Bridgestone's Bandag strategy an evolving business model

Nashville, Tennessee - Bridgestone Americas Holding Inc. will not comment on how it will integrate Bandag Inc.'s business units into its own. But a Bridgestone/Firestone spokeswoman said one reason the tyre maker pursued the merger is to go to market the same way its competitors do: with a full line of new tyres and retread services.

"In order for us to keep pace with the market and prepare for the future, it's critical that we take a look at our business model and continue to evolve it," she said. "When we combine our business with Bandag, we're going to be able to better serve (fleet) customers. They're going to get a comprehensive, tyre maintenance solution, and it's going to be backed by a complete line of new truck tyre and retread offerings. That's really the beauty of this. In the US and Canada, we share a very similar distribution network."

In Europe, the response was similar, with a spokesman saying it was too early to comment on how the Bandag operations would be integrated with Bridgestone's retread business. He said that many of the dealerships work with both Bridgestone and Bandag and the informaton on dealers and customers would certainly provide opportunities for synergy. Bandag generates around 20 percent of its revenues from the EMEA region.

Bridgestone Americas plans to operate Bandag as a wholly owned subsidiary after the deal closes. She declined to discuss if Bandag Chairman and CEO Martin Carver will stay on to run the unit but noted that "he is an integral part of that business and he is going to be a resource and a valued adviser going forward."

From Rubber & Plastics News (A Crain publication)