China Tire Industry Aims at High End Market

www.chinatrucks.com : The tire industry of China is experiencing surplus production and homogeneous competition. The rubber industry of China is expected to grow steadily this year, with the total output at ￥950 billion, a rise of 10-15%. 490 million tires are forecast to be produced, a rise of 4%. China has developed to be the largest manufacturer, exporter and consumer of rubber products. However, the industry is filled with too many similar makers and products, which on one hand intensifies the competition, on the other hand, squeezes the profit of all makers.

The reduction of price of rubber will benefit the development of the rubber industry. The net profit of rubber industry is expected to increase accordingly.

The high end market is the future of the industry. Because the tire industry lacks say in the determination of prices, so, it is pressed by both the downstream and upstream industries. Only by entering the high end market, could the industry develop better. As policies carried out in the EU against the benefits of Chinese rubber industry, accompanied by the anti-dumping investigation carried out by the USA, Brazil, Thailand, Columbia, Mexico and many more, the industry has been forced to develop upward.

We recommend that: firstly, tire makers shall keep on with innovation, develop more new products, improve product quality, try to build a internationally famous brand. Secondly, they should pay more attention to the changes taking place in the rubber market, and establish a stability fund and mechanism to absorb the pressure of the market. Thirdly, they should push forward the restructuring of the industry, and initiate the transition of the industry from labor-oriented to technology-oriented.

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