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.
In order to support China’s anti-coronavirus epidemic actions, the Sailun Group has donated 10 million yuan to the Qingdao Red Cross for emergency assistance and to help mitigate the spread of the virus. Of the 10 million yuan donation, 4 million yuan came from the group’s management team and employees.
The coronavirus clearly presents a human tragedy, but it is also affecting international economies and manufacturing in particular. Following our coverage of the impact on the tyre business, various market analysts have been assessing the impact on the automotive industry.
The short story is that internal OE demand is likely to be much harder hit than external exports. According to NBC, China could suffer the loss of 1 million vehicles worth of production due to the suspension of production for at least an extra week in the so-called “motor city” of Wuhan, which is located at the epicentre of the coronavirus outbreak and has a population of 11 million people.
Goodyear Tire & Rubber has responded to the coronavirus outbreak in China by temporarily closing its headquarters in Shanghai and the Goodyear Dalian Tire co. Ltd. manufacturing facility in Pulandian (Liaoning Province). Both facilities are expected to remain closed until at least Sunday.
As of 5 February 2020, the World Health Organization (WHO) reports that there have been 24,554 confirmed cases of coronavirus across 25 countries since the outbreak began on 23 January 2020. Governments all round the world are taking steps to contain the spread of the virus as well as to develop treatment, but China is bearing the brunt of it with 24,363 cases within its borders alone. As a result, the transport systems of at least 10 cities in the People’s Republic have been shut down and public gatherings are being discouraged. As a result, home-working rates have shot through the roof and there has been an inevitable impact on the manufacturing industry. Considering China is the world’s largest manufacturer of tyres by unit volume, what impact is the coronavirus having on the tyre industry?
On 23 January 2020, Pirelli & C. S.p.A. received a notification letter from its largest shareholder, China National Chemical Corporation Ltd. (ChemChina), informing the firm that it is undergoing “strategic restructuring”. The restructuring notice covered both ChemChina and Sinochem Group Co., Ltd.
Positive experiences with original equipment tyres play an important role when it comes to choosing replacement tyres, and leading tyre makers therefore strive to gain approvals with OEMs. Linglong Tire recently scored a coup when FAW Group chose its tyres for what’s arguably China’s most expensive car, the Hongqi L5.
On 6 January 2020, Cabot China Limited, a wholly owned subsidiary of Cabot Corporation agreed to buy Shenzhen Sanshun Nano New Materials Co., Ltd, a leading carbon nanotube (CNT) producer in China. The $115 million pricetag reportedly includes “liabilities and contingent payments”. According to the company, the move is designed to strengthen Cabot’s position in the high-growth batteries market, particularly in China, which is the largest and fastest growing electric vehicle market in the world.
A ceremony was held on 11 January to officially inaugurate car tyre production at the Hubei Linglong Tire Co., Ltd. facility in Jingmen, China. The event was held in the same location where TBR tyre production was commissioned in December and was attended by nearly 600 guests.
Following the announcement that Mercedes-Benz and Zhejiang Geely Holding Group have formally established the global joint venture (JV) ‘smart Automobile Co., Ltd’ for the Smart brand after receiving the necessary regulatory approvals, David Leggett, Automotive Editor at GlobalData, a leading data and analytics company, offers his view:
A court in China has ruled in Bridgestone Corporation’s favour in a design right infringement lawsuit against tyre makers Shandong Huasheng Rubber Co., Ltd. (Huasheng) and Shandong Hongsheng Rubber Co., Ltd. (Hongsheng).
Guizhou Tire recently broke ground on two new tyre production facilities near the firm’s headquarters in Guizhou, Guiyang province. According to Asian Rubber Journal reports, when operational, the first – a $307 million plant – is expected to generate nearly $426 million annually. Capacity is salted to be 3 million truck tyres a year.
Linglong Tire has begun making car tyres at its newest factory in China. These first Linglong Crosswind 4×4 HP tyres from the Hubei Linglong Tire Co. Ltd. car tyre plant in Jingmen were produced on 30 December, five weeks after the production of truck and bus radial tyres commenced. Company employees and local dignitaries were on hand to witness the occasion.
Linglong Tire has entered into a cooperative agreement with Chinese car-making joint venture company SGMW. The new partnership commenced with the signing of a strategic cooperation framework agreement at SGMW’s headquarters on 30 December. Under the agreement, the two parties will collaborate on product design, development, application, quality assurance, cost optimisation and manufacturing over a long-term basis.
On 21 December, Linglong Tire signed a tripartite strategic agreement with Tencent Cloud and Shenzhen Huazhi Technology Group. The tyre maker hopes that this deal, signed by the three parties at Tencent’s global headquarters, will help it build a “global industrial service platform and intelligent retail platform.”
Michelin’s North American operation has filed a suit against a company importing “counterfeit” tyres from China. The tyres in question are said to violate patents for the BFGoodrich All-Terrain T/A KO2.
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