Revenue of Double Coin parent (Huayi) exceeded 10 billion yuan in 2022

Recently, Shanghai Huayi, the parent company of Double Coin, announced its operating data for 2022. In 2022, the revenue of Huayi’s tyre segment reached 10.02 billion yuan (approximately £1.175 billion; €1.338 billion), a year-on-year increase of 6.62 per cent. Regarding net profit, Huayi relies heavily on Huayi Group (Hong Kong), which is responsible for overseas business (especially the business of factories in Thailand). During the reporting period, Huayi Group (Hong Kong) achieved a net profit of 172 million yuan (about £20 million; €23 million). The Double Coin Tire Group, responsible for Huayi’s domestic tyre business in China, lost 26.4318 million yuan (about £3.1 million; €3.53 million).

Huayi said that its output of all-steel radial tyres ranks among the top in China. In the past year, through cooperation with domestic and foreign bases and brand advantages, it has actively participated in domestic and overseas market expansion. The annual production, sales and inventory of Huayi’s tyre business were 12.9457 million (down 7.59% year-on-year), 13.1623 million (down 4.16%) and 1.7512 million (down 11.01%), respectively. The production capacity usage of each tyre manufacturing base is as follows:

• 86% at the Jiangsu TBR tyre manufacturing base (designed annual production capacity of 3.6 million units)
• 73% at the Chongqing TBR base (designed yearly production capacity of 2.5 million units)
• 99% at the Xinjiang TBR base (designed annual production capacity of 1.95 million units)
• 76% at the Anhui PCR manufacturing base (designed yearly production capacity of 6 million units)
• 116% at the Thailand TBR manufacturing base (designed annual production capacity of 1.2 million units)

In the annual report, Huayi summarised the status of China’s tyre industry in 2022: the overall tyre industry is running weakly, but exports still provide firm support. Expressly, “Affected by the slowdown in demand growth in the Chinese market, the production of tyre companies was limited, and the total supply of tyres had a slight downward trend. Among them, the replacement market for semi-steel radial tyres was weak, resulting in poor market demand and a decline in the operating rate of enterprises. Affected by the slowdown of (China) national infrastructure projects and the weakening of logistics and transportation, the demand for all-steel radial tyres generally declined. However, there was a gap between supply and demand in overseas markets. China’s tyre exports are strong, and both the annual export volume and export value have achieved growth”.

In addition, Huayi forecasted China’s tyre market in 2023. Leading tyre companies will continue to increase expansion efforts, promote industry integration, accelerate the elimination of backward production capacity, seize opportunities in overseas markets, and increase overseas production capacity. With the substantial increase in market demand for new energy vehicles, tyres for new energy vehicles are ushering in new opportunities. Under the background of accelerating investment in energy and new infrastructure, the demand for special tyres such as mining truck tyres and giant engineering tyres will increase significantly. At the same time, China is implementing a policy of controlling carbon emissions, and the green tyre market will grow rapidly. Double Coin has multiple production bases in China and Thailand. It will actively optimize the production capacity layout next year, keep up with the growth of various market segments in the tyre industry, and further develop mid-to-high-end and differentiated tyre products.