Bridgestone 2008 Annual Report Download - page 30

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INTERNAL MANUFACTURING OF RAW MATERIALS
(VERTICAL INTEGRATION)
The Bridgestone Group is working to strengthen vertical integration, with an emphasis on
the integrated and effective use of resources from upstream to downstream. The aim of
vertical integration is to supply markets with nal products created through an efcient, high-
quality manufacturing process based on a production system that is integrated from raw
materials to nished goods. In raw materials, we are strengthening the development and
production of strategic raw materials that offer high added value and facilitate differentiation
from the operations of competitors. For example, eco-friendly tires for trucks and buses are
made with high-purity natural rubber, tires made possible by improved production methods
at our internal plants in rubber-producing countries. Moreover, we use internally produced
steel cord in large and ultralarge off-the-road tires and large tires for trucks and buses. And
in production divisions, we have steadily expanded production bases to meet increased
future demand, with an emphasis on overall optimization of group operations on a global
basis. Recent initiatives include the October 2008 opening of a plant in Mexico for the
production of carbon black, a raw material used as a reinforcing material in tires. In December
2008, we ofcially opened a plant for the production of synthetic rubber in Guangdong
Province, China.
However, increasing the ratio of internally produced materials is not, in itself, one of our
goals, and accordingly we have not set a specic performance target for this ratio. Moreover,
with consideration for overall Group prot, in certain cases we will acquire externally
produced raw materials that offer high quality at good prices. Accordingly, our policy is to
build a raw materials procurement strategy with a balance between internally and externally
produced materials, and, on that basis, to implement stable procurement of ever higher-
quality materials at competitive costs.
INITIATIVES AND PROGRESS OF MTP2008
KEY STRATEGY 2
Synthetic rubber plant in China Carbon black plant in Mexico
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