Internationalism, technology, talent, speed and culture are part of Pirelli's past, present and future
With our technologies, drivers get the most out of their cars and the driving experience, under all conditions; this is epitomized by the Brand's motto: “Power is nothing without Control”.
The ambition has always been there. From its founding in the 19th century, Pirelli has been a fusion of pioneering technology and an international outlook. A combination of Italian design and culture with innovation; challenging the accepted ways. Today, that alchemy of man, machine and geography remains. We believe that technology and people are the way to compete in the global market. Pirelli’s business model is based on a simple premise, a journey. First, the company develops tyres with carmakers, then we focus on the aftermarket of tyre dealers, tyre specialists and car dealers. Sales to carmakers of tyres to go on new vehicles comprise about 24% of total sales; 76% comes from selling further sets of tyres in the aftermarket. At one end is the carmaker; at the other, the car driver. Pirelli aims to connect the two throughout the value chain. With Pirelli technologies, drivers get the most out of their cars and the driving experience, under all conditions; this is epitomized by the Brand's motto: “Power is nothing without Control”.
At the top of the market
Pirelli has two divisions – Consumer (tyres for cars and motorbikes) and Industrial (tyres for trucks, buses and farming vehicles). The Consumer division accounts for just over three quarters of total sales revenue, with more than 70% coming from car tyres and approximately 7% from motorbike products. The Industrial division produces the remaining quarter - 20% from truck tyre sales and 3% farming vehicle tyres.
Pirelli’s superior R&D and desirable brand have helped us to forge close partnerships with the world’s highend carmakers - Audi, Mercedes, BMW, Jaguar Land Rover and Volvo. The group has an even stronger position in the sector, serving the likes of Ferrari, Maserati, Lamborghini, Porsche, Bentley, Aston Martin and McLaren. We are proud of the large number of tyre approvals, or ‘homologations’ to use the technical term, that Pirelli has been awarded by car manufacturers for its products to be fitted on new models. There are currently more than 1,500 homologated Pirelli products. In the motorbike business, the company has two brands: Pirelli and Metzeler. The latter is a German brand bought by Pirelli in the early 1980s. The two have significant presence in the premium segment in mature markets such as Europe and the United States. Pirelli’s Industrial division has a selective regional strategy. The company holds leadership positions in South America, the Middle East and Africa. We are also a leader in agricultural tyres in South America.
Pirelli’s superior R&D and desirable brand have helped us to forge close partnerships with the world’s highend carmakers - Audi, Mercedes, BMW, Jaguar Land Rover and Volvo.
Pirelli’s technological heritage
Product innovation was always part of the Pirelli story. The company was founded in Milan in 1872 by Giovanni Battista Pirelli, a 24-year-old engineer who identified early on the industrial potential of rubber. The fledgling business initially made rubber coats for policemen and firemen, along with rubber belts for the wheels of machinery.
As an early statement of its international and technological intent, Pirelli started to produce insulated undersea cables for telegraphy, laying lines in the Mediterranean in the late 19th century. Its first factory outside Italy was in Spain; the first car tyre was patented in 1901. To complete the story, the distinctive elongated ‘P’ logo originated in New York in 1908.
Pioneering technology informed Pirelli’s work from its inception. Our tyre designs led the way for other manufacturers. We developed the Superflex Stella Bianca, our first sporting tyre, back in 1927, while radial tyres were launched as long ago as 1951.
Pirelli’s patents also reinforce our ambitions in markets. The PZero, a pioneering ultra-low tyre with asymmetric tread pattern for prestige models, came on the market in 1987 and the Cinturato P7, the first high-performance tyre with a green philosophy, was launched in 2009.
Pirelli is the exclusive tyre supplier to Formula One for a second three-year period that started in 2014. This is a brilliant showcase for our engineering and research, emphasising Pirelli’s global footprint and constant search for technological perfection. The company is also active in 150 other car and motorbike races around the world.
A truly global company
Today, Pirelli’s international footprint – we have a commercial presence in more than 160 countries – is bigger than ever, affording us lower costs and the ability to meet the demands of rapidly expanding economies.
Pirelli has 37,500 employees in 160 countries. We are in present Europe (30%), South America (37%), North America (4%), Asia Pacific (11%), MEAI (9%) and Russia (9%). Our 19 facilities have a capacity of 72 million units for Consumer and 6.3 million for Industrial.
Industrial division production is entirely located in lower-cost, high-growth regions. Some 78% of Consumer manufacturing is also in these areas, a figure set to grow to 80% by 2017 with the expansion of facilities in Russia, Mexico, Romania and China.
The company’s global reach and focus on high growth areas is underlined by the sources of revenue. Less than half of Pirelli’s revenue comes from mature markets – 34% from Europe, 12% from North America. Of the rapidly growing economies, 4% of revenue originates from Russia; 33% is in South America; 8% in the Middle East and Africa; and 9% in the Asia Pacific region.
Pirelli has 37,500 employees
in 160 countries.
Pirelli’s internationalism is also reflected in its shareholder base. The company is 44% owned by investors outside Italy, predominantly the US and the UK, including a significant presence of socially responsible investors (SRIs). Among others, 26% is held by Camfin and 12% by retail investors. Independence and diversity are paramount in its governance. The composition of Pirelli’s board and committees is inspired by international best practice.
As a significant business on the world stage, we fully integrate our economic strategy with environmental and social targets, thus pursuing value creation through the interaction of financial capital, production capital, intellectual, human, natural, social and relational capital.
This commitment is reflected in Pirelli’s inclusion in the world’s major global sustainability indices, such as the Dow Jones Sustainability index where the group has led the ATX Auto Components sector for eight years, the FTSE4Good index where in 2014 we reached a 100/100 rating, and the Climate Disclosure Leadership Index, where we outperformed our peers. Since 2004 Pirelli has been an active member of the United Nations Global Compact, and sits in the Global Compact Lead Steering Committee.
An emotional experience
Pirelli’s market positioning also stems from its supporting activities, the Pirelli Calendar, the Foundation and PZero Design.
The Pirelli Foundation, founded in 2009 by Group and the Pirelli family, houses and develops the company’s heritage and promotes contemporary corporate culture through exhibitions, conferences and collaborations with other cultural institutions. HangarBicocca is a contemporary art space near the company’s Milan headquarters with a 15,000 square metre exhibition area. We believe that contemporary art is a source of future innovation.
The Pirelli Calendar, now in its 51st year, has been shot by the greats of photography such as Stephen Meisel, Steve McCurry, Patrick Demarchelier, Richard Avedon, Peter Lindbergh, Annie Leibovitz. Fashion luminaries including Naomi Campbell, Jennifer Lopez, Sophia Loren and Kate Moss have all modelled for the calendar. The PZero brand houses the company’s design and lifestyle projects, building on our heritage and enhancing the core business.
This mixture of internationalism, technological leadership, talent, speed, responsibility and culture is a mark of Pirelli’s past, present and future. We will continue to harness people skills and energy along with science, data and design to reach ever greater heights. That means introducing new technologies, setting trends, advancing sustainability and governance.