Tire Industry in Shandong Sees Greatest Drop in Over A Decade

The overall situation of tire industry in Shandong province has been declining.

Drop in Output and Profit

Shandong is China’s largest province in terms of tire production with its output accounting for more than a half of China’s total.

Statistics released by the Statistical Bureau of Shandong Province show that in 2015, the province’s tire output was 413 million, down 3.95% from 2014.

Data from Shandong Rubber Industry Association shows that there were 37 radial tire producers in the province last year, four fewer than in 2014; their radial tire output was 259 million, down 8.06% from 2014, accounting for 50.28% of China’s radial tire total.

Among them, there were 31 all-steel radial tire producers with tire output of 60.74 million, down 11.01%, accounting for 55.21% of China’s all-steel radial tire output.

The number of semi-steel tire producers in Shandong was 28 with tire output of 198 million, down 7.2%, accounting for 48.9% of China’s semi-steel radial tire output.

Shandong’s output of all-steel engineering radial tires was 252,500 in 2015, roughly on par with the output in 2014.

In 2015, twenty-nine enterprises in the Chinese mainland were involved in the world’s top 75 tire companies, including 17 in Shandong province, accounting for 58.6% of the number of Chinese tire producers in the list.

Tire Exports Drop in Volume and Value

Besides declines in output and profit, the exports in Shandong were sluggish.

In 2015, Shandong exported 192 million tires, down 7.8% from 2014; the value of export delivery was 7.34 billion US dollars, down 17.1% year on year, accounting for 53.2% of China’s total tire export value.

Zhang Hongmin, head of Shandong Rubber Industry Association, said the decrement was the greatest in more than a decade.

Among the top tire exporters in Shandong, the exports of Linglong Group were 989 million dollars; those of Triangle Group, 966 million dollars; Hengfeng Group, 837 million dollars; Hixih Rubber Industry Group, 469 million dollars; Sailun Jinyu Group, 432 million dollars; and Nexen Tire, 401 million dollars.

In addition, the exports of Xingyuan Group were 381 million dollars; Shandong Jinyu Tire, 377 million dollars; Prinx Chengshan (Shandong) Tire, 353 million dollars; Shandong Haohua Tire, 349 million dollars; Shandong Sentury Tire, 327 million dollars; and Doublestar Group, 326 million dollars.

However, only three of those exporters saw their exports grow, they were Shandong Haohua Tire with the exports rising 62.5%, Hengfeng Group with a 28.9% growth, and Shandong Sentury Tire with a 3.6% growth.

In view of Zhang, the situation of tire industry in Shandong will be more serious in 2016 when the U.S. launched anti-dumping and anti-subsidy probe against tires from China, domestic demand slowed down, and the country implemented the de-capacity policy.