Goodyear Keeps it Local in China

The recently reported capacity expansion plans for Goodyear’s Dalian plant in China – to 17,000 tyres a day or 10 per cent of global production – will mostly be supplied from local sources. Over a number of years Goodyear has shared its technology with a number of Chinese companies, and these firms are now playing an ever-larger role in keeping the materials required for making tyres coming into the plant.

Local suppliers include Jiangsu Xingda Steel Tyre Cord Co. Ltd., who provide steel cord; Jiangsu Junma Group for nylon 6 yarn; China Shenma Group for nylon 6,6; and carbon black supplier Jiangxi Black Cat Carbon Black Co. Goodyear plans to source between £300 million and £500 million worth of materials from China by 2010.

And just as much of what enters the factory is from local sources, much of what comes out is also staying close to home. A large chunk of the Dalian factory’s output is being taken up by Chinese based vehicle manufacturers for OE fitment. Goodyear is the exclusive tyre supplier for BMW in China, and the tyremaker also supplies to Shanghai Volkswagen Automotive Co., FAW-Volkswagen Automobile Co., Great Wall Motor Co., Brilliance Jinbei Automobile Co., as well as local Toyota, Nissan and Honda operations.

Aftermarket sales are being taken care of by a network of 700 Goodyear branded independent shops, the Goodyear Authorized Service Network. According to Goodyear’s Asia Pacific region president Pierre Cohade, a high proportion of motorists with Goodyear fitted to their vehicle as OE return for more Goodyear tyres. As first generation drivers, he comments, Chinese customers show a fair degree of brand loyalty.