Pirelli Gains In China As World’s No. 2 Economy Recovers From Pandemic

Pirelli, the Italian tire maker, is seeing year-on-year gains in its China business as the country’s economic recovery from the COVID-19 pandemic quickens, Asia-Pacific CEO Guiliano Menassi said in an interview.

Business in recent months has been “better than 2019” year on year, Menassi said on the sidelines of “Italian Design Icons,” a three-day event held in Shanghai through Sunday to promote the country’s designs in China.

The gathering of 15 brands attracted more than 3,000 visitors on Saturday alone, underscoring China’s economic resilience – at least for now – amid the pandemic. China’s GDP increased by 4.9% in the third quarter from a year ago. That’s better than a 6.8% decline in the first quarter and a 3.2% gain in the second quarter from a year ago.  Auto sales in the world’s second-largest economy have also been on the mend. Purchases rose by 12.5% from a year earlier in October to 2.6 million vehicles. 

Pirelli, which is more than 30% owned by ChemChina, a Chinese state-owned business, sees itself well positioned to gain from China’s auto industry recovery.  That’s in part because it has invested in three plants since it entered the China market in 2005; another advantage is that it is working with suppliers of EVs that are currently among the country’s best-sellers.

“We have the right technology for EVs,” said Menassi. “We are ready to take advantage of this growth. “ Customers in China include VW, Audi, BMW, Geely and Nio. Pirelli expects to continue to invest in China next year, Menassi said. “The market is growing.  We already have our assets. We will continue to invest in R&D and technology.”

Recovery in China is helping to support Pirelli’s overall business in a year in which European sales are under pressure do to COVID-19.  The “2020 market outlook improves thanks to original equipment in Apac and North America, but (the) outlook  (is) cautious for Europe because of recent anti-Covid measures following the resurgence of the pandemic,” the company said in a statement earlier this month.

Around 20% of global sales come from China, where Pirelli employs some 4,000 people.

Other participating brands in the Shanghai event – organized by Eastant Communication & Events — were Ansaldo Breda, Casappa, Comau, Ducati, FAAM, iGuzzini, Itema, Maserati, Poltrona, Frau, Technogym and UFI Filters.

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@rflannerychina