Chinese tire industry sees negative growth in investments, profits in 2016

Statistics showed Chinese rubber and tire industries stopped falling and tended to stabilize in 2016, according to an official with China Rubber Industry Association.

China’s rubber industryshifted from negative growth in sales revenues to profit growth in 2016, getting rid of the slumping situation in 2015, said Deng Yali, chairman of China Rubber Industry Association, at the annual industry forum of 2017.

China had 3,968 large and midsize enterprises in the rubber and tire industries in 2016, which obtained overall revenues of 1,034.469 billion yuan in the main business, up 2.61 percent from 2015.

The total export value stood at 44.35 billion U.S. dollars in 2016, down 8.11 percent on year. The total profits grew 5.89 percent on year to 64.739 billion yuan.

However, total investments in the tire industry reduced 2.38 percent on year to 58.693 billion yuan in 2016, marking the third consecutive annual decline.

What’s also worth noting is that the profits of tire, cycle tire and rubber overshoe sectors have recorded negative growth for two years in a row.

According to statistics from China Rubber Industry Association, China saw higher growth in the sales revenues of tire, rubber goods, rubber overshoes, latex, rubber machinery molds and rubber chemicals in 2016 than in 2015.

Sectors of cycle tire, rubber hose and rubber tape, carbon black and waste rubber utilization recorded smaller decline in sales revenues in 2016 than in 2015.

The entire carbon black industry shifted from losses to profits in 2016. The industries of tire and cycle tire both saw smaller declines in profits in 2016. Rubber overshoe and waste rubber utilization industries both recorded lower profit growth in 2016 than in 2015.

The rest all embraced higher profit growth in 2016.

Deng said the growth of tire output was close to that of automobile output last year.

The recovering domestic demand has boosted development of the tire industry indirectly.

Also, the prices of rubber goods went up against the background of production capacity structure adjustment, product upgrading, brand promotion and higher raw material prices.

Deng expected Chinese demand for tires to grow more slowly or even to shrink in 2017, considering the slowdown of automobile industry and high cardinal numbers last year.