According to data released by the National Bureau of Statistics, the total tire production in the Mainland in the first half of 2010 was 312.3 million, an increase of 31% year-on-year. Under the background that the US tire special security case was shortly passed and the financial crisis was difficult to fully emerge within a short period of time, this figure has caused many industry insiders to worry: China's tire industry has seen excess capacity. The reporter recently interviewed Guangrao County of Shandong Province, a “China Rubber Tire Export Baseâ€, and found that the domestic tire industry is currently facing many problems, such as overcapacity, large fluctuations in the prices of raw rubber at the upstream, and uncertain internal and external sales markets. The Guangrao County, which has a tire production capacity of 19% of the nation's tire production specialties, is worth learning from the experience gained by adjusting the industrial structure and base development.
The reporter got such a set of data. According to statistics from Guangrao County Bureau of Foreign Trade and Economic Cooperation from January to June, Guangrao County's tires in the first half of the year achieved exports of US$531 million, an increase of 53.3%, accounting for 88.6% of the county's total exports. In the first five months, the county's tire industry achieved a total output value of 14.6 billion yuan, an increase of 45% year-on-year, and realized profits and taxes of 1.93 billion yuan, a year-on-year increase of 73.5%. The increase was basically the same as in 2009. From the data point of view, the county tire production and sales did not appear worrying trend.
The impact of the United States tire "special protection case", after nearly a year's adjustment of the export structure and other response measures, the impact seems to be gradually disappearing. The Guangrao Bureau of Foreign Trade and Economic Cooperation said that the county’s tire export destination includes more than 100 countries and regions such as the European Union, Australia, Canada, and the Middle East, and exports to the United States account for only about 10% of total exports.
Upward fluctuations in raw material prices
Although the impact of the special safeguard case is not as large as it seems, good statistics and active countermeasures will not fully dilute the problems existing within the tire industry. The first is the large fluctuations in the price of rubber in the upstream raw materials. As the main raw material for tire production, rubber has a high degree of import dependency in China. As of June 2010, due to the speculation of hot money, the price of rubber rose by nearly 10,000 yuan per ton compared with 2009. Yongtai Group's Minister of External Relations, Cao Yubo, also told reporters that the large-scale investment of hot money is constantly creating rubber dealers overnight riches and overnight legend of poverty, "a period of time, rubber fell from 30,000 yuan per ton to 1 Ten thousand yuan took only 2 weeks."
Another large tire manufacturing manufacturer in Guangrao, Xishui Group, has been cooperating to plant rubber forests in Laos since 2006. The current area has reached 300,000 mu. After the rubber tree produces rubber, it can save at least 30% of the capital per ton, which greatly expands the profit margin. However, this model is difficult to promote on a large scale in tire companies and cannot fundamentally change the external dependence of rubber.
Guangrao County ranks 73rd in the top 100 counties in the country, owns 3 top 500 Chinese enterprises, and is an economically developed county in central Shandong Province. A large number of enterprises have basically all digested the local surplus labor force. The situation of “a hard-to-find work†has caused the wages of local workers to rise. It is reported that there are more than 30,000 employees in the Guangrao tire industry, and the average monthly wage of front-line workers is 3,000 yuan. In Yongtai Group, a skilled worker can earn 100,000 yuan a year. Even with such a high salary, Cao Yongbo said that Yongtai still has problems in recruiting workers.
Over half a year or more
Data show that in May 2010, the tire production in the Mainland was 74.16 million, an increase of 25% year-on-year, and an increase of 1.6% from the previous period. In the same month, China’s auto production was 1,131,700 units, a decrease of 14.36% compared to the previous period; sales volume was 1,194,700 units, a decrease of 13.95% compared with the previous period. Some analysts pointed out that due to the continuous increase in international trade friction and the expansion of tire companies, the mainland tire industry has faced the issue of excess capacity, in the second half of 2010 or early 2011 this issue may be highlighted.
Yongtai Group is a tire production company with a high degree of export dependence in Guangrao. It is also the most affected by the United States “tire special protection caseâ€. Before the “special security caseâ€, 80% of the Group’s products depended on exports, and the United States accounted for more than 80% of exports. Nearly 70% of the company's semi-steel mid-carrie tires are sold to the United States, and 20% of them have identified the need for high tariffs in the “special security caseâ€.
According to Cao Yubo, Minister of External Relations of Yongtai Group, the United States Government announced that in the first year of tire imports from China, it was 35% in the first year of September 2009 and 30% in the second year after the coordination with other tire manufacturing companies went to the United States. The third year is a 25% punitive tariff rate. Wing Tai then actively negotiated with its dealers in the United States, passing 10% of the costs incurred to local consumers. The remaining parts are internally digested through energy conservation and consumption reduction. More importantly, Wing Tai began to adjust its own sales structure and newly developed foreign markets such as France, Germany, Australia and Singapore in a one-year period. Cao Yubo said that Yongtai is also actively adjusting its internal and external sales structure and further increasing the proportion of domestic sales. After a series of efforts, Yongtai has basically got rid of the "special protection case". [next]
High-end products with strong competitiveness
Cao Yubo, who has many years of experience in the industry, is not rumored about the overcapacity in the industry. However, he also said that at present there is no worry, Yongtai Group's products are mainly in the mid-to-high end market. At present, only three companies in China can produce F1 racing special tires. Yongtai is one, and its profit is equivalent to 2-3 times that of ordinary products. High-end products have a stronger ability to counter risks. In his opinion, what is more worrying is those companies that focus on low-end products.
In addition, he pointed out that after more than 30 years of development, the tire industry in Guangrao County has become an internationally renowned tire industry base. Each enterprise in the area has a number of distributors that are distributed all over the world for years. The group size of many companies has enabled Guangrao to occupy the forefront of the list of buyers. In order to further expand the clustering effect of Guangrao tyres, Guangrao hosted the 2010 China International Rubber Tire & Auto Parts Exhibition in May 2010, attracting more than 500 companies from 45 countries and regions to attend the event, and signed a total of 31 investment projects. Invested RMB 5.155 billion, plans to introduce 1.886 billion yuan of funds, and signed 4 technical cooperation projects.
Industry Call: Alert the tire industry to blindly expand its own brands
Recently, Yokohama Rubber (China) Co., Ltd. held a grand celebration to celebrate the official foundation of its subsidiary, Hangzhou Yokohama Tire Co., Ltd. Phase IV expansion project. After completion of production, the company's tire production capacity will increase from the current 3 million to 5.1 million.
According to statistics, this is the fourth foreign-owned tire company that announced the implementation of a capacity expansion plan in China after Bridgestone, Continental, and Michelin in the past year. At the same time, since 2009, some independent brand tire companies from Shandong, Shanghai and other regions have also intensified their expansion efforts, many of which will be put into operation in 2010. Some industry sources are concerned that the unprecedented scale expansion of domestic tire companies is likely to cause the Chinese tire industry to face a situation of excess capacity, which will affect the healthy development of the entire industry.
Foreign-funded enterprises have increased their production expansion
Foreign brands account for as much as 70% of the passenger car tire market in China. They also occupy a large market share in the high-end truck and passenger car tire markets. In recent years, benefiting from the rapid development of the Chinese auto industry, foreign tire companies have made huge profits in the Chinese market. Today, foreign companies have further increased their investment in China in order to obtain more lucrative returns.
In April 2009, the aftermath of the international financial crisis was unresolved and the outlook for the Chinese auto industry was unknown. However, the international tire giant, Bridgestone, still had high hopes for the Chinese market. On the eve of the Shanghai Auto Show in 2009, the company announced a capital increase of US$98 million for its Wuxi plant. It plans to increase its daily output by 8,000 to 12,000 in July 2011.
A few months later, given that China’s auto industry has emerged from the international financial crisis at an alarming rate, internationally renowned tire suppliers that have been hit by the international financial crisis—the German mainland and the French Michelin have successively decided to invest 800 million yuan and 1 billion yuan respectively. The dollar is used to build a production base in China.
In October 2009, when Yokohama Rubber formulated the capacity expansion plan, it deliberately incorporated the expansion plan originally planned for the fifth period into the fourth period, increasing the production capacity by 2.1 million in a one-time increase to accommodate the continued Chinese tire market. Increased demand. "Yokohama sold about 2 million Yokohama tires in the Chinese market in 2009. It is expected that after two years, the aftermarket will have the same size demand." Yokohama Rubber (China) Co., Ltd. Chairman Gao Jingxing Said children.
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