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Happy New Year, and for that matter, happy new decade. Let's hope the 90s provide a little more stability to the rubber industry than the 80s did, but I doubt it. The political events in Eastern Europe coupled with the market unification of the remainder of Europe scheduled for 1992 already portend significant changes will take place. It might be hard to top the 80s with its friendly and hostile takeovers, leveraged buy-outs and aggressive maneuvers by foreign rubber firms in the North American market.

The tire segment of the industry bore most of the change in the decade, but the non-tire sector appears to be going through similar changes. Akron, the rubber capital of the world, only produces specialty tires. Firestone is owned by Bridgestone. General Tire is owned by Continental. Armstrong was bought by Pirelli. Uniroyal and BFGoodrich merged tire operations and Michelin will soon own that. Goodyear survived a hostile takeover attempt but at a serious cost. Goodyear also lost its number one ranking in the rubber industry. Polysar is now Nova Corp. I could go on.

It's hard to imagine the decade we just entered being as hectic but you had better be prepared. Some predicted a restructuring of the industry, but no one guessed the severity or quickness with which it came about. So what lies ahead for the 90s? Obviously political events will have a major bearing on business. Just when companies were planning strategies for the upcoming European Economic Community, Eastern Europe becomes a factor. The effects of the numerous LBOs will begin to bear on company decisions as well. But I'm guessing that all of these factors are going to take a back seat to the environment in the coming 10 years.

The people are going to demand (it has already begun) cleaner air, water, land and workplace. Company planners would be wise to scrutinize each operation and ascertain just how to reduce or eliminate pollution in each area because the population is going to demand it. It would behoove the industry, just as the plastics industry is doing, to initiate the action instead of having it legislated for you. Indiscriminate pollution, which appears to have little concern for the environment, will not be tolerated. The industry must start working with governments on a local and national basis to show that a cleaner environment is also our concern and not something that we're going to do only if forced. Because if it comes to that, you most likely won't like the legislation.
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Title Annotation:changes in rubber industry
Author:Smith, Don R.
Publication:Rubber World
Article Type:editorial
Date:Jan 1, 1990
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