Sequela of surging tire prices coming up

“Although Chinese tire makers has won the appeal against the U.S. anti-dumping and anti-subsidy rulings, they should not get too excited,” a veteran in the tire export business told tireworld.com.cn.

Smaller price advantages

Chinese tire production capacities are surplus and the export market is under fierce competition. The status quo will not change for the recent winning in the U.S., the veteran said.

Recently, tire prices have surged sharply in China. The much higher tire prices have reduced the price advantage of tires made in China.

The export prices of Chinese tires are getting close to the those of the second tier international brands, a market insider told media.

Actually, Chinese exporters took the surging prices of Chinese tires as an important argument in the hearing in the U.S.

Much higher raw material costs

Quite a few tire makers in China are at the edge of making losses because of the surging raw material prices.

Although the tire prices have been lifted for several times, the growth of raw material prices are even bigger.

In about two months, prices of raw materials rose from 80 percent to 200 percent, an insider from a tire factory said.

“Due to the higher costs, tires makers have to lift the tire prices. If the prices are raised too much, our sales go down. If too little, we face losses,” a senior manager with a tire manufacturer in Shandong province told tireworld.com.cn.

It is expected the tire prices will go up further in the near future.

Some tire factories have planned to raise prices further in March and April, including a few leading tire brands in China.

“The winning in the U.S. provides a good opportunity for Chinese tire industry,” said a market watcher. “It’s time for Chinese manufacturers to compete with brand and quality.”