Special security case transfer machine tire industry restructuring is imminent

The extraordinary 2009 has passed, but the worst result may be in 2010. Experts in the industry suggest that in 2010, the Chinese tire industry will face even greater challenges. The sharp drop in exports, the collapse of bankruptcies, the consolidation of the industry, the shift in business direction, and the search for new exports are all huge challenges facing them.

Yesterday, Fan Rende, Secretary-General of the China Rubber Association, told reporters that 2010 will be the "tyre special security case" for China's tire industry, the most serious damage to the year, and the world's tires and other rubber products market did not significantly warm up, but also increased China's rubber industry The difficulty of running this year may be the most difficult year for the development of China's rubber industry since the beginning of the new century.

Special Security Case

On January 19, the World Trade Organization Panel of Experts on China's Tire Special Protection Case was established to investigate the high tariffs levied by the United States on Chinese tires.

The survey will focus on a three-year high tariff imposed on Chinese tires by President Barack Obama last September. Among them, the tariff for the first year is as high as 35%, which is much higher than the 4% normally collected in the past. Obama's move is aimed at slowing the growth rate of Chinese tire exports to the United States and protecting the US tire industry.

In response to this, Mei Xinyu, an expert from China’s Ministry of Commerce’s Institute of Trade Studies, told the Shanghai Securities News that the investigation of the expert group is of little significance and is only a routine procedure. When the investigation results are introduced, it also depends on the United States. "If you want to wrestle repeatedly, you can toss for two years."

Experts familiar with the WTO's laws directly believe that the survey results have little chance of being beneficial to China, and the possibility of the Chinese getting a turnaround is very slim.

Obviously, the special case of tire protection has become an important turning point for Chinese tire companies entering the winter from the midsummer.

In the investigation of this reporter, Yu Xiaoming, the general manager of Shandong Yongtai Rubber Co., Ltd., reported that as of now, the company’s US orders have fallen drastically, and basically the profit margin is very low and very small. Sun Shumin, director of the International Market Service Department of Shandong Triangle Tire Co., Ltd., said that after the special security case, the export volume of the United States tires from Triangle Tire Company has dropped from more than 300,000 pieces to more than 100,000 pieces each month.

Hu Guoliang, research and development director of the China Group Electronic Brake Systems Division, told reporters that since the United States implemented special protection for Chinese tires , it was the people of China and the United States who really suffered harm. “Many tire production workers in China are unemployed; while families with low-end income in the United States face the increase in tire prices in China, they have to choose to change their tires once every two years instead of replacing them once a year as before. Their driving safety is also not achieved. Guarantee."

In fact, under the economic crisis, the US market is no longer "safe." Fan Rende, secretary-general of the China Rubber Association, told reporters that the United States, which has led the world in consumption for decades, is changing the situation of large imports. The United States was originally the world’s first car production and sales country, and now its automobile output has continuously declined, and car consumption has decreased significantly. In the past few years, more than one-third of our tires were exported to the United States. It seems that the way to rely too much on exporting to the United States has failed. Exports to the European Union and other countries will also be difficult.

According to statistics, China currently ranks first in the world in terms of output of 500 million sets of tires over the United States, with an annual export volume of 250 million to 300 million sets. The weakening of auto demand in developed countries in Europe and America caused by the financial crisis directly led to sluggish demand in the tire market. In fact, orders received by Chinese companies since the first half of last year have been significantly reduced.

To make things worse, the United States waved "anti-dumping sticks" and triggered an international knock-on effect. As of January 20, the number of countries including India and Argentina that carried out special security investigations on Chinese tires exceeded 10. China's tire export market is facing the most severe situation in history.

Industry structure adjustment is imminent

After the United States to China tires special security case, the pace of adjustment of China's tire industry has already had to speed up.

First of all, the development of China's rubber industry is facing adjustments, transformations, and restructuring to promote China's rubber industry to emerge from adversity and develop steadily and healthily. Fan Rende, secretary-general of the China Rubber Association, pointed out that “adjustment of the structure of growth mode and product mix will increase the proportion of energy-saving and environmental-friendly rubber products, and at the same time increase the adjustment of market structure: from single market adjustment to market diversification. The new market places emphasis on the needs of the rural market.”

Second, the integration of the tire industry is expected to begin. According to Zhao Wenquan, director of the Technical and Economic Committee of the China Association for Economic Cooperation and Technology, the conditions for entry into the tire industry have been completed and are awaiting approval from the Ministry of Industry and Information Technology. "Since we started to formulate industrial revitalization plans in March of last year, the Ministry of Industry and Information Technology has repeatedly referred to the issue of access, and clearly stated that it is necessary to formulate conditions for the entry of the tire industry. It was originally hoped that it would be introduced before the end of 2009."

He pointed out that according to incomplete statistics, there are more than 400 enterprises above designated size in the domestic tire industry. Although China is a big country in tire production, it is by no means a strong country for tire production. Apart from the fact that the total output is dominant in the world, the grade and quality of Chinese tires The production scale of the company is far from that of the United States, Japan, South Korea and other tire countries.

CITIC Securities analyst Li Shengmao also pointed out that domestic tire production and technical standards are relatively backward, the industry is dominated by SMEs, more scattered, causing disorderly market competition, blindly lower prices, is not conducive to fight with foreign tire giants. Chinese tire companies should take the path of group development, and large companies should merge small outdated or bankrupt companies to improve the overall level of tire companies.

According to industry insiders' advice, while the country is inviting investment to expand domestic tire production, it must also impose restrictions on small enterprises. These enterprises blindly produce and duplicate construction, and the risk of excess capacity in the tire industry has intensified. “Blindly repeated construction, such as taking all steel radial tires in one area, will directly lead to an even more unbalanced market.” According to statistics, in 2008, China’s tire production reached 350 million, of which 260 million radial tires. Article, radialization rate of 75%. The industry concentration is low, the homogeneity of products is serious, and there are few high value-added products, and the benefits are affected.

In this regard, the Rubber Industry Association Deng Yaxi believes that the global financial crisis has made the tire industry more clearly see its own problems. Only by properly formulating industry access conditions and industrial adjustment opinions and plans can the tire industry be able to ensure healthy and stable development.

View related topics: China and the United States tire special security case

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