Multiple factors affect Guizhou Tyre overseas market

Recently, Guizhou Tyre (also known as Advance Tyre) disclosed utilising production capacity. In 2022, China has implemented relatively strict control measures against the epidemic, and the logistics are not smooth, which indirectly leads to weak demand for truck and bus tyres. Affected by the above factors, Guizhou Tyre’s domestic plant has a capacity utilisation rate of around 80 per cent for all-steel radial tyres. Over the same period, capacity utilisation for OTR tyres was about 95 per cent.

In addition, Guizhou Tyre stated that the Vietnamese factory’s market cultivation had not met expectations, and the capacity utilisation rate was around 60 per cent. According to the company, headwinds that have affected overseas factories include the conflict between Russia and Ukraine, exchange rate movements, and congestion at US ports earlier this year. It is reported that to obtain more orders, Guizhou Tyre has dispatched seven teams to expand overseas markets, striving to increase the Vietnam factory’s production capacity utilisation rate as soon as possible.

According to the production capacity design plan, the Guizhou Tyre Vietnam factory can produce 1.2 million all-steel radial tyres annually. If the capacity utilisation rate is maintained at 60 per cent, the overseas factory now produces about 720,000 tyres per year or about 60,000 tyres per month. According to the company’s semi-annual report data, the Vietnamese factory produced 306,200 tyres and sold 249,200 tyres in the year’s first half.