Italy’s Pirelli Sets New Targets, Shifts Focus to High-End Tires

Pirelli generated 74% of sales from high-value lines last year.

Photographer: Erica Canepa/Bloomberg

Italian tire maker Pirelli SpA announced a new medium-term business plan with fresh financial goals and increased investment in high-value products as it targets a return to pre-pandemic levels as soon as next year.

Pirelli, whose biggest investor is China National Chemical Corp Ltd, or ChemChina, sees 2022 revenue at about 5.1 billion euros ($6 billion) to 5.3 billion euros, higher than a Bloomberg consensus estimate of 5.05 billion euros.

The company also forecasts margin for adjusted earnings before interest and taxes rising from about 17% next year to up to 20% in 2025.

The new plan “remains centered on high value” aiming to strengthen positioning in China and market share in original equipment for electric vehicles, the company said.

‘High Value’

Pirelli is targeting bringing the incidence of so-called “car high value” on original equipment total volumes to 70% in 2025 from approximately 60% in 2019.

Pirelli, which makes tires for luxury brands including Ferrari NV, Porsche and Bentley, last year generated 74% of sales from high-value lines.

Earlier this month Executive Vice Chairman and Chief Executive Officer Marco Tronchetti Provera nominated Giorgio Luca Bruno as deputy CEO, to begin after the June 15 shareholders meeting.

Pirelli shares have risen 19% since January, to 5.3 euros, giving the company a market value of about 5.3 billion euros.

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