

either put on hold or cancelled.

We are not back to those days. I think

managements have learned to live with the

uncertainty, but that means managers who

want to invest in large capital projects need

to make a stronger case, using multiple

financial scenarios and demonstrating that

the business risk can be minimised, even in

the downside scenarios. That takes time and

all managers today are massively over-

worked, so it further adds to the burden of

machinery makers' clients.

Another major problem for machinery

suppliers is that the investment in new tyre

factories in China is drying up fast. I think

that is a good thing for the industry as a

whole, but I know that some machinery

suppliers have long relied on projects in

that part of the world for their volume.

“Another major problem for

machinery suppliers is that

the investment in new tyre

factories in China is drying

up fast. I think that is a good

thing for the industry as a

whole, but I know that some

machinery suppliers have

long relied on projects in

that part of the world for

their volume. ”

29

Page 30: Know a Leader - David Shaw - Rubber & Tyre

| LEADER - INTERVIEW |

Know A Leader - Rubber Machinery World DEC 2015|

The companies who failed to hitch a ride on

the China bandwagon may find that their

fortunes rise again as their more heavily-

exposed competitors suffer from the China

downturn.

Great! And one last question, what PW:

would be your advice on machinery to

both equipment buyers and equipment

sellers?

To both buyers and sellers, I'd say theDS:

future will see a lot of machinery makers;

some will be based in Asia; some in Europe

and some in the Americas. It will become a

lot more difficult to guess which offer high

tech and high prices or low tech and low

prices simply by looking at their country

of origin.

My advice to sellers would be to explore

every way of removing cost without

removing value and to develop a deep

understanding of the attributes your

customer thinks genuinely add value;

concentrate on those aspects to exceed

the expectations of your customer.

To buyers, I'd say look at the total cost of

ownership, but also think about the kind

of tyres you want to make and assess the

performance needed for each operation

within that envelope. In many cases,

balancing initial cost against overall

quality can bring the amortisation time

down, so reducing the overall financial

risk.

“To buyers, I'd say

look at the total cost

of ownership, but

also think about the

kind of tyres you

want to make and

assess the

performance

needed for each

operation within

that envelope”

RMW

30

Page 31: Know a Leader - David Shaw - Rubber & Tyre
Page 32: Know a Leader - David Shaw - Rubber & Tyre

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