Pirelli 2021-22 | 2025 Industrial Plan

The Pirelli & C. Board of Directors approved the 2020 consolidated results and the 2021-2022|2025 Industrial Plan, which will be illustrated to the financial community today by the Executive Vice Chairman and CEO, Marco Tronchetti Provera, and by the Top Management.

The emergency triggered by Covid-19 saw the company respond to the crisis in a unified manner, thanks also to the experience gained in China since the beginning of the pandemic, accelerating data driven processes following the greater use of virtualization, and further focusing on sustainability, at the centre of human capital management, the product life cycle and the supply chain.

THE SCENARIO

The Pirelli 2021-2022|25 Industrial Plan includes two distinct phases at the macroeconomic level:

• 2021-2022: phase characterised by a substantial rebound in global GDP (with an average annual rate equal to +4.6%, driven by China with +6.6% and USA with +4.9%), linked to the vaccination campaign. A general appreciation of the euro is expected, in particular against the dollar;
• 2023-2025: phase of stabilisation both of growth (with an expected average annual rate in the period globally of 3.1%, again driven by China with +5.3%), and the currency market.

At the demographic level, in 2025 there will be over 500 million “high-end” consumers with priorities redefined by Covid, more focused on: well-being and safety, environmental impact, digital economy and the demand for services, with effects on purchasing methods, increasingly online also in the tyre sector.

At the level of mobility, after the drop in 2020, the total “miles driven” at the global level will grow rapidly to reach approximately 11.8 trillion miles in 2025 (>13 trillion in the previous plan). This will highlight two trends: a pronounced preference post-Covid for the use of private cars even in the long term (by 2025 miles driven will be around 10 trillion in line with the old plan) with a more contained use of new forms of mobility (e.g. Car sharing, car rental, leasing) and growing use of two-wheelers. An important factor will be the increasing use of electric vehicles: in 2025 they will comprise 35% of Premium and Prestige car production (30% in the previous plan) and 11% of the global car parc (9% in the previous plan). This sets a considerable technological challenge and places a significant competitive barrier for the development of tyres that must support heavier loads, have lower rolling resistance, offer greater grip and a lower noise level.

For the car market it is expected:

• car production: will grow by an annual average of 7% in 2020-2022 and by an annual average of 2% in 2022-2025. For Premium and Prestige the growth will be …

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Source: Pirelli