Now one of the largest tyre-producing countries in the world, China has an indisputable influence on the direction of global tyre trade. The home of both fast-growing up-and-coming brands as well as a burgeoning domestic market, this tag chronicles China’s involvement with the tyre business.
Imports of truck and bus tyres into India have risen sharply since may in spite of government restrictions. The Automotive Tyre Manufacturers Association (ATMA) reports 138,347 truck and bus tyres entered the country in August, up from 20,222 units in April. The majority of these were produced in China, the organisation adds – imports from China reached 100,772 units in August, a dramatic increase on the 9,594 tyres imported in April.
Cooper Tire & Rubber had a busy week at SEMA, revealing plans for a series of new tyres for some of its associate lines and talking up its green tyre success. Cooper officials said that sales of its first green line, the Cooper GFE, have been outstanding, and dealer and consumer feedback have been positive. The tyre was introduced earlier this year.
Toyo Tire & Rubber remained in the red during the first half of the current financial year, recording a net loss of 1,976 million yen (£13.24 million). Sales during the six months to September 30 dropped 25.0 per cent year-on-year to 129,609 million yen (£868.25 million), and operating loss amounted to 1,300 million yen (£8.71 million), compared with an operating income of 1,177 million yen in the first half of the 2008 financial year. The company’s tyre business unit generated 74.0 per cent of the company’s entire sales and posted a first-half net turnover of 96,001 million yen (£643.11 million) – a 21.6 per cent decrease from a year earlier.
The Cooper Kenda Tire joint venture factory in Kunshan, China has become the fourth Cooper Tire & Rubber facility to gain ISO 9001 certification. The plant’s ISO 9001:2008 quality management system certification follows last year’s certification of Cooper’s three US manufacturing facilities, Findlay, Ohio, Texarkana, Arkansas, and Tupelo, Mississippi.
News from the SEMA show in the US indicates that South Korea’s Daewoo International wishes to bring its own home brand tyres to market. The company has developed its own tread patterns and owns the moulds and plates used in production, however the tyres will reportedly be manufactured in China by several manufacturers, including Triangle Tyre. The company is looking to distribute the range internationally.
This year Automechanika Shanghai takes place between December 9 and 11 at the Shanghai New International Expo Centre, China. Despite the global recession, organiser Messe Frankfurt reports the show has already set a new record with over 2,200 exhibitors from 23 countries and regions, including Belgium, Brazil, China, France, Germany, Hong Kong, India, Indonesia, Italy, Japan, Korea, Malaysia, the Netherlands, Russia, Saudi Arabia, Serbia, Singapore, Spain, Taiwan, Thailand, Turkey, UK and USA. As a result, the exhibition space has expanded to nine halls, with a total of more than 100,000 square metres.
China is the world’s largest consumer of rubber, and growth in the use of compound rubber – a substance containing 99 per cent natural rubber but attracting 15 per cent less tax than its pure 100 per cent counterpart – is colossal. This year the country is expected to import 950,000 tons of compound rubber, a leap of almost 71 per cent from last year. Many rubber exporters in Thailand, Indonesia and Malaysia are now focusing on producing compound rubber more to take advantage of China's import duty structure. "Compound rubber import volume was increasing in recent years because the customs tax was lower than [for] natural rubber," the China Rubber Research Institute said in a report prepared for an international conference in Vietnam.
Bridgestone reports that its operating environment “remained challenging” in the first three quarters of the 2009 fiscal year. The nine months to September 30, it comments, was a time of “weakened consumer spending and declines in private sector capital investment, which counteracted signs of recovery among some exports.” The continuation of recession conditions in Europe and the United States was tempered by some sectors showing signs of stabilisation, however, and a gradual recovery was seen in China. Other regions also began to show slight signs of recovery, the tyre major states.
An innovation on the day of the NTDA's recent Annual Dinner was a "Question Time"-style seminar, in which a panel drawn from all sectors of the tyre industry answered questions from the floor. Here’s our synopsis of questions, answers and comments from the delegates. The event was sponsored by the Tyre Industry Federation and it attracted an audience of more than 30. TIF chairman Peter Gaster chaired the panel and the other members were: Alan Baldwin, Micheldever Tyre Services; Mark Brickhill, Goodyear Dunlop Tyres; Derek McMartin, Maxxis UK; Patrick O'Connell, Bandvulc Group; Noel Pope, Merityre Specialists and Tim Stott, Sapphire Energy Recovery. Thus, between them, the panel covered all segments of the tyre business, from manufacturing and importing tyres, to wholesaling, retailing, retreading and scrap tyre disposal. Here's a summary of what was said:
Sales of cars in China increased more than 84 per cent in September, and for the first time passed the one million unit mark. In order to meet increasing demand from for automotive parts, Mitsui Chemicals and China Petroleum & Chemical (Sinopec), Asia’s largest oil refiner, plan to spend 60 billion yen (£406 million) to build two chemical factories in Shanghai. One of the plants will produce the synthetic rubber EPT, which is widely utilised in vehicle components.
JK Tyre and Industries is aiming to substantially increase exports from Tornel, the Mexican company it acquired last year. According to the Press Trust of India the company aims to do this within a year through further expand within the Central and South American markets.
China Securities Journal has reported that China will soon issue new tyre industry policies aimed at raising the threshold for new plants and reducing the proportion of exports. The move follows the recent US decision to impose 35 per cent import duties on Chinese-made tyres.
Pierre Cohade, president of Goodyear Tire & Rubber Co.’s Asia-Pacific business, recently asked if we should move away from talking about BRIC countries (the emerging markets of Brazil, Russia, India and China) and instead focus on BIIC. Posting this poser on the popular Twitter social network (follow twitter.com/tyrepress for regular tyre industry updates) from his base in Shanghai, Cohade questioned whether Russia’s position as leading light in the global economy should be replaced with Indonesia which, in his words “continues its spectacular improvements.” He’s got a point.
Several media sources are now reporting that last year’s ruling by the US Department of Commerce that slapped often huge antidumping duties on certain OTR and farm tyres imported from China will get another look. On September 18, the US Court of International Trade ordered the Commerce Department to review its ruling and the countervailing duties it applied to a host of tires imported from China. The court said the Commerce Department’s duty calculations were in error, and in cases were effectively double what they should have been. The court gave the Commerce Department 90 days to clear up the duty discrepancies. Tyres & Accessories/tyrepress.com first reported this story on 25 September, but following the collapse of GPX International last week US-based Tire Review draws a parallel between the two stories.
Yokohama Rubber has announced its decision to “beef up” the fourth phase expansion of its Hangzhou Yokohama Tire Co., Ltd. tyre production facility in order to increase production capacity from current 3 million to 5.1 million passenger car tyres a year. Planned investment in the phase four expansion as a whole is approximately seven billion yen, and production in the expanded facility is scheduled to begin in January 2011.
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