Tire producers in Guangrao county start to reshuffle

Although the tire industry is recognized as a promising industry by the public, capital shortage is a urgent issue to be solved by most tire producers.

Someone predicts that tire producers to be able to survive the industrial reshuffle should meet the conditions of “4+2”.

4 means the top four tire leaders in the county, namely Shandong Hengfeng Rubber & Plastic Co., Ltd., Shandong Jinyu Industrial Co., Ltd., Xingyuan Group, and Shandong Huasheng Rubber Co., Ltd.

“Rich” is the first impression of the four tire producers by local people.

Besides them, a special tire producer and a large original tire manufacturer are also believed to be able to survive.

According to an executive of a tire enterprise, the integration of the tire industry will be completed by the end of 2018.

Strategic cooperation is a necessary path for the tire producers.

Dongying municipal government issued in Mar. 2107 the Implementation Plan of Dongying for Made in China 2025, stipulating the merger, acquisition and capacity integration among tire producers to increase tire industry’s concentration.

An industry expert said it will be proper for tire producers in Guangrao to complete merger and acquisition in 7-8 years.

But since the beginning of this year, environmental protection and production safety, as well as broken capital chain in Guangrao may accelerate the progress of strategic cooperation.

A large local tire producer has spent tens of million yuan in dealing with VOCs emission.

It is quite a fortune for cash-strapped tire producers.

In addition, Shandong province initiated a half-year emergent action to eliminate security risks, which also put pressure on local tire producers.

The industry expert said as long as the producers are able to survive in the coming 2-3 years, they will make it for good.

Therefore, the upcoming three years could be a crucial period for tire industrial reshuffle in Guangrao.