Italy-headquartered tyremaker Pirelli is set to resume production at its plants in Carlisle and Burton, the UK from May 18. The company will work at a reduced rate, parallel with market demand.
Pirelli’s first quarter was impacted by the COVID-19 lockdown which led to a fall in consumption and production of automobiles, according to the company report. Car tyres sales volume dropped by 20pc in Q1 (Jan-March), comprising a 22.7pc fall in original equipment channel and 19.3pc drop in replacement segment.
COVID-19 halted operations at auto plants across countries. In the absence of demand and for the safety of workers, the company had suspended various operations. China’s road to recovery has instilled a lot of changes in Pirelli’s action plans for 2020 to prepare for a recovery phase. The company is in process of gradually reopening its plants with the adoption of new healthcare rules. The company has set a 130mn euros for plant management and improvement of product mix.
Pirelli’s net profit in Q1 was around EUR38.5mn ($41.63mn) down by 62pc from the prior year. Revenues fell by 20pc to EUR1,051.6mn in Q1 from the prior year quarter.
Tyre manufacturers use zinc oxide for the vulcanization of rubber. Zinc oxide demand is likely to pick up in the region which would boost demand for zinc dross if tyre companies ramp up production.