Milena Tosic, representative of Tigar Tyres Serbia - In 2015, we are planning export totaling EUR 280 m

Biginvestment of Tigar Tyres attracted great attention of the public upon openingof new section in Pirot in October 2014and this year as well. Firstly, the association of journalists declared TigarTyres Serbia the company of the year and then the award for investment of theyear, Aurea, delivered by our portal, went to BIG Tigar project.

InOctober 2014, the company opened new tyre production department and when theentire project BIG Tigar is completed (bythe end of 2016) the investment will reach EUR 215 m and 500 new people will behired.

We talkedwith the importance of this huge investment, plans of Tigar Tyres, new hireswith representative of Tigar Tyres Serbia, Milena Tosic.

eKapija: Tell us more about the products thatwill be produced in the new plant - BIG TIGAR.

BIGTigar is the name of the investment project meant to increase the productioncapacity in the Tigar Tyres plant in Pirot. Due to this project, Tigar Tyres willmanufacture at a wider scale Passenger Car, Light Truck as well as SUV 4x4entry level tyres. For now, these tyres are manufactured in 8 different brandsfor the purposes of serving clients in Europe, CIS countries, Africa, MiddleEast: Tigar, Riken, Kormoran, Taurus,Orum, Strial. Recently, Tigar Tyres started the production of two new brands Idilisand Sebring.

eKapija: Why did you opt for such a large numberof items in one factory (1700)?

A broadrange of available dimensions is one of the elements of success as allows us toserve a larger variety of market needs. The client want to have all dimensions– from the smallest to the biggest ones of 19 inch and more, of variouspatterns, different brands, in winter and summer thread patterns. Sometimes weare producing some exclusive brands intended to be sold to only one client. Weare prepared to introduce new ranges according to the client’s needs, the mostrecent one being the 4x4 tires range. All of this leads to increasing thenumber of dimensions, and for now this numbers arrives to 1.700.

eKapija: What affects more the performances of a tire - materials used in manufacturing orprocessing method?

A tyre is a very complexproduct that has to provide different performances important for users and canincrease the safety and longevity and even help saving fuel. Imagine that thetire is the only contact of the car with the road, not bigger than a human hand,and has to face daily aggression from the road, weather conditions and drivingstyle. When designing a tire, the usage, purpose of the tire is considered andall the elements are important and can make a difference in reaching certainperformances, from structure, to composition and manufacturing method.

The performance of a tire isdetermined also by the relationship between the materials used and thearchitecture of the components. A tireis made up of many components of rubber, textile and steel that when assembledgive a specific architecture that determines the performance.

eKapija: Can you give us an example, let`s say - how important is the fact that the new facility BIG TIGAR has some of the most advanced machines in this industry?

The machines in the newfactory feature the latest technological innovations in the world of rubbermanufacturing industry. The tires that will be produced in the new plant arecalled entry or budget level tires for which our customers require a widerange, good quality, reliable service and fast delivery, offered at the rightprice. Modern technology and equipment engaged in the factory are all elementsused to achieve these objectives and help us adapt to the market’s needs.

eKapija: When will the BIG TIGAR reach fullcapacity? It is said that 500 workers will be employed, how many has beenemployed so far?

The production process in theextended section of Tigar Tyres has begun in September 2014. The plant willreach its full capacity in early 2016, with a production increase of 4,000,000 tyresper year that is in total 12,000,000 tyres per year having in mind the existingproduction capacities in Tigar Tyres.

To support the Tigar Tyresexpansion plan, around 150 new people have been employed and trained by the endof 2014, out of the total plan of 500.. The recruiting process for the other350 positions will continue in 2015 and will proceed in the first trimester of2016.

eKapija: When you recruit new people, how long their training lasts? What educational profileis required and is there enough trained staff in Pirot?

When recruiting new employees,professional and technical competencies derived from previous education andexperience are naturally of great importance. In Tigar Tyres we give an evengreater emphasis to the candidate’s potential, the estimated career path andprofessional development that each of the possible candidates can achievethrough various engagements and training during their work.

Each new Tigar Tyres employee is trained for the future workplace according toa predefined plan. In addition to the basic training provided during the periodof integration (which includes induction trainings such as the safety training,collective employment contract training) there are separate specializedtrainings concerning the specific needs and requirements of a particularworkplace (lasting from 1 up to 9 months, depending on the position).

So far, the expert services ofTigar Tyres managed to provide adequate profiles of mechanical, electrical andrubber manufacturing professions from Pirot and its surroundings. Theseprofessions exist in Pirot high schools with which Tigar Tyres has achieved aremarkable collaboration, and a number of outstanding students receivescholarships during their further education at university studies.

eKapija: How much did Tigar Tyres exported so far (with the old drive)? How much will beexported from the new facility BIG TIGAR?

Currently,Tigar Tyres exports approximately 90% of the total production. In 2014 TigarTyres was ranked the third exporter from Serbia, with exports in the amount of EUR 226million. This year we expect to have more than 280 million EUR in exports, as allthe additional production brought by the BIG Tigar project is dedicated to export.

When Tigar Tyres will reach full capacity ofproduction of 12 million tires, it would lead to over 420 million of exports in2016.

eKapija: Which export market is the strongest at the moment? How much do you export to Russia,what`s the situation there, do you record growth?

Tires manufactured by Tigar Tyres are exported toalmost all countries of Europe, and in the last few years, especially in thegrowing markets of Russia and CIS, Middle East, Africa. Exports to Russia doubledin just 3 years (from 2010 to 2013) and reached a value of 20 million euros,with a tendency of further growth.

eKapija: Will it affect future plans in Pirot? Do you expect problems in theplacement of products from the new plant, since the automotive industry aroundthe world is facing difficulties?

The Michelin Group hasclearly set its growth ambition for the years to come and the investment inTigar Tyres is in line with this ambition and will contribute to reach thegrowth objectives. It will serve the Group development in the Entry-level tiressegment.

Our factory in Pirot is the Group’s onlyproduction facility in Europe that manufactures entry-level passenger car tiresunder the Tigar, Kormoran and Riken brands. This market segment is currentlyexpanding rapidly, especially in Central and Eastern Europe, Russia and the CIScountries and our additional production capacity will enable us to respond moreeffectively to this growing demand.

Furthermore, the value and the content of thisinvestment demonstrate the commitment from Michelin Group to both serve itsclients in the Entry-Level segment with the highest standards and to create inSerbia a very competitive manufacturing entity for the future.

eKapija: What are the plans for further expansion of Tigar Tyres plant, having in mind thatthe company owns more land which can be used for construction in the factory complex? Is there a possibility of another hall to be constructed next to BIG TIGAR? At the opening ceremony of the new plant, we heard that this is not the end of theinvestment that Tigar Tyres is considering.

Currently, our top priority isthe final implementation of this investment worth of 215 million EUR, whichalso implies achieving full capacity, from 8 to 12million tires in 2016, hiringand training 500 people, which means 2,700 employees in 2016. We aim as well theconquest of new brands and designs in 2015 and producing SUV tire for 4x4.

eKapija:What are the plans for investment in infrastructure and landscaping of the complexin Pirot, improved means of transport, etc.?

Concurrently the investment ingrowing the production capacities of Tigar Tyres strives to give its maximum contributionto the local community in Pirot and grow the quality of life. Our true endeavorand wish is that Pirot and Tigar Tyres grow together and is materialized alsoin a dedicated project entitled Growing Together.

The focus of our engagement for growing the local community is to provide trainingand education through collaboration with primary and secondary schools in Pirotand Babusnica, providing also equipment furniture and computer equipment; improvinghealth services in the municipality of Pirot by purchasing specific equipment; increasethe safety in traffic, and Tigar Tyres continues to work with the local cityofficials in order to advance critical traffic spots in the city and raise thetraffic culture to a higher level.

eKapija: Did "Michelin" completely resolve all property-legal relationswith neighbouring company Tigar ad?

Since the founding of our company, Michelin - that is Tigar Tyres in Serbia, and Tigar ADand have established a good and professional relationship based on serviceagreements, or contracts of sale and all obligations under the existing contractsare completed. The same goes for agreements concerning the legal propertyrelationships. All previous agreements that have been concluded between thesetwo companies have been complied with.

eKapija: Can you explain us the significance of BIG TIGAR for the entire company Michelin?

BIG Tigar is the investmentproject meant to increase the production capacity of the Tigar Tyre factory inPirot. The factory in Pirot is the only one within Michelin Group thatmanufactures budget tire brands such as Tiger, Riken, Kormoran, Taurus, Strial,Orium. Budget tires represent a tire segment, which is currently in expansion,especially in Central and Eastern Europe, Russia, CIS countries. Tigar Tyres isa plant with a strategic importance for the Michelin Group with a clear role tocontribute to the long term growth objectives.

Moreover, withthe BIG Tigar project we brought a flexible business model in our manufacturingunit in Pirot. This means that Tigar Tyres will be able to serve specificclients’ needs and projects making this plant a reference point to the Groupfor future projects of this kind.