1. FUTINAL Conference 5-7 December 2006 Praia Grande/SP, Brazil Michael Wolters, ICEM Chemical and Rubber Industry Officer

2. Contents Forecast: natural rubber (NR) world market prices, demands and supply Non-tire rubber sector / newest developments Tire technology Strategic and economic approach of the mayor tire companies Challenges for the trade unions 2

3. Price of natural rubber (NR) 3

4. Forecast: NR consumption (in m tons) NR shortage in 2010 at the latest! 4

5. Use of natural rubber Gloves and condoms:100 % Truck tires: 80 % Passenger tires: 27 % The tire industry as a whole needs 60 % of all NR production. 5

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7. Non-tire rubber products (examples): Automotive hoses Hoses assemblies Automotive interior trim Multiple V-ribbed belts, timing belts Conveyor belts Printing blankets Sealing systems Engine mounts Vibration control Air springs gaskets 7

8. More and more a mixture between electrics, metal and rubber 8

9. Tire technology I Truck tire :  Very wide tires (30-inch) instead of two tires on one axle  Lighter tires which can be used longer (e.g durable technology by Michelin)  Less rolling resistance = less fuels  Retreated tires with better quality 9

10. Tire technology II Off-the road tire (OTR) demand is strongly increasing, especially in the mining sector 10

11. Tire technology III Passenger tire:  Run-flat  Multi air chamber 11

12. Tire technology IV New production technology:  only 10 % of the former space  only 1/3 of the former workers  Examples:  ATOM / Toyo tyre  BIRD / Bridgestone-Firestone  C3M / Michelin  MIRS / Pirelli 12

13. Strategic and economic approach of the mayor tire companies 1.Bridgestone 2.Michelin 3.Goodyear 4.Continental 5.Pirelli 13

14. Bridgestone-Firestone Net sales (9M/2006): 17.9 billion US$ + 13,0 % Profit declines Since 2006 the Number one of all tire makers 14

15. Michelin Net sales (9M/2006): 15,2 billion US$ + 6,4 % Profit decline Number 2 of tire makers New US retirement pension plan 15

16. Goodyear Net sales (9M/2006): 15,282 billion US$ +3,3% Profit decline Still severe financial problems A long ongoing strike in the US since 5th of October 2006 16

17. Continental Net sales (9M/2006): 13,7 billion US$ + 6,9 % Profit decline Figure of employees increasing (roughly 85 000) Closing of tire production in Charlotte, NC (USA) 17

18. Pirelli Net sales (9M/2006): 4,5 billion US$ +9,1 % Profit decreasing Strong share in Latin American tire market IPO of ( a part of ) the tire business of the Pirelli Group is still on the agenda 18

19. Challenges for the trade unions in Latin America Goodyear’s purpose of selling Engineering Products What will happen to Pirelli’s shares in future Looking for niche products in the tire sector Looking for a more global strategy to save the future of the regional tire plants Being capable to discuss in an economic way with the local management Be aware of impacts and changes in other parts of the world (e.g. strikes, shifting of production to other places) Building capacity for a continuous process of exchange of information, coordination of actions in FUTINAL. 19