The situation is worrying. What should China's tire industry do?
since the fourth quarter of last year, the operating environment and operating conditions of China's tire industry have declined rapidly. According to the statistics of 46 member units by the tire branch of China Rubber Industry Association, the tire production in October 2014 decreased by as much as 17%, which was the first year-on-year decline in the year, and the decline was huge. The tire industry has maintained a high inventory this year. After entering October 2014, some enterprises chose to close or stop production of some production lines, which is also the reason for the sharp decline in production. The statistics of tire branch in November 2014 showed that the tire inventory of member enterprises was 19.7 billion yuan, an increase of 18.32% year-on-year
with high inventory, low product prices, low operating rate and tight funds, most tire enterprises feel very sad. Combined with the current internal and external environment of the tire industry, this situation is expected to continue for a long time. What are the reasons for this situation and what will the tire industry do? The author understands and analyzes the current situation, and industry experts also put forward their opinions on it
the market is depressed and the operating rate is declining.
some tire enterprises, almost every empty space is full of tires. Under normal circumstances, the inventory of tire enterprises is about one month's output, but this year, the inventory of tire enterprises is mostly maintained for more than two months. Choosing high inventory is the business strategy of tire enterprises from the beginning of the year. It is believed that by the second half of the transportation season, tire sales will become prosperous, and some inventory will be digested. However, in the second half of this year, tire sales did not turn prosperous, but even more depressed. Faced with rows of inventory tires, the boss of a tire enterprise in Guangrao, Shandong shook his head and said, "I didn't expect that the tire sales in the second half of this year were bad, and the enterprise could only significantly reduce production." Many tire enterprises in Guangrao, Shandong shut down many production lines, and the output of Shandong Yongsheng Rubber Group Co., Ltd. fell by more than 1/3; Shandong Huasheng Rubber Co., Ltd. closed a workshop, reducing more than 200 employees; All steel tire projects of phase III project of Fangxing Rubber Co., Ltd. were suspended. This phenomenon is spreading across the country, and the operating rate of some large enterprises is also declining. At present, the operating rate of good tire enterprises is 80%, and that of most enterprises is about 60%
tire enterprises, especially Shandong tire enterprises, cannot see the follow-up situation clearly, and generally suspend project investment. Especially after October 2014, some tire enterprises changed from "not clear" to "not optimistic", and some tire factories changed from "project suspension" to "project cancellation". For example, Shandong Haoyu Tire Co., Ltd. resold the project equipment located in Yinan county to Shandong aokailong Rubber Technology Co., Ltd., and Shandong Heng rubber and Plastic Co., Ltd. located in Dawang Town, Guangrao County canceled the Guangrao Dingzhuang town project. Zhongce, shuangqian and others are adjusting their investment strategies, saying they will re plan the layout of tires in the future. Affected by the suspension of tire investment in early 2014, more than 10 projects in Shandong Province were suspended at that time. Recently, the project supervision has been loosened, and several enterprise tire projects have been approved by the competent investment department of Shandong Province. There are very few bidding projects for tire equipment, mainly including Ningxia Dadi Recycling Development Co., Ltd., Jilin Jixing Tire Co., Ltd., Hebei Yifeng Tire Co., Ltd
three mountains oppress the tire market
in this way The main reason for the current situation of the tire industry is the serious structural surplus of the tire industry. Deng Yali, President of China Rubber Industry Association, believes that the structural surplus of tires in China is positive. Specifically, there is a serious surplus of low-end homogeneous tires, but there is still much room for the development of high-end and green tires
according to the data of China Rubber Industry Association, the cumulative output of all steel tires and semi steel tires in China in 2013 was 107million and 369million respectively. However, according to the calculation of the rubber machinery professional committee from the equipment ordering situation, by the end of 2014, the production capacity of China's all steel tires had reached more than 165million, and the production capacity of semi steel tires had reached more than 600million. Although there is a large gap between actual production capacity and demand, there is no doubt about the overall surplus of tires. Overcapacity leads to fierce competition and disorder. Tire enterprises prefer price to market, resulting in a sharp decline in tire prices. In 2014, China's tire prices "fell endlessly", and the semi steel tire price index fell from 86.05 in January to 74.5 in December, a decrease of 13.42%; The price index of all steel tyres fell from 77.74 at the beginning of the year to 67.98 in December, a decrease of 12.56%. The profit margin of tire enterprises fell sharply. Among the 44 tire branch enterprises that counted the profits in October, 7 were loss making enterprises, with a loss of 419.9 million yuan and a loss of 15.91%
the second reason is that export trade frictions are getting worse, which hinders China's tire exports. China's tires are highly dependent on foreign countries, and the export volume of tires accounts for about 40% of China's total tire output. Once the export is not good, the life of China's tire industry will be difficult. In the second half of 2014, the United States conducted a "double anti" investigation on China's passenger and light truck tires. The "countervailing" tax rate has been announced, and the general enterprise tax rate is 12.03%. Coupled with the "anti-dumping" tax rate to be announced on January 21, China's tire enterprises can't afford such a high "double anti" tax rate, and the export of passenger and light truck tires to the U.S. market is basically blocked. In September 2014, the Eurasian Economic Commission filed an anti-dumping investigation on China's truck tyres. If the tire export is blocked and abnormal conditions occur, immediate protection will make the structural surplus of the tire market more serious, and the competition among tire enterprises will intensify, which is not conducive to the healthy and stable development of the tire industry
the third reason is that the composite rubber standard and the natural rubber tariff adjustment affect the tire production and increase the manufacturing cost of enterprises. On December 31, 2014, with continuous honeycomb structure of heat insulation, the national standard of general technical specification for composite rubber was officially released, and the glue content of composite rubber was adjusted to be less than 88%; From January 1 this year, the national cellar will further raise the specific tariff of natural rubber. Shenjinrong, the chairman of Hangzhou Zhongce, believes that the increase of composite rubber standards and natural rubber tariffs is a huge and fatal blow to China's tire enterprises. In the face of such fierce competition in the global tire market, on the one hand, China's tire enterprises must face the endless overseas trade barriers, on the other hand, they must face the sharp cost pressure of domestic imported natural rubber, which will further push up the manufacturing cost of China's tires and reduce the competitiveness of China's tires in the world. After the adjustment of composite rubber standard, Chinese tire enterprises will be required to find new composite rubber or substitutes suitable for their own useChu Zhengyu, chairman of the tire branch, said that the above three factors are like three mountains pressing on the tire industry, and the tire market is filled with anxiety. Not only the inventory of enterprises is increasing, but also the inventory of dealers is expanding. The capital chain of the whole industry is very tight, the price war has become white hot, and the business risk is further increasing
transformation and innovation is the way out
Chu Zhengyu suggested that China's tire industry should innovate thinking and promote the transformation and upgrading of the industry. First, emphasize brand building, improve product reputation rather than reduce prices. In order to remove other materials attached to the surface of waste plastics, tire enterprises should pay attention to the changes in consumer behavior, change the single way of price reduction and promotion, and improve the reputation of products through brand building and high-quality services. Second, standardize the market order and realize orderly competition. The tire industry should consciously control the tire production capacity, keep the supply and demand relatively stable, help dealers speed up shipment, stabilize market sentiment, boost market confidence, and promote the standardized operation of the whole market. Third, strengthen technology research and development, market-oriented rather than product oriented. Domestic tire enterprises should recognize the situation, strengthen technology research and development, take the market as the guide, gradually accumulate, generate and improve core technologies, and realize the transformation to "green" production as soon as possible. Fourth, strengthen the innovation of marketing mode, adapt to the trend rather than resist the trend. Qualified enterprises in the industry should explore and establish a suitable e-commerce model
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