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CRI-report: Research Report of Chinese Tire Industry, 2012
In 2011, the sales revenue of Chinese tire manufacturing enterprises exceeded CNY 400 billion. In recent years, China encounters severe inflation and the prices of tires' raw materials keep rising.
In 2011, the sales revenue of Chinese tire manufacturing enterprises exceeded CNY 400 billion. In recent years, China encounters severe inflation and the prices of tires' raw materials keep rising. Moreover, the rising procurement cost of raw materials of Chinese tire manufacturers results from the adjustment of Chinese monetary policy as well as the frequent occurrence of natural disasters in Southeast Asia which makes the demand of natural rubbers exceed supply. In 2011, the sales revenue of China's tires was mainly increased by the rising price of rubbers and the increasing share of high-grade tires.
International tire giants have begun to successively enter China since the 1990s. Attracted by Chinese low production cost, multinational tire enterprises mostly regard China as one of their important production bases around the world. Such advantages as huge market demand and low cost in China greatly appeal to tire investments from the world. Currently, over a half of Chinese tire market has been occupied by foreign-funded enterprises. Besides, foreign-funded enterprises firmly dominate Chinese high-end market, and their profit rate is generally twice or even much higher than that of Chinese domestic enterprises.
In China, international tire giants possess huge advantages, while most domestic enterprises are in small scale with less strength. According to incomplete statistics of China research and Intelligence, by the end of 2011, there were over 500 Chinese tire manufacturing enterprises. In the next 3 to 5 years, Chinese tire industry is predicted to accelerate the speed of M&A, and many small and medium-sized enterprises will fade away, i.e. these enterprises will either be acquired by advantageous enterprises or go bankrupt.
In 2009, Chinese tire export amount dropped by 4.7% YOY, while in 2010 Chinese tire export amount rose by 35.2% YOY, reaching USD 10.388 billion. In 2011, Chinese tire export amount even increased by more than 40% YOY, reaching USD 14.762 billion. The tire export of China has basically overcome the influence of “Special Protection Case”.
In 2011, under the conditions of the exports increasing and price of natural rubbers falling, the profit of Chinese tire enterprises slightly improved.
Though China has become the world's largest new automobile market since 2009, the number of automobile ownership per capita in China is still small. In 2011, the automobile reserve number of per 1,000 people in China was less than 80, lagging far behind the level of 600-800 per 1,000 people in developed countries. It is estimated that Chinese automobile market will maintain the annual growth rate of over 10% in the next few years, and the annual growth rate of Chinese tire market will exceed 15% with the increasing Chinese automobile reserves. In Chinese automobile tire market, demand for replacement tires is about twice that for supporting tires in the maintenance market, accounting for over 2/3 of the entire tire market.
As China has basically possessed complete upstream and downstream of the tire industry chain and relatively cheap energy and low price of labor force, Chinese tire industry still owns huge advantages compared with some other developing countries in recent years, and sees a gradual growth in export and domestic demand in the next few years.
The annual output of China's tires accounts for about 1/4 of the world's total. China has become the largest manufacturer, exporter, and consumer country of tire industry in global. The homogenization of China's tire industry is severe, i.e., simply seeking the growth of quantities and coping production capacity which cause the low technological and value-added products, as well as the fast expansion of medium and low-end production capacity. So enterprises have to seize market by means of price reduction, which leads to the intensified market competition and the vicious circle of the industry. The export of Chinese tire is facing increasing trade barriers, and the way of low costs has come to an end. Aiming to maintain long-term and stable development, Chinese tire industry must change its development pattern, i.e. transferring from export-oriented pattern to domestic demand-led pattern.
To get more details, please go to http://www.cri-
Through this report, more following information can be acquired:
-Development Course of Chinese Tire Industry
-Development Environment of Chinese Tire Industry
-Supply and Demand of Chinese Tire Industry
-Competition of Chinese Tire Industry
-Analysis on Major Multinational Enterprises and Localized Enterprises in Chinese Tire Industry
-Exit Barriers for Chinese Tire industry
-M&A in Chinese Tire Industry
-Development Trend of Tire Industry
-Investment Opportunities of Chinese Tire Industry
Following people are recommended to buy this report:
-Upstream Rubber, Carbon Black and Steel Cord Enterprises
-Tire Importers and Exporters
-Investors and Research Institutions Concerned About Tire Industry
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China Research and Intelligence is a market research company based in Shanghai, China. More information can be viewed on website: http://www.cri-