Guizhou/Advance Tyre enters the PCR market

Guizhou Tyre’s board of directors has approved a plan to build a semi-steel radial tyre production line with an annual output of 6 million units at its Vietnam factory. This move means that the tyre manufacturer, which focuses on the production of TBR and OTR, is beginning to enter the PCR market.

Guizhou Tyre is set to enter this segment via an investment of around US$230 million (about £181 million; €211 million), the construction period is 12 months, and the design production capacity will be reached in the fourth year. However, the tyre manufacturer did not disclose when construction of the PCR production line would begin. According to Guizhou Tyre, the investment plan still requires approval or filing by relevant departments in China and Vietnam before it can be finally implemented.

The tyre manufacturer said it would increase capital by $68.329 million (approximately £53.65 million; €62.73 million) to its company in Vietnam through its subsidiary. The remaining funds will be applied for loans from banks.

Information disclosed by Guizhou Tyre shows that in the first three months of 2023, the revenue and net profit of the Vietnam factory was 786 million yuan (about £85.75 million; €100 million) and 146 million yuan (about £15.9 million; €18.6 million). In comparison, the tyre manufacturer’s two figures from January to September 2023 were 7.04 billion yuan (about £768 million; €898 million) and 630 million yuan (about £68.7 million; €80.4 million) respectively.

Currently, Guizhou Tyre has two phases in its Vietnam factory, with annual production capacities of “1.2 million all-steel radial tyres” and “950,000 high-performance all-steel radial tyres”. The tyre company said: “Except for the 50,000 agricultural radial tyres in the second phase that are undergoing product testing, (other production lines at the Vietnam factory) are at full production and full sales”.