Bridgestone 2003 Annual Report Download - page 11

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09
2003 ANNUAL REPORT
The Bridgestone Group’s
global support network
for airlines and other
aircraft operators
includes retreading
plants in Tokyo; Hong
Kong; Miami, United
States (photo on right);
and Frameries, Belgium.
Testing and development
work at the Bridgestone
technical center in Tokyo
(center) supports contin-
uing improvements in
aircraft tire quality and
performance.
We maintain distribution depots for aircraft tires near airports at more than 20 sites around
the world.
While insisting on continuing advances in safety and durability, airlines are also insistent in
regard to cost. Our strengths in product development and manufacturing position us to respond
cost-competitively to customer needs and wants.
Results
Our sales of aircraft tires increased slightly in 2003, to about $100 million.
Sales remained weak in the first half of the year, but they improved
markedly in the second half. Our sales performance reflected trends in the
airline industry, but we outperformed the industry somewhat and posted
an increase in market share.
Overall passenger and freight capacity increased 2.5% on international
routes in 2003, according to the International Air Transport Association
(IATA). Anticipating a recovery in demand, airlines increased their passen-
ger capacity 0.1% on international routes. The Iraq war and the SARS out-
break belied their expectations initially, and passenger volume declined in
the first half, but it began to recover in the second half. International pas-
senger volume was down 2.4% for the full year. In contrast, international
air freight volume expanded 4.9%.
Outlook
Our business in aircraft tires is poised for solid growth in 2004. The recovery in international pas-
senger volume that began in the second half of 2003 is gaining momentum. Our continuing rela-
tionship with Boeing and our new supply relationship with Airbus also bode well for our business
prospects in this product sector. We will need to cope with the appreciation of the yen, however,
to reinforce the cost-competitiveness of our aircraft tires manufactured in Japan.
Airbus (top) will offer Bridgestone tires on its A380
jetliner, which airlines are preparing to put into service
in March 2006. Boeing (above) has been installing
Bridgestone tires on its airliners since 1996.
Airbus S.A.S. announced
in June 2003 that it would
install Bridgestone tires on its upcoming A380
airliner. Airlines have installed our tires on
Airbus aircraft for years, but the supply con-
tract for the A380 was our first with Airbus.
In November, Airbus announced that it would
install Bridgestone tires on its entire line of
commercial airliners.
2003
HIGHLIGHTS