2021 sees the iconic German tire manufacturer and tech focused automotive futurists, Continental celebrate 150 years of business – a significant landmark by any reckoning, even more so when it lands during a period of extreme disruption to trade and social norms, such as the Covid-19 pandemic.
For Continental Thailand, the last 18 months have been a mixture of positive and negatives but one thing is for sure, this is a company that has responded thoughtfully and intelligently to the gauntlet thrown down by a disease that continues to perplex governments and wreak havoc across the world.
To find out more I spoke to Peter Rankl, President ASEAN Continental Automotive Bangkok and Bobby Siow, Managing Director, Continental Tyres (Thailand) to find out how Continental has coped with lockdown, the impact on their bottom line and more.
Continental is celebrating its 150th birthday this year and in that time it would have seen many changes. What kind of celebrations have been put together to mark this milestone?
Peter Rankl (PR) Yes, I would say it's a huge event for any company that can celebrate 150 years, and it’s a major milestone for us. It’s on the 8th October, this year, and we will have, on a global basis, several celebrations together with employees, and as well with our customers.
Bobby Siow (BS) We plan to run some consumer campaigns to make sure that they are aware of our organization’s 150 years in business, such as a lucky draw, as well as special communication events with our dealers – to make sure that they understand their value to our business as long term partners.
We want to continue moving forward with them not only for another 150 years but for many years to come.
What have been the standout investments during Continental’s time in Thailand?
BS) I think the most recent one must be our plant in Rayong producing passenger and light truck tires, which we started back in 2019 for an investment of about 250 million euros. Currently, we are still at the first stage of the development but we hope to produce four million tires soon, and later on the plant can expand further capacity in the long run.
PR) There's a lot of open land at the plant where we can easily duplicate existing buildings. We can produce, as Bobby said, up to four million passenger and light truck premium tires per year for Thailand and the whole of APAC starting next year we will ramp-up our motorbike tire business to an additional 780,000 units.
BS) The plan is not only to produce tires for the Thai market; it is to export tires all over the region. Hence we are investing a lot into the latest technology to make sure that the plant is in line with the rest of our high-tech plants around the world.
Digitalisation is of paramount importance to modern business and the pandemic has been a catalyst to speed up this process, how does Continental use technology to maintain operations and keep both employees and customers happy?
BS) A big change has been the shift from working in the office to working from home. And, now that everybody is using face to face contact [through Zoom, Facetime, Microsoft Teams etc.] we have tried to become even more digitalised, not only with our employees but also with our customers.
We have developed our internal online structures so customer, in this case our tire dealers, who cannot make orders through a phone call are able to do so online. Now, they don't have to call us – they can see our inventory online, make an order and even receive the tires despite being stuck in a lockdown.
Has the shift to working from home been successful and is it something you will continue once the crisis has passed?
PR) It’s a good question. We have debated this a lot internally and I think it’s the same for Automotive, but going forward it will be a mix of coming to the office and working from home in the future.
However, it also depends on the type of work an employee does. For some roles it is fine for them, to work at home, for others it is important they come into work. Conversely, if you want to create a team spirit, if you want to build a team culture, working together in one location is mandatory.
Tough times are often also moments to reflect, plan new strategies and seize fresh opportunities. What positives has the company taken from these difficult times?
PR) COVID has caused a major global downturn for the automotive industry, with an even more dramatic impact in ASEAN. With a market decline of 30% from pre-pandemic to 2020 – ASEAN was one of the most affected automotive markets. However, this year we will see a partial recovery – but we expect it will take until 2023 for a full return to previous levels due to lower demand in ASEAN, the shortage of electronics components and the current limitations for international export.
With the government’s vaccination programme and efforts to goal to reopen the country, growth in the country’s tire market is expected to regain momentum and grow again in 2022.
Furthermore, we truly believe that by the end of the decade, we will have new record sales and everything will be much better.
On the positive side, the ASEAN market is moving towards better-equipped vehicles, which means the take-up rate for the latest technologies is growing for all OEMs (Original Equipment Manufacturer). With locations in Thailand, Malaysia, Philippines, Singapore and Indonesia, Continental is well prepared to support future growth with the introduction of new features.
