INTRODUCTION

1.1 About Rubber

Rubber (Sometimes called latex rubber ) is the common name of a chemical

substance with the ability to shrink and stretch . Technically it is a polymer naturally

found as a milky liquid (known as latex)in the sap of several types of plants, mainly

Hevea brasiliensis (euphorbiaceae) .The first rubber was the natural kind from the sap

of heveatrees in Central America.Charles Maria De La Condamine presented samples

of rubber to the academie royale des Sciences of France in 1736.In 1751 Francois

Fresneao read a paper to the Academie (Published in 1755) which describe many of the

properties of rubber.This has been referred to as first scientific paper on rubber. In

1770 ,British Chemist Joseph Priestley noticed that rubber was very good for removing

pencil marks on paper .

1.2 Types of Rubber

1.2.1 Natural Rubber

Natural rubber is an elastomer (an elastic hydrocarbon polymer)

that was originally derived from a milky colloidal suspension or latex found in the

sap of some plants. The purified form of natural rubber is the chemical

polyisoprene, which can also be produced synthetically. Natural rubber is used

extensively in many applications and products, as synthetic rubber. The major

commercial source of natural rubber latex is the Para rubber tree

(Heveabrasiliensis), a member of the spurge family, Euphorbiaceae. This is largely

because it responds to wounding by producing more latex. Owing to the presence

of a double bond in each repeat unit natural rubber is sensitive to ozone cracking.

There are two main solvents for rubber: turpentine and naphtha (petroleum). Natural

rubber coming from latex is mostly polymerized isoprene with a small percentage of

impurities in it .Natural rubber melts in heat and freeze in the cold , making it

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useless for many products .In 1844 Charles Good Year found a way to improve

natural rubber in chemical process known as vulcanization. This limits the range of

properties available to it. Also, there are limitations on the proportions of cis and

trans double bonds resulting from methods of polymerizing natural latex. These

limitations are overcome by the entry of Synthetic Rubber.

South America Was the main source of natural rubber during much of the 19th

century . However , in 1876 Henry wickham gathered thousands of seeds from Brazil

to Kew Gardens , England and sent them to Ceylon (Sri Lanka) , Indonesia,

Singapore and British Malaya Later , Malaya (now Malaysia) became the biggest

producer of rubber. Experimental efforts to grow rubber in India were started as early

as 1873 at the Botanical Garden Kolkata .First commercial rubber plantations in India

were established at Thattekadu in Kerala in 1902.

1.2.2 Synthetic Rubber

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Synthetic rubber can be made from the polymerization of a variety

of monomers including isoprene (2-methyl-1, 3-butadiene), 1, 3-butadiene,

chloroprene (2-chloro-1, 3-butadiene), and isobutylene (methylpropene) with a small

percentage of isoprene for cross-linking. These and other monomers can be mixed

in various desirable proportions to be copolymerized for a wide range of physical,

mechanical, and chemical properties. The monomers can be produced pure and the

addition of impurities or additives can be controlled by design to give optimal

properties. Polymerization of pure monomers can be better controlled to give a

desired proportion of cis and Trans double bonds

Synthetic rubber is any type of artificial elastomer, invariably a

polymer. An elastomer is a material with the mechanical (or material) property that it

can undergo much more elastic deformation under stress than most materials and

still return to its previous size without permanent deformation. Synthetic rubber

serves as a substitute for natural rubber in many cases, especially when improved

material properties are required. Nowadays synthetic rubber is used a great deal in

printing textile. In this case it is called rubber paste. In most cases titanium dioxide

is used with copolymerization and volatile matter in producing such synthetic rubber

for textile use. Moreover this kind of preparation can be considered to be the

pigment preparation based on titanium dioxide.

1.3 Uses of Rubber

Because of its elasticity, resilience, and toughness, rubber is the

basic constituent of many products used in the transportation, industrial, consumer,

hygienic and medical sectors. The use of rubber is widespread, ranging from

household to industrial products, entering the production stream at the intermediate

stage or as final products. Tires and tubes are the largest consumers of rubber. The

remaining 44% are taken up by the general rubber goods (GRG) sector, which

includes all products except tires and tubes.

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Rubber continues to hold an important place in tire consumption.

In particular, its superior tear strength and excellent resistance to heat up makes it

better suited for high-performance tires used on racing cars, trucks and buses, and

aircraft. Rubber tires are of two types: solid (or cushion) tires, in which the rubber

portion functions to carry the load and absorb shocks; and pneumatic tires, with

compressed air that fills the tire. The former are used on industrial machinery and

on military vehicles; pneumatic tires are used for almost all free-moving vehicles

(i.e., other than railroad cars). Pneumatic tires include tires for automobiles, trucks

and buses, (motor) bicycles and airplanes and "off-the-road" tyres for special

vehicles (such as construction vehicles and agricultural machinery). The distribution

channel for pneumatic and solid tyres is two-tired, consisting of original equipment

manufacturers (OEMs) and the replacement market.

1.4 Rubber in General Sector

Compared to vulcanized rubber, uncured rubber has relatively few uses.

It is used for cements; for adhesive, insulating, and friction tapes; and for crepe rubber

used in insulating blankets and footwear. Vulcanized rubber, on the other hand, has

numerous applications. Resistance to abrasion makes softer kinds of rubber valuable

for the treads of vehicle tires and conveyor belts, and makes hard rubber valuable for

pump housings and piping used.

Other significant uses of rubber are door and window profiles, hoses, belts,

matting, flooring and dampeners (anti-vibration mounts) for the automotive industry in

what is known as the "under the bonnet" products. Its elasticity makes it suitable for

various kinds of shock absorbers and for specialized machinery mountings designed to

reduce vibration. Being relatively impermeable to gases, rubber is useful in the

manufacture of articles such as air hoses, balloons, balls, and cushions. The resistance

of rubber to water and to the action of most fluid chemicals has led to its use in

rainwear, diving gear, and chemical and medicinal tubing, and as a lining for storage

tanks, processing equipment, and railroad tank cars. Because of their electrical

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resistance, soft rubber goods are used as insulation and for protective gloves, condoms,

shoes, and blankets, erasers and adhesives. Hard rubber is used for articles such as

telephone housings, parts for radio sets, meters, and other electrical instruments. The

coefficient of friction of rubber, which is high on dry surfaces and low on wet surfaces,

leads to the use of rubber both for power-transmission belting and for water-lubricated

bearings in deep-well pumps.

Additionally, rubber produced as a fiber sometimes called elastic, has

significant value for use in the textile industry because of its excellent elongation and

recovery properties. For these purposes, manufactured rubber fiber is made as either

an extruded round fiber or rectangular fibers that are cut into strips from extruded film.

Because of its low dye acceptance, feel and appearance, the rubber fiber is either

covered by yarn of another fiber or directly woven with other yarns into the fabric. In the

early 1900s, for example, rubber yarns were used in foundation garments. While rubber

is still used in textile manufacturing, its low tenacity limits its use in lightweight garments

because latex lacks resistance to oxidizing agents and is damaged by aging, sunlight,

oil, and perspiration. Seeking a way to address these shortcomings, the textile industry

has turned to Neoprene (polymer form of Chloroprene), a type of synthetic rubber as

well as another more commonly used elastomer fiber, spandex (also known as

elastane), because of their superiority to rubber in both strength and durability.

1.5 Rubber in Construction Sector

Rubber goods have a major role in the construction sector. Categories of Rubber used in Construction Industry products include:

Crossover Pads Dead Bed & Wear Sleeves Hydro blasting Molded Rubber Parts Pulley Lining/Lagging Repair Kits (Urethane, Epoxy, Ceramic) Rubber Lined Parts Specialty Coatings (In-house & field applications) Sprayable Coatings (In-house & field application)

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Urethane Sheet Goods

1.5.1 Crossover Pads

These high tensile strength polyurethane pads are used to protect

electrical or other cables, in the mineral processing and construction industries. 

They are manufactured from proprietary urethane compounds and are designed to

be chemical, temperature and abrasion resistant to resist years of continued abuse

from impact and the elements.  They are a cost-effective substitute to either burying

cables or running them overhead, where they can be a safety hazard.

1.5.2 Dead-Bed & Wear Sleeves

Wear sleeves protect launders, sumps, distributors and collection

boxes by having the material wear on itself instead of on structural surfaces

Features of Sleeves

High—slip surface promotes smooth slurry flow Unsurpassed wear

resistance provides excellent protection of metal, concrete and fiberglass structures

Lightweight sleeves are easy—to—install and replace, no tools or fasteners

required

Hydro Blasting

The coatings removal technology involves the use of Jet Edge

equipment. This well-designed equipment is based upon efficient water jet

technology. It provides for complete cleaning and preparation of all types of metal

substrates. The Jet Edge ultra-high pressure technology uses low volumes of

ordinary tap water. As a result, the cutting and cleaning process provides an

environmentally sound approach. Harsh chemicals, solvents and detergents are

completely eliminated. When compared with conventional water blasting at 10,000 -

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20,000 PSI, ultra-high pressure water results in substantial improvements in surface

condition, operational efficiency and reduced downtime.

1.5.3 Molded Rubber Parts

The superior abrasion, corrosion, and erosion compound can now be

utilized in situations where sheet rubber application is not feasible. Custom

engineering and design capabilities make it possible to create molded rubber

industrial parts to replace many metal and urethane parts subject to excessive

wear. Molded rubber parts are lighter than metal, and provide tighter fittings, while

matching or increasing the service life of the part. Lifter bars, screens, airbags, and

special fittings are just a few of the many possibilities

1.5.4 Repair Kits

It is an outstanding general-purpose two-component trowel grade

urethane compound. It can be easily trowelled to thicknesses of one inch on a

vertical surface without sagging.  Because it is a polyether base, it is excellent for

use as a protective lining against abrasion, heat, and humidity or moderate

concentrations of mineral acid or alkaline. It has been successfully used as a

grouting material to seal and protect joints in tanks and slurry pipelines and as a

high-build lining in areas of concentrated impact and abrasion

1.5.5 Rubber Lined Products

It offers complete rubber lining services for a broad range of

applications including: pulleys, rolls, cyclones, and tanks. They range in size from

small, one-pound parts to massive items weighing up to five tons. Rubber removal

can be performed through air, grit, or water blasting systems. With a variety of

rubber compounds we can meet almost any specifications or customers special

needs. Autoclave vulcanization is closely monitored and controlled to ensure the

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best possible bonding action Urethane sprays and coatings are the answer for

applications that require on site repair. Sprayable urethane is designed to protect all

surfaces and equipment that are exposed to any abrasive and corrosive

environments. These coatings are easy to repair, form and add reinforcement to

other highly durable protective linings. Sprayable coatings extend the operating life,

replacement, and maintenance costs of equipment and structures in areas with

vibration, impact, bending, flexing, and thermal cycling

1.5.6 Pulley Lining

With the largest autoclaves in the industry and the capability to handle

heavy parts, pulley size is never a problem. Only the highest quality pulley lagging

is applied to meet the thickness specifications. Autoclave vulcanization under

closely maintained and controlled conditions assure the best possible rubber to

steel adhesion bond

1.5.7 Sprayable Coatings

It is extremely resistant to moderate concentrations of both acid and

alkaline solutions. Chemical resistance to slurries and water solutions is excellent at

ambient temperatures.It provides the resistance to abrasion, impact and corrosion

in the mineral processing industries worldwide. Applications are continually

developing which reduce down time, improve productivity, save valuable capital

dollars, and reduce maintenance costs.

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PROJECT METHODOLOGY

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2.1 Objective of the study

The main objective of this study is to have a general idea about the

rubber products market in UAE, the latest technologies adopted in rubber industry

and to study about the major competitors in the market. It also aims at evaluating

the strength and weakness of marketing of rubber products in UAE and suggesting

ways to capture the market.

2.2 Scope and Significance of the Study

Scope of the study is conducted at rubber products market in UAE.

The study aims at analyzing the market of Rubber products in U.A.E. A random

analysis has been made on major marketers of rubber products in UAE, especially

industrial suppliers. An attempt has also been made to find out the customers

attitude / satisfactory level of customers towards the product and the suppliers.

2.3 Research Methodology

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The approach to this study is supply based. The trade sector and

manufacturing sector will be considered in this study. Basically the imports

constitute the supply side of the Rubber market while the domestic consumption

and re-exports constitutes the demand side of the market. In addition the data that

is available with the Chamber of Commerce databases and other countries

databases are used to shed light on the size and the structure of UAE Rubber

products market. Secondary data from other relevant sources has also been used.

Research methodology is considered as the nerve of the

project .Without a proper well organized research plan, it is impossible to complete

the project and reach to any conclusion. The project was based on the survey plan.

The main objective of the survey was to collect appropriate data, which work as

base for drawing conclusion and getting result. Therefore, Research methodology is

the way to systematically solve the problem. Research methodology not only deals

about the methods but also logic behind the methods used in the context of a

research study and it explains why a particular method has been used in the

preference of the other methods.

Research Design

Research design is important primarily because of the increased

complexity in the market as well as marketing approaches available to the

researchers .In fact it is key to the evolution of the successful marketing strategies

and programmes .It is an important tool to study the buyers behavior, consumption

pattern , brand loyalty and focus market changes . A research design specifies the

methods and procedures for concluding a particular study. Research design

specifies methods and procedures for study.

Sampling Methods

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Random Sampling Methods, The researcher had selected a reasonable

number of samples for the primary data collection. The technique selected for

sampling was convenience and availability. Type of sampling method used is

random in nature.

Sample Size

The sample size for the study limited to150 customers of rubber products

Research Tools

The tool used for analyzing the primary data collected through questionnaire

was percentage system. Diagrammatic presentation has also been done through

charts .Secondary data’s has been collected from annual reports of companies ,

text books and internet.

Research Area

A Macro level analysis has been made on rubber product market in UAE with

special reference to Nine major suppliers of rubber products in the region .

2.4 Limitations of the Study

Best effort has been made in preparation of this project as accurate as possible. However this study has some limitations.

The time factor played an important role in this study. Due to the shortage

of time, the project was not sufficient to study all the factors deeply

We cannot say that what the consumers have revealed will be right for

each and every situation because their perception may influenced by

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many factors. While collecting the data, most of the customers are

unwilling to reveal which company’s product they prefer.

Many consumers and dealers showed less interest in providing

information and was not cooperative with a view that this is a kind of time

waste.

Some of confidential information Viz Credit period, schemes, policies and

sales figures were not disclosed by competitors.

MARKETING ANALYSIS REPORT OF RUBBER PRODUCTS

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MARKET ANALYSIS OF RUBBER IN THE WORLD

3.1 World Rubber Consumption

World rubber consumption declined -3.6% in 2008, slightly more

than previously estimated because of the worse-than-expected performance in

Asia/Pacific .The outlook for 2009-2011 is also gloomier than the earlier forecasts,

i.e. -1.8% annually .Despite a weak performance, Asia/Pacific is the only region

expected to show a positive growth rate. NR performed better than SR last year and

possibly will continue to during 2009-2011.Despite a slowdown in demand, NR

output is expected to continue to increase leading to a further increase in global

stocks .Unlike NR, SR output is forecast to show a decline, but not enough to slow

down the increase in stocks. Despite an expected increase, NR stocks to

consumption ratio are still relatively low.  This coupled with a possible depreciation

in the US dollar may produce a further rise in NR prices.

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World rubber consumption in 2008 declined slightly more than

previously estimated at -3.6% from 23.51 million tonnes to 22.67 million tonnes. 

This was mainly due to the worse-than-expected performance in Asia/Pacific as the

world largest consuming country, China, shows a decline of -1.2% rather than an

increase of 0.6% as stated in our previous report. Global consumption of natural

rubber is expected to increase to 10.04 million tonnes this year if recessionary

conditions ease. The boom in the automobile sector across the globe, especially in

China and India, has augured well for rubber demand, he said, adding that climate

change and its impact on rubber production have emerged as a serious concern.

3.2 World Industrial Rubber Product Market

Global demand for industrial rubber products is forecast to climb

4.5 percent annually through 2013 to nearly $110 billion. Market advances in

developing areas will be fueled by healthy economic growth, ongoing

industrialization efforts and rising personal income levels, bolstering manufacturing

output and fixed investment expenditures. In addition, higher living standards will

help stimulate demand for automobiles and other industrial rubber product-

containing durables, boosting both original equipment (OEM) and

maintenance/repair/operations (MRO).

Mechanical rubber goods to benefit from rising motor vehicle production.

Mechanical rubber goods, which include body seals, vibration control products,

wiper blades and a variety of miscellaneous goods such as bellows, bumpers, duct

covers, mallets, pads, plates and trim, comprised the largest product segment in

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2008. Suppliers of mechanical rubber products will benefit from continued gains in

motor vehicle production through 2013, as these products are highly represented in

this market. Industrial equipment to remain largest application Industrial equipment

-- which includes industrial machinery and equipment as well as off-road vehicles --

will continue to comprise the largest end-use market in 2013. Demand in this market

will benefit from rising demand for heavy industrial equipment such as construction

and mining machinery. China, which recently surpassed the US to become the

largest national market for industrial rubber products, will account for over 40

percent of all additional demand through 2013. India will also record strong gains,

and sales growth is expected to be healthy as well in a number of lower-volume

markets, including Thailand and Indonesia. Advances will continue to be solid in

Eastern Europe, reflecting the ongoing shift of durable goods manufacturing to that

region, primarily from Western Europe.

Industrial rubber product demand in the US, Western Europe and

Japan will rise as well. Advances will be spurred by largely favorable economic

climates and higher per capita income, resulting in increased manufacturing activity

and consumer spending for durable goods. Although representing mature markets,

these areas -- along with Australia and Canada -- will remain the most intensive

users of industrial rubber product products because of the advanced industrial and

technological nature of their economies. The large numbers of industrial rubber

product-containing equipment in use will also help bolster aftermarket industrial

rubber product demand.

MARKETING ANALYSIS OF RUBBER PRODUCTS IN UAE

3.3 Rubber Market in UAE

Rubber imports and exports into Dubai have hit Dhs 7.8 billion in 2008,

according to recent reports, which is consistent with the trend of continuous growth

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in the demand for rubber products being seen across the globe. In line with this,

Rubber World Industries (RWI), the leading manufacturer of closed-cell rubber

insulation 'Gulf-O-flex' in the Gulf and South East Asia, and part of the international

business conglomerate, the Memon Group of Companies, has announced plans to

reinforce its current production capacity, amidst projections of a continuous rise in

global demand for rubber products by 4% annually to reach 26.5 million metric tons

by 2011. The move follows a previously announced Dhs 30 million expansion plan

outline focused on tripling its production capacity to 3,600 containers per year by

2013. At present, RWI accounts for 86% of the Middle East rubber insulation market

share, supplying the majority of the region's requirements for rubber insulation

pipes, sheets and other rubber-derived products.

In addition, the company's success is exemplified by its excellent

sales revenues, which peaked at over Dhs 10 million in 2007. The company's

success stems from the esteemed repute of its products, which have been identified

as the preferred brand in the region against top competitors from China, Germany

and the rest of the world. "Increasing the quantity and augmenting the quality of our

products are our foremost goals for 2009. We have strategically planned to elevate

our production, and we are optimistic that we will see further growth in the region,

especially in Dubai. Given the bullish projections on the demand for top quality

rubber and rubber insulation products in the emirate, we are fully committed to

continuously meeting the requirements of our valued customers," said Abu Baker

Shaikhani, managing director, Rubber World Industries, and chairman of the

Memon Group. As a major player in the construction industry, RWI has delivered

high quality products to major property developments by real estate leaders in the

UAE. Among its largest undertakings in the emirates include a residential project,

"The Villa" in "Dubai land," the "Motor City" project, a Dhs 418,000 contract for the

"Traders Hotel" project, and a half million dirham deal for the "Horizon Tower"

project. Furthermore, the company has also recently announced that it has been

awarded a contract to supply top quality rubber insulation products worth PHs

875,000 for the "Green Community West Villas and Apartments," a high profile

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themed community development by Union Properties (UP), located in Dubai

Investment Park. In addition, the company also delivers its products to more than 90

countries, including the U.S., Germany, Russia, Canada and Singapore. "For our

products to be a part of some of the most revered structures in Dubai and across

the globe is truly a remarkable feat, which further motivates us to drive our

association with the most prestigious projects by continuously providing them with

top quality rubber products. While increasing our production is very much our focus,

we are also allocating a considerable part of our resources to further enhance our

products' performance by utilizing the latest manufacturing technologies," concluded

Shaikhani. With modern plants located in the Ajman Industrial Area in the UAE, RWI

is the only producer of rubber insulation in the Middle East region that manufactures

a versatile range of rubber insulation products to meet the requirements in the oil

and gas fields, construction, shipping and automobile industries. Since its inception

in 1993, the company has delivered high quality products to major property

developments by real estate leaders in the UAE and across the globe.

3.4 Influence of Rubber Product in UAE Market

2007 2008 2009 2010 2011 2012 2013 2014Local

supply1.2 10.4 12.7 6.4 10.4 8.1 15 17.3

Import 3.4 9 8.1 15 9 7.6 11.8 13.2

Export 6 10.8 12 9.6 10.8 9.6 13.2 14.4

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3.5 Effect of Financial Crisis

The financial crisis had its impact on the rubber industrial sector of

UAE by the global economic slowdown with the decline beginning in late 2008. This

has resulted in a reduction in investor confidence, the tightening of liquidity and a

major slowdown across all rubber markets, with transactional activity grinding to a

halt and asset prices falling substantially from their 2008 peaks. Whilst this has

caused many investors and developers to suffer short-term financial losses, the

impact has been less dramatic than other regional markets. This was because the

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slowdown occurred after only a few years of growth since the opening up of the

rubber market (and therefore a limited overhang of supply) and because of investor

confidence in UAE longer term growth potential compared to other markets in the

region. The positive impact on the economic slowdown is that it forced developers

to re-assess their schemes, scale back more ambitious projects, seek more

sustainable means of funding projects (rather than off plan sales) and plan product

to be more aligned to the needs of the end user. Most projects have faced some

kind of delay as developers are experiencing cash flow issues. The vast majority of

announced projects for which construction has not commenced are being put on

hold until the market picks up.Even though many financial crisis have sprouted its

tentacles to squeeze the rubber sector, it arises like a phoenix bird and continuing

its victory in world market.

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LATEST TECHNOLOGIES IN RUBBER INDUSTRY

RUBBER TECHNOLOGY

Rubber technology is the subject dealing with the transformation of

rubbers or elastomers into useful products, such as automobile tires. The materials

includes latex, natural rubber, synthetic rubber and other polymeric materials, such

as thermoplastic elastomers. Most rubber products are vulcanized, a process which

involves heating with a small quantity of sulphur (or equivalent cross-linking agent

so as to stabilize the polymer chains, over a wide range of temperature. This

discovery was made by Charles Goodyear in the 1844, but is a process restricted to

polymer chains having a double-bond in the backbone. Such materials include

natural rubber and polybutadiene. The range of materials available is much wider

however, since all polymers become elastomeric above their glass transition

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temperature. However, the elastomeric state is unstable because chains can slip

past one another resulting in creep or stress relaxation under static or dynamic load

conditions. Chemical cross links add the stability to the network that is needed for

most practical applications.

4.1 Flexible Solutions in Rubber Industry

Most automobiles have

hundreds of rubber-based parts, and

automotive tires alone constitute the

majority of both synthetic and natural

rubber consumption. Rubber is a highly

effective material for tire production

because it is elastic, air-tight, wear

resistant, water resistant, and able to

absorb a relatively large degree of

shock. These characteristics also make rubber useful for manufacturing sealers,

insulators, hoses, tubes, gloves, and many other products. Like most industries,

rubber manufacturing is not a static business, but is often developing new methods,

products, and technologies to meet changing consumer needs. Whether evaluating

and redesigning economic practices, developing new methods of rubber processing

and fabrication, or addressing environmental concerns, rubber manufacturers are

reacting to changing circumstances in anticipation of marketplace demands.

4.1.1 Economic Restructuring

Raw material prices in the synthetic rubber industry tend to climb when

oil prices are high. Since the U.S. relies heavily on synthetic rubber, American

manufacturers may be subject to increasing expenses due to higher energy costs,

particularly in the tire industry. Similarly, raw natural rubber may become more

expensive due to changing environmental conditions or from a shortage of synthetic

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rubber supplies. When coupled with a general slowdown in consumer demand or

production rates, these factors can cause dropping stock prices and mounting debt.

During periods of uncertainty in the rubber market, many companies

develop strategies to stimulate growth, expansion, or to preserve their market

share. Some common practices used by manufacturers involved in the rubber

business include. Shifting focus to international trade: With emerging markets in

Asia and Latin America, some major companies attempt to offset domestic losses

by staking capital on foreign investments. These investments can be used to

modernize and expand existing plants abroad, or to increase production rates in

regions where demand for rubber products continues to grow. Much of the current

growth is driven by expanding automotive industries in countries like China and

India, and several tire manufacturers have responded to this increasing

consumption by developing operations in international markets. Corporate

restructuring: Some companies see beneficial results from streamlining or scaling

back their operations. Reorganizing the business model may involve workforce

reductions, changes in management, or the elimination of non-essential practices.

These measures are intended to offset costs and improve a company’s open

market valuation by maximizing its revenue. Changing production methods or

materials: If a particular type of raw rubber material has become prohibitively

expensive to process, it may be useful to shift resources toward a different type of

rubber that is more cost-effective to obtain. Also, reducing travel time for

components between manufacturing stages and introducing dedicated assembly-

specific cells into a machining operation can increase production efficiency.

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4.1.2 Product Innovations

Economic restructuring is not the only method for remaining competitive

in the rubber industry. While it may seem counterintuitive to direct money toward

research and development during financially challenging times, a new rubber

product or processing technique can revitalize a manufacturer’s business. Although

revolutionary advances like vulcanization or the development of synthetic rubber

technology are relatively rare, more modest innovations can still be a significant

source of income and market share. For example, some biological growths target

rubber gaskets, seals, and stoppers. These corrosive elements can severely

undermine the integrity of certain machines and goods, particularly in the food

industry. To address this concern, researchers developed an anti-microbial rubber

coating product to reduce and regulate the growth of bacteria in processing

equipment. This new rubber is thermally stable, migration resistant, non-toxic, and

requires no special handling skills. The cost of developing such innovations can be

offset by the income generated from a wide range of applications in products like

wheels, O-rings, bladders, packaging, tubing, liners, and conveyor belts.

4.1.3 Processing Innovations

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In addition to creating new products, research and development can

lead to innovative processes for deriving rubber stock. Since energy prices or

ecological changes can negatively affect the rubber industry, some scientists and

engineers have experimented with alternative methods for synthesizing rubber. For

example, researchers have found that a type of elastic protein found in insect legs

has potential for industrial rubber fabrication. This substance, known as “Resilin,” is

an elastomeric compound with properties remarkably similar to those of synthetic

rubber, and may have long-term industrial applications as a form of rubber stock

derived independently of oil or plant sources.

4.1.4 Environmental Awareness

As environmental issues increasingly influence consumer demand,

some manufacturers have developed more eco-friendly technologies to meet

changing market needs. The desire for more efficient fuel economy and reduced

environmental impact from automobiles has led several companies to introduce

“green” tires. These tires use specially designed materials, such as silica-treated

rubber, to improve wheel traction and tread resilience, reduce fuel usage by as

much as 5 percent, and lower carbon dioxide emissions. While there are certain

downsides to the new technology (such as higher manufacturing costs), the

reduction in fuel consumption and pollution can generate greater consumer demand

for rubber products. Recycling rubber goods is another environmental concern that

can affect manufacturing industries. Vulcanized rubber has traditionally been very

difficult to recycle, and often ends up in landfills or incineration plants. To combat

this problem, some companies employ de-vulcanization techniques that break apart

the cross-linked sulfur bonds in vulcanized material. This allows recycled rubber to

be mixed into virgin rubber compounds or reused as raw stock. De-vulcanization

can recover almost a third of the rubber in a discarded tire, reducing the need for

purchasing new material and providing an environmentally friendly disposal method

for manufacturers. Flexible solutions such as this can provide advantages for

companies competing in the rubber market.

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4.2 Technologies In Rubber Industry

For 50 years, ERIKS has been a leading company in the field of rubber

technology. This covers a wide range of industries with different products going

from rubber mouldings over inflatable seals to high purity rubber parts.

4.2.1 Custom Made Moulding

The molding of rubber and elastomeric compounds is accomplished by

forcing the material into a shape using heat and pressure. Rubber and elastomers

can be molded by compression, transfer and injection methods. The volume of parts

and type of compound required will determine the molding method used.

4.2.2 Inflatable Seals

The most effective technique for sealing between surfaces which move

in relation to one another is the CEFIL'AIR® pneumatic seal. CEFIL'AIR® seals

expand and retract to provide a secure, reliable seal that can hold, position, or

handle objects in a wide range of applications. As a result of its patented design,

modern manufacturing techniques, and the most advanced elastomers,

26

CEFIL'AIR® seals can be used in a multitude of sealing, handling and holding

applications. CEFIL'AIR® seals withstand temperatures from -148°F (-100°C) to

+482°F (+250°C) and pressures from 7 to 150 psi (0.5 to 14.4 bar) in a variety of

liquid or gaseous media. 

Over 200 different sizes and executions are available for general low

cost applications

Technical mounts

A complete range which provides a technical solution for reducing noise and

vibration transmission and providing shock protection.

27

Leveling mounts

A machine mounting like for instance Nivofix, is an adjustable equipment foot

comprising a circulardisc bonded to a protected elastomer base.An adjustment

screw is fitted into the assembly.The elastomer base has anti-slip ridges.

Antivibration plates

Low-cost plates, offering a good protection and decreasing the noise level in

workshops.

Flexible bushes

A flexible bush has an elastomeric element enclosed between an outer sleeve

and a centre axis intended to replace a greased bush.

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4.2.3 Bellows

The bellow line consists of many configurations and is produced

primarily from Neoprene® (polychloroprene CR). Neoprene offers good oil and

heat-aging resistance. These bellows are used to protect cylinders and other

machine elements against dust, water, and other chemicals. ERIKS has developed

an on-line bellows selector to assist users in the selection of the proper bellows

configuration. The user inputs diameter and overall length of the bellows, or can

input the appropriate V6 part number.

4.2.4 Coated Rubber Parts

Rubber parts tend to stick to each other or to metal parts, causing

problems while assembling or causing stick-slip when starting up the application. To

29

avoid both problems, there is RX® SurfaPlus! The most important advantages are

the following:

1. Reducing friction, up to 70% (depending on the type of coating)

2. Longer life

3. No stick-slip

4. No sticking of parts

5. Less force acquired for assembling

6. Stretch up to 150% possible without damaging the coating

7. Applicable on all types of rubber

8. FDA-approved

9. Many colours possible

4.3 Innovation of Thermoplastic Elastomers

Advanced production technology is spearheading the development of

new types of thermoplastic elastomers (TPEs), tipped as one of the growth

30

polymers for the next few years. Two major producers, Advanced Elastomer

Systems (AES) and DSM Elastomers have recently launched new series of TPEs,

using innovative polymerization technology to expand the properties 'envelope', in

the direction, particularly, of improved temperature resistance at top and bottom

levels and better long-term resistance to UV radiation.

4.3.1Santoprene™ thermoplastic vulcanizate (TPV)

Santoprene™ thermoplastic vulcanizates (TPVs) are high-performance

elastomers that combine the best attributes of vulcanized rubber – such as flexibility

and low compression set – with the processing ease of thermoplastics. In consumer

and industrial product applications, the combination of Santoprene TPV properties

and ease of processing delivers improved performance, consistent quality and lower

production costs. In automotive applications, the lighter weight of Santoprene TPVs

contributes to improved efficiency, fuel economy and reduced costs. They also offer

numerous benefits in appliance, electrical, construction, healthcare, and packaging

applications. On standard thermoplastics equipment, Santoprene TPVs can be

injection molded, extruded, blow molded or thermoformed, and clean scrap from

these operations can be reused. Santoprene TPV is recyclable in the polyolefin

recycle stream.

4.3.2 Santoprene TPV advantages

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Harsh-environment performance

Parts made from Santoprene TPVs offer a constant service temperature

range from -60°C to 135°C (-81°F to 275°F) with no cracking or tackiness. Excellent

heat aging combines with good resistance to many acids, bases and aqueous

solutions.

Portfolio of bonding grades

Select from more than 20 grades that bond with ETPs, nylons, metals and

various polyolefins. Overmolds as thin as 0.5 mm eliminate adhesives, bonding

agents and mechanical interlocks. Save costs through parts consolidation and

design flexibility.

Soft-touch aesthetics

The dry silky feel of grips, knobs and handles made with Santoprene TPVs

adds customer appeal and cost-effective market value to consumer and industrial

products.

Broad range of flexibility

Santoprene TPVs range from supply 35 Shore A to tough 50 Shore D.

General purpose grades is suitable for most applications. FDA-compliant, NSF-

listed and medical grades are also available. Flame-retardant grades meet UL

requirements.

Easier design for complex parts

Design tolerances can be two to three times more precise than with EPDM or

polychloroprene rubber. This enables product designers to create parts with thick or

thin walls and to simplify multipart designs.

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4.4 DSM Elastomers

DSM Elastomers is a global supplier of EPDM rubber (Keltan) and TPVs

(Sarlink®), with a strong presence on all continents. Through our global sales

organization and distribution network we provide an extensive range of high quality

grades to converters and compounders around the world. Our position as a

dynamic and leading player in the market enables us to secure a constant supply of

highly consistent materials. Moreover, our sophisticated logistics handling ensures

hassle-free delivery anywhere in the world.

DSM Elastomers, world leader in EPDM, has announced its effective on

September 15, 1999, the portion of its business specific to both EPDM and specialty

petroleum additives in North and South America, will be identified as DSM

Elastomers Americas. Until then the companies responsible for these activitites

were identified as DSM Copolymer and DSM Elastômeros Brasil. DSM Elastomers’

SBR manufacturing facility, located in Baton Rouge, Louisiana, will continue to

business worldwide under the name DSM Copolymer.

4.4.1 Plant modernization

DSM Elastomers Americas is preparing for a major plant modernization of its

Addis, Louisiana, EPDM production facilities. A turn-around completed during

August this year marked the start of a four (4) year, multi-million dollar project

named ‘Horizon 20/20’. The first objective is to modernize the three existing rubber

production lines to enable cost effective operations through the year 2020.

Furthermore a major capacity expansion programme, also for petroleum additives,

is under study.

4.4.2 TPV range of DSM Thermoplastic Elastomers

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DSM Thermoplastic Elastomers - a business unit of DSM Elastomers the

world's leading supplier of EPDM rubber - will introduce a new, innovative range of

its Sarlink® thermoplastic vulcanizates, the Sarlink 5000 series, shortly. Sarlink

5000's unique combination of high elastic performance with high UV/color stability

makes that this material has an excellent position versus other materials. Sarlink

5000 is excellently suited to meet the specifications of major automotive

interior/exterior and building & construction applications. Sarlink 5000 has

successfully been test marketed at selected accounts around the world.

Unique features

Anticipating future needs in auto sealing systems and building &

construction applications, DSM aligned its broad resources base (raw materials like

Keltan® EPDM and Stamylan® polypropylene, research and industry know-how) to

develop a next generation Sarlink product with improved properties .Besides it was

DSM Thermoplastic Elastomers' aim to have its new product exceed the

specifications of major automotive exterior/interior and building & construction

applications, thus setting new industry standards.

Market dynamics

Sarlink 5000 is an innovative material with the development of which DSM

Thermoplastic Elastomers has anticipated a number of market dynamics in auto

sealing systems and building & construction. Based on discussions with industry

representatives all over the globe the company thinks that the impact of these

dynamics will increase in the short term. To be mentioned are.

Auto Sealing Systems

Environment:

Push for 'green' solutions without losing functionality: EPDM and PVC

replacement by TPVs (weight, recyclability halogen free)

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Styling:

Push for body- and interior material matching: switch from black to coloured

materials matched to or in harmony with body and interior colours

Functionality:

Move from materials based specs towards functionality of systems.

Building & construction:

Increased use of TPVs in wooden, PVC and aluminum frames due to:

Demand for colored gaskets with high UV stability requirements;

Better elastic properties for high demanding seals compared to PVC;

Weldability compared to thermo set rubbers.

4.5 VICONE High Performance Rubber

Vicone specialize exclusively in customized and re-engineered rubber

extrusions, molded and fabricated rubber parts. It helps to implement continuous

improvement and cost reduction strategies and ensure specific needs of customer.

Extruded Glazing Spacer

35

A method and apparatus for extruding a plastic spacer directly on an object,

in particular on the periphery of window glazing, such as automobile glazing

intended to be glued into the opening of a vehicle. In particular the invention relates

to properly producing the connection zone between the end and the beginning of

the extruded spacer when it forms a closed loop. According to the invention the

beginning of the spacer and the remainder of the loop are extruded, with the

exception of the connection zone. The object is then provided with an applied anti-

adhesive deposit surface that is continuous with the surface of the object. The path

of the extrusion head is diverted in relation to the surface of the object so that the

extrusion occurs on the applied deposit surface, proximate to and beyond the

beginning of the spacer loop. The extruded spacer is then allowed to harden and

the extremities of the spacer are cut and adjusted to properly complete the

connection. After extrusion, the applied deposit surface may be eliminated or

neutralized and the spacer, whose path was diverted on the surface of the object, is

glued in position to complete the connection zone.

Molded Seal

36

Silicone is one of the most versatile “rubber" compounds. With its extreme

temperature range (-80°F to 550°F), it exceeds all comparable materials in their

insulating properties as well as flexibility in a wide range of electrical applications. It

is non-conductive, maintains dielectric strength, and can be color matched to any

Pantone/RAL. Silicone also has high tear and tensile strength, good elongation,

great flexibility and a Durometer range of 20 to 90 Shore A. Silicone rubber resists

the deteriorating effects of sunlight, ozone, and gasses which cause weathering.

Inherently water repellent (hydrophobic), silicone is not affected by moist operating

conditions. Very dry conditions and low humidity will not leach, dry out, or affect

silicone in any way. Silicone also resists the deteriorating effects of the agents

found in rain water: nitrates, sulfates, chloride, and hydrogen ions. Surface water

containing minerals, acids, bases, and salts from the soil normally have no

detrimental effect on silicone. Silicones should not be used with concentrated

acids, alkaline or solvents.

Fabricated Gasket

37

An improved gasket for use with manhole covers. The gasket is of the type

which is fabricated from rubber and is held in a circular groove formed in the flat

cover support surface of a cast iron frame of the type which holes a manhole cover.

The manhole cover fits in the frame and rests on the gasket. The improved gasket

has a vertical portion which is generally rectangular which fits into the circular

groove. The gasket also has a horizontal portion which extends beyond the groove

and onto the flat cover support surface of the frame.

4.6 Cellular Rubber

Rubber products which contain cells or small hollow receptacles are

named as cellular rubber products. The cells may either be open or interconnecting

or closed and not interconnecting. This specification establishes requirements for

chemically blown cellular rubber. Cellular rubber may be classified into two types:

Type I which is open cell or sponge rubber and Type II which is closed cell or

expanded rubber. Both types are divided into three grades: Grade A which is oil-and

flame-resistant, Grade B which has no requirements for oil , flame resistance, or low

temperature, and Grade C which is low-temperature resistant. Each type and class

38

has been divided into three different conditions. Each condition is based on a

specific range of firmness as expressed by compression deflection as follows: super

soft, soft, soft-medium, medium, medium-firm, and firm conditions. Several tests

shall be performed in order to determine the following physical properties of cellular

rubber: compression deflection, low-temperature resistance, accelerated aging,

recovery, flame resistance, shrinkage, water absorption, oil aging, and color. A

method for making a cellular rubber is described, in which water is added to a high

water absorption resin, followed by allowing the resulting mixture to stand and form

a hydrous gel. The hydrous gel, with or without a foaming agent, is added to a

rubber compound and subjected to foaming under conditions sufficient for

vulcanization thereby obtaining a cellular rubber having a closed cell structure. A

cellular rubber body protection material having an inner layer of porous expanded

PTFE. It is used for making seals, cellular cosmetic puffs, a wet suit or orthopedic

brace, offering improved wearing comfort and reducing allergenic reactions in

comparison to conventional cellular rubber body protection materials. Rubber

compounds based on Neoprene, oil extended EPDM and a fluorosilicone/silicone

blend were developed for use in the molding of cellular materials that have a limited

amount of cell structure. The high-bulk modulus cellular materials had lower tensile

strength, elongation, hardness, and modulus than the solid controls, as was

expected. Several of the EPDM-based cellular materials had reasonably high

strength. The age resistance of the materials is also better.So it is used for military

applications such as weapons,buffers,springs,vibration isolators and many other

army equipments. It is also used for the manufacture of tire having tread with an

internal closed cellular rubber transition layer.

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4.7 Silicone Rubber

40

Silicone rubber is a rubber-like material composed of silicone — itself a

polymer — containing silicon together with carbon, hydrogen, and oxygen. During

manufacture heat is required to vulcanize (set or cure) the silicone into its rubber-

like form. This is normally carried out in a two stage process at the point of

manufacture into the desired shape, and then in a prolonged post-cure process. It

can also be injection molded. Silicone rubber is an inorganic synthetic elastomer

made from a crosslinked silicon-based polymer reinforced with filler. It offers a

unique combination of chemical and mechanical properties organic elastomers

cannot match. A silicone rubber is prepared from a silicone rubber compound

comprising (A) an organopolysiloxane having an average degree of polymerization

of at least 100, (B) a reinforcing silica filler, and (C) an organohydrogenpolysiloxane

by mixing component (C) with components (A) and (B) and heating them at a

temperature of at least 100° C. to form the silicone rubber compound, adding an

organic peroxide or a platinum group metal catalyst to the compound, and

crosslinking the compound. The silicone rubber exhibits a minimal difference in

physical properties between primary vulcanization and secondary vulcanization.

Silicone rubber is generally non-reactive, stable, and resistant to extreme

environments and temperatures from -55°C to +300°C while still maintaining its

useful properties. Due to these properties and its ease of manufacturing and

shaping, silicone rubber can be found in a wide variety of products, including:

automotive applications; cooking, baking, and food storage products; apparel such

as undergarments, sportswear, and footwear; electronics; medical devices and

implants; and in home repair and hardware.

The below properties make silicone rubber the material of choice for

applications ranging from bake ware to turbocharger hoses. They are

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Longer service life in adverse environments

Virtually unaffected by weather – rain, snow, humidity, ozone, or the

sun’s damaging ultraviolet (UV) rays – for many years

Enhances the comfort and feel of consumer goods

Excellent sealing performance

Inert (no taste or smell); many food-contact options

More choices – a wide hardness range (from 10 to 80 Shore A), a

wide range of color choices (from transparent to brightly colored)

Better flow properties – easier to fabricate, increases productivity

More fabricating options, increased productivity

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Advantages

Silicone rubber has the best release properties of all the mold rubbers,

which is especially an advantage when doing production casting of resins

(polyurethanes, polyesters and epoxy). No release agent is required, so there is no

post-production cleanup. Silicones also exhibit very good chemical resistance and

high temperature resistance (400°F / 205°C and higher). High temperature

resistance makes silicone the only mold rubber suitable for casting low melt metal

alloys (i.e. tin, pewter, lead). The combination of good release properties, chemical

resistance and heat resistance makes silicone the best choice for production

casting of resins.  

Disadvantages

Silicones are generally high in cost – especially platinum-cure. They are also

sensitive to substances (sulfur clay for example) that may prevent the silicone from

curing (referred to as cure inhibition). Silicones are usually very thick (high

viscosity), and must be vacuum degassed prior to pouring to minimize bubble

entrapment. If making a brush-on rubber mold, the time factor between coats is

long (longer than urethanes or polysulfide’s, shorter than latex). Silicone

components (A+B) must be mixed accurately by weight (scale required) or they will

not work. Tin catalyst silicones will shrink somewhat and do not have a long library

life. The above described ones are some of the major rubber technologies. As more

and more novelty ideas cracks in the rubber product manufacturing industry, many

technologies open their doors towards the wide sector.

43

MAJOR COMPETITORS OF RUBBER MARKET IN UAE

5.1 MAJOR COMPETITORS OF RUBBER MARKET IN UAE

44

Profile of some of the major rubber product suppliers are briefed as under.

5.1 () HAMBURG TRADING CO.LLC

HAMBURG TRADING CO.LLC, Innovations in polymers materials and

applied technology have brought about a dramatic change in industrial activity as

well as everyday life. HAMBURG Trading Co.LLC has played a pioneering role in

bringing the latest products and technologies in this field from India and neighboring

countries and has established itself as the one of the largest distributors for world

class EPDM Sealing Products in the Middle East. It manufactures more than 3000

different types of EPDM Rubber profiles and caters to the sealing requirements of

various Industries including Automobiles, Railways, Ships, Ocean going containers

& Buildings etc. With technical know-how from Korea & Germany and Japan our

associates in India bring variety of Architectural and Building Profiles to meet the

ever-changing demands of the global Building construction Industry taking care of

the varied weather conditions prevailing in this region.HAMBURG Trading Co.LLC

(previously known as Murtaza Baqer Mohebi Est.), situated in Dubai is 15 years old

company which imports and distributes EPDM Rubber profiles and various other

architectural accessories catering to the sealing requirements of the following

industries

1. Automobiles

2. Ships

3. Electrical Panel

4. Water Tanks

5. Manhole covers

6. Refrigerated Trucks & Ocean-going containers

7. Aluminum Extrusion systems

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8. Various other Industrial Sealing applications

The products comply with most advanced International standards. HAMBURG

Trading Co.LLC is one of the largest suppliers to nearly 60% of the Architectural

Industry for Rubber in UAE. The company’s products conform to (ISI) and

International standards such as JASO, ASTM, DIN and BS. HAMBURG responds to

the demands of Building Construction Industry with ongoing Research and

Development by its associates from every functional angle. HAMBURG is supplying

EPDM Architectural/Building Profiles to many International systems and indirectly

catering to most of the Building Construction sites/Project sites in the world.Their

products ranging from wind shield rubbers, Co-extruded profiles / trims, Glazing

rubbers, Cellular profiles with nylon clips. A complete range tapes which includes

surface protection tapes, guard films, structural glazing tapes, spacer tapes etc.

Insulation materials like plastic anchors, plastic screw anchors, wall plastic anchors

are their other products.

46

5.1 () ARAB EMIRATES BANDAG CO.LLC

Arab Emirates Bandag Co. LLC. is a proud member of Galadari

Brothers Group of Company, a leading business house of UAE is a name to reckon

with when Rubber Products is spoken of in this part of the world. A name that has

given soul to various rubber products used here and elsewhere.

The company that has made a mark in UAE and GCC Countries with its

singular vision of developing rubber products for various industries ranging from

Chemical, Transportation, Oil & Gas, Material Handling, Construction, Packaging

and Shipping. The company is engaged in following activities

1. Retreading of Tires

2. Rubber Moulded products

3. Rubber Extruded products

4. Cast Polyurethane products

5. Anticorrosive & Anti abrasive Rubber Lining

6. PU & PVC Conveyor Beltings

7. Transmission Flat Belts

8. Thermo Wieldable Extruded Belts, Profiles & Buckets

9. Rubber Conveyor Beltings, Conveyor Rollers, Frames & Splicing Services

10.Rema Tip Top Corrosion Protection, Wear Protection & Conveyor Belt

Maintenance

11.Rema Tip Top Automotive Repair Materials & Equipments

47

AEB is well equipped with compounding facilities to meet wide and

demanding requirements. The rubber compound is prepared from data bank of

formulations depending upon the functional requirements of the product. Products

are made of Natural Rubber, Synthetic Rubbers like Neoprene, Nitrile, EPDM, Butyl,

and Polyurethane

Retreading of Tyres

AEB ventured in to procured tyre Retreading in Emirates in 1973. Major fleet

owners in UAE have recognized AEB’s expertise in cold cure process of Retreading

backed by total after sale service and guarantee. AEB Retread guarantees new tire

mileage when used in comparable conditions.

Rubber Moulded & Extruded Products

The vision of the company was to position itself as a manufacturer and supplier

range of industrial rubber products primarily to UAE’s fledging oil & non oil sectors

and overseas to meet its exacting demands and to use its experience to further

consolidate its position.Investigation showed that material handling, transportation,

chemical industries were growing at a higher rate locally and globally. This led to

AEB diversifying into rubber moulding, extrusion and anti abrasive rubber lining,

conveyor belting, rollers, frames, special services etc. An ISO 9001-2000 company,

AEB is well equipped to manufacture various types of intricate molded, extruded &

lined articles. These articles are produced based on compounds designed by

experienced in house compounders on sophisticated rubber mixing mill and electro

48

hydraulic presses & extruders to suit various application. Polyurethane articles are

produced using latest technology casting method.

Anticorrosive / Anti abrasive Rubber Linings

Anticorrosive and anti abrasive lining is one of the core

activity AEB has wide experience in offering lining to

seawater storage tanks, acid and alkali storage tanks,

piping, scrubbers, media filters, etc. AEB has carried

extensive work in offering anti abrasive lining to chutes; pump casing, impeller and

mining equipments. AEB have carried out the stripping of the defective lining and

providing new rubber lining in large diameter pipes and elbows connected with

seawater inlet and outlet of surface condenser for steam turbine for Dubai Electricity

& Water Authority and also successfully carried out the internal rubber lining of Mild

Steel Phosphoric Acid Storage Tanks Size: 16 mtr x 11 mtr. height. AEB works in

tandem with Rema Tip Top International a world leader in anti corrosive and anti

abrasive linings. It enjoys special technical support in design and execution of major

lining jobs. AEB is the sole distributors for Tip Top International products since over

2 decades. AEB has expertise in rubber lining by hot and cold process based on

soft or hard (ebonite) lining. Lining at our factory or site is carried with ease by our

experienced technicians

Rubber Conveyor Beltings, Rollers, Frames (Heavy Duty)

Supply of Rubber Conveyor Beltings for the use in Crushers, Cement Plants, Food

and other service industries is another activity of the company. Belts are supplied in

different plies and widths of Polyester, Nylon construction either in open length or

Endless as per customer’s requirement. Cold splicing of Rubber Conveyor Belt by

use of Tip Top method & material is the specialty of A.E.B.

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 Light Duty Conveyor Belts (PVC/PU)

AEB has been supplying light duty (PU/PVC) belts since

1996 for various application in UAE and Sultanate of

Oman covering industries like Packaging, Printing, Food

Products viz. chocolates, bakery products, fisheries,

dairies, mosaic ceramics & marble industries, frozen food, airport applications etc.

AEB is the registered authorized distributor of M/s Esbelt representing them in UAE,

Bahrain, Saudi Arabia, Yemen, Oman & Qatar. AEB today has a full fledged

workshop with splicing equipments, finger cutter etc. and a team of trained and

experienced technicians to carry out splicing in our factory or at site on a short

notice. AEB also maintains stock of various belts to cater the needs of local

demand.

Marketing Tip Top Tire /Conveyor Belt Repair Materials & Equipments

AEB is the sole distributors in U.A.E for M/s Rema Tip Top International, Germany.

AEB represent RTT for their complete range of products in the automotive/industrial

sector. In addition to stocking and selling RTT products, AEB also provide other

support services such as, assistance in setting up in-house tire repair shops,

50

comprehensive training etc. etc. As such AEB products are guaranteed for quality

and it is for this reason that AEB have built up a very strong customer base in UAE

and overseas

.

Polyurethane Products

AEB is one of the up-coming companies in the field of casted polyurethane products

such as wheels, profiles, strips, rollers, bumpers, bushings etc. AEB has well

trained technicians for carrying out the job and enjoys full technical support from

M/s Baule, France.

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5.1 () INTERNATIONAL RUBBER COMPANY LLC

International Rubber Company LLC (IRC) is one of the major rubber

product manufacturers in UAE. This is clearly evident from the location of our

factory, the state of the art machinery acquired from among the best in the world,

the production line up, the type of raw material being used, the professional team

are the main elements for its success Today IRC is perhaps the only company of its

kind in the Middle East that can manufacture industrial profiles that compete the

finest from Europe and America in terms of quality and range. Rubber compounding

is done by highly experienced and qualified Rubber Technologist using the most

sophisticated facilities. Compound supplies are sourced from the same suppliers to

major European rubber industries thus bringing the same level of standard to our

products. Our range of products are engineered to meet the tough environmental

and operational conditions of the Middle East. This ultra modern plant is equipped

with the most up to date microwave technology for continuous vulcanization of

Ethylene-Propylene Dyne Ethylene [EPDM] rubber profiles, the most efficient, clean

and environmental friendly method developed so far. EPDM rubber vulcanizates

have excellent resistance to weathering and ozone attack, very good aging, low

temperature flexibility, low electrical and thermal conductivity, therefore resulting in

perfect sealing, easier fitment, tight hold and long life. Emirates Tower, Dubai,

Media City, Internet City, Burj 2000, Al Darwish Tower were some of the major

projects undertaken by them.

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5.1 (V) RUBTECH-HIRA INDUSTRIES

Ramesh Hira L.L.C - HVAC Supplies for the Middle-East

Ramesh Hira LLC, was founded in 1980 in United Arab Emirates by

Mr.Ramesh Hira, an enterprising HVAC engineer from India. Ramesh Hira LLC, is

an HVAC distributor in the Middle-East based out of the United Arab Emirates, the

trading hub of the gulf. Since the foundation, the company has been focused on

serving all commercial, residential and industrial projects in the Middle-East & Africa

thru established MEP contractors that implement the jobs. With the 25 plus years of

experience on coverage of areas such as Qatar, Oman, Bahrain, Saudi, Egypt,

Kuwait, Jordan, Kenya the company has established a strong and loyal distribution

network and customer base. They mainly concentrate on the Manufacture of

Rubber Molded and Extruded Products in EPDM, Natural Rubber, Neoprene,

adhesive tapes, rubber speed humps, pipe supports, ducting accessories.

Hira Industries L.L.C - Manufacturer of Rubber Moulded & Extruded Products

Formed in 2002, this fully automated rubber plantation has the capability to

produce all types of rubber products. With a well experienced production and sales

staff, the company has substituted many imported products to its local manufacturing

53

plant. Rubber products are also exported from its factory to all over the world. Hira,

specializes in the production of rubber moulded and extruded products. In its range

are the impact protection products, such as corner guards and wall guards which are

used in the car parking area, neoprene rubber pads, EPDM profiles, speed humps,

rubber fenders and many more widely used products for various applications.

Hira Adhesive Tapes Division (Hira ATD)

The company has been active in the trading and value addition of

adhesive tapes since 1985. A newly acquired coating plant will now, enable the

company to coat many specialty adhesive tapes for the Middle-East, Africa and

European markets all in its new Al Quoz factory. The company focuses on the

production of Aluminium tapes, Reinforced Aluminium Tapes, Single and Double

Sided Foam tapes, Surface protection tapes and many other specialty tapes. Each

production batch is carefully checked for adhesion, elongation and various other

quality properties through its in house quality laboratory. Quality being a top priority

the company is accredited with ISO 9001 by KPMG.

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5.1(V) OCEAN RUBBER FACTORY LLC

Ocean Rubber Factory LLC has over the years developed expertise to

manufacture rubber components for the most demanding applications. It is the best

equipped and manned rubber factory in the United Arab Emirates and services the

oil & gas, marine and industrial companies worldwide. The company is located in

the industrial hub of Sharjah. With design, manufacture and test facilities backed up

by a dedicated quality control department and ISO 9001:2000 accreditation, we can

offer complete solutions related to rubber and elastomeric products and services in

fields such as fender system for ships, ports and offshore platform, shock pads for

drilling rigs, polychloroprene coating for risers, rubber lining for taps and pipelines.

Rubber Processing

Different grades and types of rubbers, both synthetic and natural are

processed in an Internal Mixer with the required quality tested ingredients. Mixing is

done under controlled conditions and parameters to ensure homogeneity and

quality of rubber compounds such as Natural Rubber, Polychloroprene (Neoprene)

Rubber, EPDM Rubber, Butyl Rubber, Styrene Butadiene Rubber, Nitrile Rubber,

Viton and Millable Polyurethane

Products

Injection and Compression moulding departments manufacture products such

as Bearing Pads and Expansion Joints for Bridges and earth-quake resistant

buildings, Track Pads for armoured vehicles, Pipe Seals for Sewage and other

media, Fender systems for ports and jetties. The Extrusions department produces

various types of profiles; Lining department undertakes external coating of Riser

Pipes and internal lining of Vessels, Tanks & Pipes, etc. Polyurethane department

produces technically advanced products using thermoplastics/thermosets

55

Elastomeric Sheets

Rubber sheets are used in variety of applications. They are used as simple

doormats to cases where the sheets have to withstand highly corrosive and harsh

environment such as splash zone in offshore application.

 

 

Ocean Rubber Factory L.L.C, manufacture different types of sheets as per specific

requirements. The elastomer used in manufacture undergo different test in our

laboratory to ensure chemical combinations and physical properties complying with

the specification as per the quality system accredited to ISO 9002 standards.

Rubber Lining

Ocean Rubber Factory L.L.C, with its

lining unit situated at the industrial area of

Sharjah, has had more than a decade of

experience in rubber lining involving many of

the prestigious power, oil & gas and industrial

projects within UAE and other countries in

Middle East. Ocean Rubber Factory LLC

located in the industrial area of Sharjah, U.A.E. was established in year 1989. The

factory produces various types of technical rubber products used in Oil & Gas

industry, Marine, Industrial, Defence and Construction Industry and has supplied its

products not only in the U.A.E. but also to other countries in the Middle East, USA

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and Europe.

5.1 (V) AL DOBOWI TYRE CO LLC

The Al Dobowi Group was formed in 1976 to address the needs of a

growing tyre management and service industry in the Middle East. Today they have

grown to become a leading global player in the industry providing clients with

superior services and unique solutions to their problems across three continents.

They have grown beyond tyre management into providing our clients with all

the solutions they need with regards to motion. This includes batteries for motive

power, lubricants, conveyor belt systems and technical rubber products. The Al

Dobowi Group is associated with some of the world's leading companies such as

Bandag, Baxenden , Caltex , Ceat Tyres, General Tires OTR,EPPCO. Al Dobowi

provides a wide range of products and unique solutions to their problems across

three continents.They manufacture products on anti corrosion

system,tyres,technical rubber products,industrial roller re-rubberization

system,elastomeric bearing and elastomeric joining system.

5.1 (V) WABO ELASTODEC E

The company is fully supported by qualified well trained staff dedicated

to sever BASF’s customer in the best way by providing high quality products, strong

technical service and support to create something crucial, important indispensable

to be the best in the area. BASF Construction Chemicals serves the local market

Jordan in addition to other Near East Territories in Syria , Lebanon , Iraq , West

Bank and Gaza . WABO ELASTODECE bearings are manufactured making use of

materials complying with all regulations in force, in simple layers of rubber or with

several layers separated by thin sheet metal. In reinforced bearings, vulcanized

rubber sheets are used to protect the steel from corrosion and to convey horizontal

forces from rubber to sheet metal. Their main manufacturing items include rubber

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impact protection system, water

5.1(V) GOOD YEAR MIDDLE EAST FZC

The Goodyear Tire & Rubber Company in 1898 seems especially

remarkable, for the beginning was anything but auspicious. The rubber and cotton

that were the lifeblood of the industry had to be transported from halfway around the

world. Goodyear is one of the world's largest tire companies, with operations in

most regions of the world. Together with its subsidiaries and joint ventures,

Goodyear develops, markets and sells tires for most applications. Goodyear

operates more than 57 plants in 23 countries. Our principal business is the

development, manufacture, distribution and sale of tires and related products and

services worldwide. We manufacture and market numerous lines of rubber tires for

automobiles, trucks, buses, aviation, motor cycles, earth moving and mining

equipments.

In each case, tyres are offered for sale to vehicle manufacturers for mounting

as original equipment (“OE”) and for replacement worldwide. They manufacture and

sell tires under the Goodyear, Dunlop, Kelly, Fulda, Debica and Sava brands and

various other Goodyear owned “house” brands, and the private-label brands of

certain customers. In certain geographic areas they also retread truck, aviation and

off-the-road, or OTR, tires, manufacture and sell farm tires ,manufacture and sell

tread rubber and other tire retreading materials, provide automotive repair services

and miscellaneous other products and services, and manufacture and sell flaps for

truck tires and other types of tyres.

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5.1(X) AL NAURAS RUBBER FACTORY LLC

ANRF emphasized on providing quality rubber products with the latest

technological advance in the RUBBER industry .They are one of the leading rubber

product dealers in the UAE and GCC markets.They specialized in polyurethane

products like rollers, wheel printing rollers, etc. They adopted technology and raw

materials from a reputed UK based Company with ISO-9001. They manufacture

almost every type of Industrial components including the Rollers, Polyurethane

provides very high load bearing capabilities and high abrasion and solvent

resistance. Here shows the industrial components like star coupling.

ANRF’s major products include

1, Rubber Rollers

They are Pioneer Supplier for Rubber roller around G C C Countries for

Printing, Coating, Textile, Cement, Steel Re Bar, and Pipe Manufacturing Industries.

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Major Machines Rollers Like GTO , Man Roland Machines( Chromoman - Polyman

- MR700 ), Ryobi , Heidelberg H B Speed Master 102/VP, Rota speed , SORM/SM

72 OLD MODEL / NEW MODEL, SORM/SM 102 OLD MODEL/NEW MODEL ,

KORS, KOMORI , K B A C213,Adast are manufactured by them. Here shows a

nylon rubber roller

2, Rubber Products

Major rubber products of the company includes NR, SBR, HNBR, EPDM, Silicon,

Neoprene, Hypalon ,  Moulded and Extruded items.The pictures of rubber press

onband wheel and rubber mat are given as under.

Rubber Press Onband Wheel

Rubber Mat

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5.2 SWOT ANALYSIS OF RUBBER PRODUCT MARKET IN UAE

5.2() Meaning and necessity of SWOT analysis

SWOT Analysis is a strategic planning method used to evaluate the

Strengths, Weakness, Opportunities and Threats involved in a project or in a

business venture. It involves specifying the objective of the business venture or

project and identifying the internal and external factors that are favorable and

unfavorable to achieving that objective. The technique is credited to Albert

Humphrey who led a research project at Stanford University in the 1960s and 1970s

using data from Fortune 500 companies. The Fortune 500 is an annual list compiled

and published By Fortune magazine that ranks the top 500 US public corporations

as measured by their gross revenue. Strengths and Weaknesses are internal

factors that create value or destroy value. They can include assets skills or

resources that a company has its disposal, compared to its competitors. They can

be measured using internal assessments or external benchmarking. Opportunities

and Threats are external factors that create value or destroy value. A company

cannot control them. But they are emerging from either the competitive dynamics of

the industry / market or from demographic, economic, political, technical, social,

legal or cultural factors.

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5.2 () SWOT Analysis of Rubber Market in UAE

Strength

One of the largest rubber market in Gulf region, accounting close to 50% of

regional speeding

A trading hub serving the expanding market of Saudi Arabia & Gulf as well as

further-flung regions such as East Africa

There is government support for many projects

One of the major economy of the country

Vast customer portfolio

Marketing many brands

Good will

Location of business-loocal manufacturer

Cost advantage-manufacture supplier

New and innovative products

Qualified and efficient staffs & labs

Weakness

Piracy and parallel imports. Country’s low trade barrier contribute to a growing

problem with counterfeit or grey market goods

Regional economy very dependent on oil, despite diversification effort in many

sectors

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Poor quality comparing to international competitors

Lack of product awareness with European consultants

Opportunities

Fast growing construction industries in UAE

Vast untapped market

High income growth in GCC countries

Stable economy of UAE

Innovation of new products

Strategic alliances

A new international market

Wealthy domestic market offers continued growth potential

Threats

Recession - seriously affected the construction industry all over the world.

Decreasing petroleum products price.

Price war - Chinese and Indian products are cheaper than local products.

Cut- throat competition.

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Non availability of reliable trade partners.

Non availability of qualified and experienced staff.

Entry of new foreign competitors.

5.2 () UAE ECONOMIC SWOT

Strength

UAE is a member of GCC which as well as being a common market, is

targeting a common currency by 2012(although UAE looks, at present,

unlikely to participate)

UAE has one of the most liberal trade regimes in Gulf and aattracts strong

capital flows across the region

In common, with most gulf states, there are high number of experienced

workers at all levels of economy

UAE is progressively diversifying its economy, minimizing vulnerability to oil

price movements

Weakness

UAE’s currency is pegged to dollar giving it minimal control over monetary

policy and reducing the ability to tackle inflatory pressure

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The state’s location in a volatile region means that its risk profile is to some

extent, affected by US concerns about regional militant groups and Iranian

WMD programmes could affect investor perceptions

Opportunities

Oil prices are expected to stay high over forecast period

Economic diversification into gas, tourism, financial services & high tech

industry offers some protection against volatile oil prices

The construction, tourism and financial sectors are growing rapidly driven by

domestic and foreign investments

Threats

Heavy subsidies on utilities and agriculture and an outdated tax system have

contributed to persistent fiscal deficits in the past,although rising oil revenues

have masked the problem in recent years

Some bottlenecks have been forming in construction sector and there is a

chance of delays in several high profile construction projects

5.2 (V) UAE Business Environments SWOT

Strength

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UAE is a member of GCC,a six member common market and has been a

member of WTO since 1996

The state has invested large amount in infrastructure and will continue to do

so over next 10 years

UAE’s diversified economy reduces risk from volatile oil prices

Weakness

Due to state’s federal nature, regulations can vary considerably across the

emirates

The regional economy is oil dependent. This has historically been cyclical

which increase risk for long term project

Opportunities

Large number of free trade zones offering tax holidays and full foreign

ownership comparatively relaxed rule on expertise employment

The UAE’s social stability and relative property means that there is far less

concern for security than in some other gulf states

Threats

The state is bureaucratic relative to regional peers

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Strong oil prices have massively increased liquidity in the region. This has

resulted in strong financial inflows, increasing risk that projects of lower

investment potential are currently being funded

5.3 Region wise Turnover of Rubber Products

Region Turn over Percentage

UAE Dhs 19.8 billion 48

GCC COUNTRIES Dhs 10.8 billion 31

OTHER COUNTRIES Dhs 5.4 billion 21

TOTAL Dhs .36 billion 100

A regional wise study analysis has been made on total turnover of rubber

products and it was found that 48% of total sales turnover is from UAE itself.

Another 31%is from other GCC countries and the balance 21%is from the rest. It

means, the major market for rubber is none other than UAE.

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5.4 Turn over based on UAE Emirates

EMIRATES TURNOVER PERCENTAGE

DUBAI 9.504 BILLION 48

ABUDHABI 6.138 BILLION 31

SHARJA&N.EMIRATES 4.158 BILLION 21

TOTAL 19.8 BILLION 100

Here the chart showing area wise turnover. This study shows that Dubai Emirate is the top is 48%, Abu Dhabi the second with31%and rest five emirates altogether 21%.

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5.5

Turnover based on Nature of Products

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Product Turnover Percentage

IMPACT PROTECTION SYSTEM 36.04 BILLION 65

EPDM GASKET 27.84 BILLION 50

RUBBER SUPPORT 23.10 BILLION 45

BEARING PADS 12.90 BILLION 32

RUBBER SHEETS 9.10 BILLION 28

OTHER PRODUCTS 7.28 BILLION 25

5.6 Competitor Analysis

 RUBTECH IRC HTC AEB ORF OTHERS

CustomerAwareness

5 4.5 2 3 2 1.5

ProductQuality

3 5 3 3 4 3

ProductAvailability

4 3 4 1 3 2.5

TechnicalAwareness

3 2 5 2 1 1

Price 4 3 4 1 3 2.5

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DATA ANALYSIS AND INTERPRETATION

71

CUSTOMERS CHOICE

A customer, also called client, buyer , or purchaser, is usually used to refer to

a current or potential buyer or user of the products of an individual or organization .

The slogans “The customer is king” or “The customer is God” or “ The customer is

always right” indicate the importance of customers to businesses –although the last

expression is sometimes use ironically . Customers are responsible factor for the

sales of any product or services. So, when a new product is launched in the market,

understanding consumer’s buying behavior becomes very essential. For this

marketer has to study and understand the various factors which influences the

customers thoughts while buying any product or services.

Consumer purchases are influenced strongly by four factors.

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Cultural Factors

Social Factors

Personal Factors

Psychological Factors

Cultural Factors

The set of basic values perceptions, wants, and behaviours learned by a

member of society from family and other important institutions. Culture is the most

basic cause of a person’s wants and behavior. Every group or society has a culture,

and cultural influences on buying behaviour may vary greatly from country to

country.

Social Factors

A consumer’s behavior is influenced by social factors, such as the

Groups ,Family, Roles and status

Personal Factors

It includes Age and life cycle stage , Occupation , Economic situation , Life

Style , Personality and self concept.

Psychological Factors

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It includes factors like Motivation, Perception, Learning, Beliefs and

attitudes. Here the data collection method includes both field research or primary

research and secondary research. Here primary research means collecting

information from the customers directly through surveys. Its disadvantages are that

it is expensive to collect, time consuming and needs a large sample size to be

accurate The secondary research is collecting information from the annual reports

of various companies , journals and search engines .The secondary research is

more cheaper and easily accessible. Disadvantages of secondary research are that

it is often not specific to our area of research and data used can be biased and

difficult to validate.

6.1 Evaluation based on Customer Choice

Rubtech IRC HTC AEB ORF Others

Less Preferred 10.00% 25.00% 35.00% 30.00% 45.00% 25.00%Medium Preferred 30.00% 45.00% 25.00% 50.00% 30.00% 40.00%High Preferred 50.00% 30.00% 40.00% 10.00% 25.00% 35.00%

All the above mentioned company’s rubber products has its own advantages.

Some products may have less cost, some having good quality, or some may have

their easily availability. Customers are of different types with different attitudes. Some

customers prefer less costly products .Some may give more importance to quality

than price of products. So it depends on the customer to choose the product and

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most of the customers are not interested to reveal which company’s rubber product

they prefer.

6.2 Analysis Based on Price

Rubtech IRC HTC AEB ORF Others

2008 USD 5.00 USD 4.50 USD 2.00 USD 3.00 USD 2.00 USD 1.50

2009 USD 3.00 USD 5.00 USD 3.00 USD 3.00 USD 4.00 USD 3.00

2010 USD 4.00 USD 3.00 USD 4.00 USD 1.00 USD 3.00 USD 2.50

The under shown chart depicts the choice of the customer based on price.

The choice of the customer may also vary from person to person depending on

different factors

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6.3 Market Demand for Rubber Products

Year 2007 2008 2009 2010

USD $ Billion 5 6.8 10.6 15.7

From the chart, we can conclude that in 2007 the demand for rubber products was USD 6 billion. But now in 2010 its demand reached almost USD 15 billion.

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6.4 Evaluation Based on Quality

RUB TECH IRC HTC AEB ORFOTHER

S

INDUSTRIAL RUBBER PRODUCTS

35.00% 40.00% 50.00% 10.00% 45.00% 10.00%

DOMESTIC RUBBER PRODUCTS

40.00% 10.00% 25.00% 40.00% 20.00% 10.00%

AUTOMOBILE RUBBER PRODUCTS

10.00% 25.00% 10.00% 30.00% 10.00% 10.00%

OTHERS 25.00% 35.00% 30.00% 25.00% 40.00% 10.00%

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In the above table it shows the quality wise evaluation of rubber goods produced by

various industries.

6.5 CHI-SQUARE TEST 

The chi-square (I) test is used to determine whether there is a significant

difference between the expected frequencies and the observed frequencies in one or

more categories ie, do the number of individuals or objects that fall in each category

differ significantly from the number you would expect? Is the difference between the

expected and observed due to sampling error is a real difference?

 

Chi-Square Test Requirements

1. Quantitative data.

2. One or more categories.

3. Independent observations.

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4. Adequate sample size (at least 10).

5. Simple random sample.

6. Data in frequency form.

7. All observations must be used.

 

 

 The following five suppliers are the major market players in the UAE.

According to the expected frequencies or number of customers choosing each

supplier should follow the percentages of last year. Let us take 33% would choose

Rubtech, 23% would choose IRC, 13% would choose Hamburg, 23% would choose

Ocean Rubbers and 7% would choose other suppliers. Now took a Random sample

of 150 customers and asked them their preferences. The results of this poll are

shown in Table

 

 

Supplier Category

Observed  Frequency

Expected Frequency

Rubtech 50 45

IRC 35 30

Haburg 20 15

Ocean Rubbers

35 45

Others 10 15

The expected frequencies in Table  are figured from last year's percentages.

Based on the percentages for last year, we assumed 30% for Rubtech. The assumed

frequencies for Rubtech 30%  of the 150 customers, getting an expected frequency

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of 45 people for this category. For the IRC we assumed 20% out of 150 or 30 people

to fall in this category. Using this method, Thai figured out the expected frequencies 

45, 30,15,45, and 15. Obviously, there are discrepancies between the Supplier

preferred by customers. We needs to know whether or not the discrepancies

between last year's choices (expected frequencies) and this year's preferences on

the basis of observed frequencies demonstrate a real change in customer 

preferences. It could be s the differences are simply a result of the random sample I

selected. If so, then the population of customers really has not changed from last

year as far as Supplier preferences. The null hypothesis states that there is no

significant difference between the expected and observed frequencies. . The level of

significance (the point at which you can say with 95% confidence) is set at .05

Supplier Category

Observed  Frequency   

(O)

Expected Frequency

(E)(O – E) (O - E)2

(O - E)2 / E

Rubtech 50 45 5 25 0.55

IRC 35 30 5 25 0.83

Haburg 20 15 5 25 1.66

Ocean rubbers

35 45 10 100 2.22

Others 10 15 -5 25 1.66

     

TotalX2 = 6.922

  

Where    

O is the Observed Frequency in each category

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E is the Expected Frequency in the corresponding category

Df is the "degree of freedom"

X2 is Chi Square

Chi Square X2 = 6.92 (Calculated Value)

Degree of freedom (Df) =  4

Table value = 9.49 at 5% level of significance 

We accept the null hypothesis, Means that the expected Frequencies (based

upon last year’s sales) and the observed frequencies (based upon this year's poll)

are Independent.

 

Since the calculated value of Chi square lies in the accepted region we accept the null hypothesis.

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6.6 INDUSTRIAL FORECAST SCENARIO

Macroeconomic Forecast

UAE has experienced recession in 2009 along with other parts of the world .

Major features of recession in UAE echoed in lower oil prices- and reduced

investment spending. The downturn will bring employment regulations to the fore,

as the government balances the need to encourage continued immigration while

protecting the employment of UAE citizens.

While recently released figures from the Ministry of Economy confirmed the

UAE's strong economic expansion in 2008, we believe that government bullishness

regarding the effectiveness of its fiscal rescue package is somewhat misplaced. We

remain bearish regarding the country's growth prospects this year; indeed we are

now forecasting an outright recession, with the economy expected to contract by

1.7%. In our view, government spending will limit the downside and stave off job

losses in key sectors, but will not be sufficient to fully counteract the contraction in

trade volumes, the slowing of consumer spending on the back of population losses

and the severe cutting back of investment plans.

Good Times Are Past

A recent statement by Sultan bin Saeed aI-Mansouri, the UAE Minister of Economy,

put real GDP growth at 7.4% in 2008, slightly above our 6.9% estimate for the year.

While we are still awaiting a full breakdown of GDP by expenditure from the ministry

or the central bank, the minister's statement confirmed a number of key trends that

we were following throughout the year. Most important of these was the surge in oil

revenues as prices peaked in the middle of the year. Overall, the contribution of the

oil sector to GDP rose from 35.9% in 2007 to 37.9% in 2008. The second trend was

the sharp upswing in investment spending,much of which was ploughed into real

estate developments. Both these trends have already witnessed a sharp reversal. On

the oil front, we recently raised our forecast average annual price to US$45.50/bbl for

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the OPEC Basket in 2009, up from our previous figure of US$39.50/bbl. However,

this is still less than half of the 2008 average of US$95.40/bbl. Oil prices are likely to

creep up again as global demand recovers in the second half of this year and from

2010 onwards, but we believe a return to 2008 levels is unlikely in the foreseeable

future. Even by 2012, we are forecasting an average price of DS$71.50/bbl, broadly

on a par with 2007. Lower oil prices, combined with stricter lending requirements by

banks and greater caution among investors whose fingers have been burned (or are

still getting burnt) by the collapse in real estate prices will also translate into less

exuberant investment plans. We see real growth in gross fixed capital formation

(GFCF) remaining in single digits over the next two to three years, rather than the

rates of 15-20% (or likely even higher in 2008) seen over the past three, as plans for

many real estate projects are shelved, others are scaled back and the government

begins to play more central role in infrastructure development.

Acknowledging the Problem

While the economy ministry is painting a bullish picture, comments from

elsewhere in the ruling elite suggest that the government does recognise the

magnitude of the challenges facing the DAE economy this year. In mid-March, the

central bank governor, Sultan bin Nasser al-Suweidi, admitted that growth was likely

to slow to low single digits, or could even turn negative, this year. He promised

interest rate cuts to stimulate growth, although as is the case around the world, the

real problem is translating central bank cuts into lower market rates for consumers

and businesses. At the time of writing, the DAE interbank offered rate (AEIBOR)

stood at 2.9188%, compared with a central bank repo rate of 1 %. Another key area

where the government is sitting up and taking notice is population growth. We have

long argued that a steady expansion of the population is essential to the UAE's

growth plans. Immigration, by both highly skilled white collar workers and unskilled

laborers, has fuelled the country's recent boom. Highly skilled migrants have

brought experience and expertise in key non-oil sectors such as financial services

and construction, while laborers from south Asia have provided the manpower for

the bulk of construction projects. On top of this, steady population expansion has

83

driven increases in consumer spending and fuelled demand for housing, particularly

in Dubai, the first Emirate to allow foreign ownership of property.

With many construction sites now lying untouched, large numbers of laborers

have lost their jobs and redundancies have spread to office workers in the real

estate and financial sectors. With most visas for foreign workers tied to

employment, those that lose their jobs often have only a few weeks in which to find

new employment before being forced to leave the country. The scale of recent

emigration is unknown; the ministry of labour has insisted that thousands of new

work permits are still being issued, although it is not clear what proportion of these

are simply renewals of existing permits.In 2009, we are currently forecasting a 1%

contraction in the total population to 4.67mn. However, the government is reportedly

re-examining its immigration regulations, with a view to making it easier for

unemployed expatriates to remain in the country while they search for new jobs.

Without changes to the current system, Dubai - probably the Emirate most reliant on

foreign labour - has little chance of achieving its 3% workforce growth target in 2009

(even with these changes, we think this figure is optimistic).

Employment Nationalism

But at the same time as it tries to retain foreign workers, the UAE is also

keen to shield its native population from the Impact of the economic downturn.

Dubai recently launched another 'Emiratisation' drive, aimed this time at increasing

the proportion of UAE citizens employed in the public sector (previous initiatives

have tended to focus on encouraging private firms to take on more local staff).

Recent research by the UAE University found that among over 120 private firms

surveyed, less than 1% of their employees were Emirati. Figures were much higher

in the public sector, but still not high enough according to Sheikh Mohammed bin

Rashid, ruler of Dubai and the UAE's Prime Minister. Just 25% of staff at federal

84

authorities, and barely more than half of those employed in ministries, are UAE

citizens.The poverty that often accompanies unemployment is not such an issue in

the UAE - the. government has always provided its citizens with a generous range

of welfare benefits, ranging from free education and healthcare to subsidised land

and loans for house building. That said, with a young population, providing enough

jobs is still a concern and job losses among Emirati staff will always be unpopular,

particularly when there are still large numbers of foreign workers still employed in

the UAE. However, until now the government has tried to tread carefully. Rules on

emiratisation have not been strictly applied, as the state recognized the tradeoff

between boosting domestic employment levels and remaining competitive.

UAE - ECONOMIC ACTIVITY

     Table: UAE - Economic Activity

   

2005 2006 2007 2008 2009 2010 2011 2012 2013

Nominal GDP, AEDbn

485.5 624.6 729.7 855 833.8 939.8 1,085.40 1,238.20 1,351.90

Nominal GDP, US$bn

132.2 170.1 198.7 268.1 227 255.9 295.6 337.2 368.1

Real GDP growth, %

Change y-o-y 8.2 6.6 5.2 6.7 -1.7 3.9 4.8 3.9 5.3

GDP per capital

32,197 40,218 44,254 56,858 48,643 53,753 59,694 65,480 68,740

Population,mn 4.1 4 4.5 4.7 4.7 4.8 5 5.1 5.4

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6.7 To Improve the Market Share of Rubber Goods

Global Demand to Climb 10.5% Yearly Through 2013

Global demand for industrial rubber products is forecast to climb 10.5 percent

annually through 2013 to nearly $110 billion. Market advances in developing areas will

be fueled by healthy economic growth, ongoing industrialization efforts and rising

personal income levels, bolstering manufacturing output and fixed investment

expenditures. In addition, higher living standards will help stimulate demand for

automobiles and other industrial rubber product-containing durables, boosting both

original equipment (OEM) and maintenance/repair/operations (MRO) industrial rubber

product sales. Mechanical rubber goods, which include body seals, vibration control

products, wiper blades and a variety of miscellaneous goods such as bellows, bumpers,

duct covers, mallets, pads, plates and trim, comprised the largest product segment in

2008. Suppliers of mechanical rubber products will benefit from continued gains in

motor vehicle production through 2013, as these products are highly represented in this

market. Industrial equipment -- which includes industrial machinery and equipment as

well as off-road vehicles -- will continue to comprise the largest end-use market in 2013.

Demand in this market will benefit from rising demand for heavy industrial equipment

such as construction and mining machinery.

Mature Markets In Developed Regions Also See Gains

Industrial rubber product demand in the US, Western Europe, Middle East and Japan

will rise as well. Advances will be spurred by largely favorable economic climates and

higher per capita income, resulting in increased manufacturing activity and consumer

spending for durable goods. Although representing mature markets, these areas --

along with Australia and Canada -- will remain the most intensive users of industrial

86

rubber product products because of the advanced industrial and technological nature of

their economies. The large numbers of industrial rubber product-containing equipment

in use will also help bolster aftermarket industrial rubber product demand.

UAE Demand to Increase 6% Annually Through 2014

The UAE market for industrial rubber products is expected to recover from the declines

registered during the 2004-2009 period and increasing 6.0 percent per year to $17.7

billion in 2014. Rebounding motor vehicle production will support demand increases, as

will accelerating output in the machinery industry. Furthermore, continued growth in

both aerospace equipment shipments and nonresidential building construction

expenditures will benefit manufacturers of industrial rubber products. Competition from

suppliers in low-cost countries and moderating raw material costs will hold back price

increases, limiting value gains to some degree. In addition, industrial rubber products

will continue to face competition from less expensive plastic goods in a number of

applications.

Mechanical Rubber Goods to be Fastest Growing Type

Sales of mechanical rubber goods will post the strongest increases of any major

product category through 2014 and will continue to account for the largest share of

overall demand. Demand for mechanical rubber goods -- including body seals, vibration

control products, wiper blades and a range of miscellaneous products -- will be boosted

by rebounding motor vehicle production. With the exception of rubber roofing, every

major product category is forecast to improve from 2004-2009 performance. Sales of

industrial hose and belt products will be boosted by the wide diversity of uses for these

products. Furthermore, hose and belt products have a stronger price outlook relative to

87

mechanical goods. Rubber roofing is largely utilized in nonresidential building

construction and expenditures in that market are forecast to slow through 2014.

Industrial, Off-Road Machinery to Remain Largest Market

The machinery market, including both industrial machinery and off-road equipment, will

continue to account for the largest share of industrial rubber product demand through

2014. A range of industrial rubber products are utilized in this market and, as machinery

output accelerates from the sluggishness experienced during the 2004-2009 period,

manufacturers of associated rubber products will benefit.

Motor Vehicles to Be Fastest Growing Market

The motor vehicle market for industrial rubber products is forecast to register the

strongest gains through 2014. Automotive manufacturers utilize a variety of industrial

rubber products including mechanical goods, hoses, belts and miscellaneous other

items. Through 2014, UAE motor vehicle production will make a strong recovery from

the low level of 2009. As a result, suppliers of associated industrial rubber products will

see a significant rebound in sales. However, automobile production is forecast to

outpace light trucks, vans which will restrain advances to some degree as smaller

vehicles tend to utilize fewer rubber products. Gains will also be tempered by the

significant pricing pressures exerted by the large automotive companies. Other markets

for industrial rubber products -- including construction, aerospace and other

transportation equipment, and various smaller markets -- will  improve from 2004-2009

performance, through at a slower pace than the motor vehicle and machinery markets.

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6.8 Challenges on Rubber Industry

Rubber product industry while plenty of room for future market, but it also faces

severe challenges. The rapid development of automobile and manufacturing industries,

making China become the rubber consuming country, according to statistics from

related departments of China's rubber consumption in 2001 for the first time surpassed

the United States as the world's largest consumer and importer in 2003, has become

the world's the second-largest tire producer and exporter of natural rubber consumption

in 2004 reached 1.8 million tons, accounting for 21.5% of total global consumption.

Currently include Michelin, Bridgestone, Goodyear, Jia Tong and other tire

manufacturers have the world's largest joint-venture factories in China, further

exacerbating China's rubber consumption of resources.

  Automobile rubber products, including raw materials used in almost all the synthetic

rubber, such as CR, SBR, NBR, HNBR, CM, ACM, ECO, VMQ, FKM and so on. In

recent years, special rubber applications in cars increasing, such as fluorine rubber,

polyacrylate rubber, hydrogenated nitrile rubber, epichlorohydrin rubber, silicone rubber.

Automotive rubber products in need of raw materials while China can produce rubber,

but most people cannot meet the performance requirements, so imports remain high.

And along with oil prices high, the cost of synthetic rubber production rising for

automotive rubber products industry constitutes a tremendous pressure. Due to the

continuous improvement of the level of car design on the medium of performance used

in demanding, so automotive rubber products industry continued to face and solve new

issues, the pressure to meet the new requirements. Such as cars compact design,

resulting in poor heat dissipation, the temperature under the hood getting higher and

higher; the continuous introduction of new lubricating oil; automotive air conditioning

non-fluoride; new synthetic brake fluid applications, and so on. These are the

automotive rubber products, heat resistance, oil resistance, chemical resistance and so

on newer and higher requirements need to be completely resolved. The strengthening

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of environmental awareness, the introduction of new emission regulations, resulting in

automobile engine continuously improve fuel combustion efficiency, which led to related

rubber products at a higher intensity of work, the traditional rubber products have been

unbearable.Prohibit the use of lead-sulfide additives, the alternative is a new auxiliary

aids mostly require the use of a higher intensity of hose, the result has greatly increased

the cost of manufacturing rubber products.Due to automobile rubber materials and

products industry are auto parts category, at present the continuous influx of foreign

investors, and become wholly-owned factories, making the domestic automobile rubber

materials and products was white-hot competition in the market trend. According to

incomplete statistics, the current domestic influential non-tire automotive rubber

products has reached more than 70 foreign investors, including from the United States,

Japan, Europe and other countries of the foreign capital of nearly 40, more than 30

Hong Kong, Macao and Taiwan-funded enterprises, many of whom are internationally

renowned businesses, varieties covering all areas of automotive rubber products.

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FINDINGS, SUGGESTIONS AND CONCLUSION

7.1 Findings

Although, the production and export of oil and gas has provided the fuel for the

rapid economic development of the UAE, since its creation in 1971, the government has

long recognized the need to diversity away from those depletable sources. Substantial

investments have been made by both the public sector and the private sector in the

development of heavy and light industry and in the construction sector. Being the

regional trade centre, the UAE has also emerged in recent years as the preferred

regional base for a host of major international companies. The Construction Industries

in the UAE is also facing a setback because of the international economic crisis, but

however it can withstand with the help of government support.

Rubber is an integral part of Construction Industry, even though the cost

constitutes less than 1%of the total project cost. Rubber enjoys 35%to 40% of the total

market requirements of total products in construction sector. The following findings are

made from the analysis of this study.

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UAE occupies the major market for the rubber products. Among the emirates in

UAE, Dubai is the largest consumer followed by the Abu Dhabi. However, there is a

vast potential market for rubber in UAE, especially in the Abu Dhabi sector. Growth has

also been driven by government policy. Low import duties, as well as direct supplies

from manufacturers, have contributed in keeping prices in UAE 15-20% lower than other

markets . They has also invested to diversify the economy away from dependence on

oil and develop trade specific cities through various projects

As a result, vendors increasingly see UAE as a distribution hub of global rubber

market rather than merely regional significance. Indeed, some Far East buyers now

include UAE in their itineraries. As more vendors have established facilities in the UAE,

this in turn has brought more expatriate workers.

Major product of rubber in demand is Impact Protection System Which

constitutes 50% of the total sales turnover. EPDM gaskets are also in the main role to

provide revenue and the other products contribution is seems to be very less.

The price charged by the rubber products in UAE are comparatively reasonable

and this is one of the major reason for the rubber product preference instead of other

substitutes.

Normally Rubber Company is supplying goods within the time limit specified in

the quotation. The functioning of Marketing Department of almost all companies seems

to be perfect in this angle.

The major competitors in rubber market are also seems with quality products and

best after sales service. Their performance is more or less equally impressive in the

market.

Over the years the composition of the UAE rubber retail sector has experienced

a number of revolutions. The traditional domination of smaller stores has been diluted

by the appearance of multi brand sections in hypermarkets. These superstore retailers

are now estimated to have a 40% share of product sales with at least 200 outlets in the

UAE.

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There is a vast potential for rubber products in the UAE market as well as in

other GCC countries

As the UAE has established itself as a leading regional and global marketplace

for rubber products, multinational corporations have established assembly facilities in

Dubai and its adjacent free trade zones. Dubai-based companies now supply markets in

East Africa and the CIS as well as the Middle East, and even the Far East. Therefore, it

makes sense for major rubber vendors to shift operations closer to their markets.

Many export oriented schemes are available in the Jebel Ali Free Zone, which

accounts for a large portion of exports. However, the free trade zones are also a source

of grey market imports, fostered by the re-export channel. As a result some vendors

now stipulate in contracts that distributors can only sell goods intended for the market

that they have been assigned. In the past, there was little production of rubber

components in the UAE, but this is changing with government initiatives to improve

rubber product manufacturing.

7.2 SUGGESTIONS

“On one hand, business rests on the technical processes of trade and

Manufacture .On the other hand it looks to the market. At the junction stands the

businessmen either directing the technical process of production or gauging market, or

doing both, but always engaged in buying and selling for the purpose of gain”

(Prof. Haney, Business Scientist.)

The above statement satisfies the features of a business and is its spirit. Rubber

Industries seems to be a big success in the business and present in the market

construction sector of UAE, by meeting the requirements of customers .However there

are certain areas the companies must concentrates inorder to maintain full satisfaction

to the customers

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The analysis on rubber product shows that the real potential in the rubber

industry even in the recession period have increased especially in UAE.There is still

more space for new rubber products to be survived and get market share.We highly

recommend on bringing more new products after proper research as per customer

requirement.

Most of the rubber product requirements are met from the imports from different

countries .Sometimes cheap quality – low priced materials makes confusion to the

potential buyers to use as component for their products –especially Chinese materials .

Quality checking system is not implemented in UAE to verify the usefulness and after

effect of these cheap quality products. It is suggested that quality assurance system

may also be implemented in all the 7 Emirates of UAE on rubber products so that

quality assurance on End products can be implemented.

A major defect of the most rubber goods is the presence of an unpleasant odour

of rubber.So odourless rubber materials should be recommended highly.Increase local

manufacturing to provide the competitive advantages. Rubber products are known in

the market mainly because of its participation in international exhibitions of construction

materials. It is advisable to continue with the present marketing strategy and find out the

new markets. More attention can also be given for personal selling.

A business must earn profit for its own survival, for expansion, for bearing the

risks and finally for the prestige of management. But profit cannot be the sole objective

of business. The pricing policy of the Rubber products must be reasonable. Their main

aim should be customer satisfaction. Have more products in all kind of stores and run

different kind of promotions to make people to buy the rubber products

7.3 CONCLUSION

To improve the market, we should tackle the challenges for the growth of

rubber industry and look into the drivers to manage the growth properly. Local

manufacturers have good market and business should explore this area to increase

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their market share. Through this study, I have seen that there are people who buy the

product without considering the brands but the lower price. There are vast potential for

rubber products in the UAE market as well as in other GCC countries

BIBILOGRAPHY

Following references have been used to prepare this analysis report:

Business Magazine (www.world-newspapers.com)

Business Week (www.businessweek.com)

Gulf Business (www.gulfbusiness.com)

Dubai Business Magazine (www.dubaibusinessmagazine.com)

Emirates News Agency- WAM (www.wam.ae)

Gulf News Newspaper ( www.gulfnews.com )

The National Newspaper

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UAE Interact (www.uaeinteract.com)

Ministry of Economy (www.economy.com)

Arabian Business ( www.arabianbusiness.com )

AME Info ( www.ameinfo.com )

Marketing Management by Philip Kotler

Sales And Distribution Management -Dr .V .Balu

Modern Marketing Management - Rustom .S.Davar

Marketing Management- Rajan Nair

QUESTIONAIRE

1. Are you a regular Customer of Rubber Products?

Yes

No

2. From Which media you are getting information about your rubber requirements?

Advertisement

Publicity

Personnel Selling

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Reference

Others

3. When you are regularly dealing with same suppliers?

Yes

No

4. What is your preference?

Price

Quality

Service

5. How often you buy Rubber products?

Weekly

Monthly

Yearly

6. Which Companies Rubber products you Prefer?

RUBTECH

IRC

HTC

ORB

AEB

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7. What is your preference for buying Rubber Products?

1 2 3 4 5 6 7 8 9 10

Cost 

Brand Name

 

Features 

Customer Service

 

8. Whether you are satisfied with the quality of Rubber products available in the market?

9. Are you satisfied with the after Sales Service of companies dealing with rubber products?

10.How you rate the price of the product?

Low

Reasonable

High

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11. Your Details?

a. Name of the company

b. Place of Business

c. Nature of Business

d. Telephone No

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