In 2015, the economic operation of China’s tire industry was in the downward trend, both the production and export volume and price of the tire fell, and the change in compounded rubber standard and the U.S. “double anti” attacked from both sides; meanwhile, the industry also had hundreds of high lights, accelerating “going out”, industry transformation and upgrading and enhancing the commercial value of the tire enjoyed popular support, and the industry proceeded in hardship.

Although the prices of basic raw materials such as rubber kept low, the tire price continuously declined, which had completed offset the favors brought about by the fall in prices of raw materials. “Three highs” and “three lows” showed in the tire industry: high inventory, high risk and high degree of homogenization; low price, low profit and low rate of operation. Various economic indicators of 40 member enterprises according to the statistics of Tire Branch had an overall decline.

Table 1:  Analysis of Main Economic Indicators of 40 Tire Enterprises from January to November, 2015

Seen from the average rate of operation of the industry that of all-steel radial tires is below 65% while that of semi-steel radial tires is below 67%, thus the situation was extremely severe.

According to the statistics by the Customs, in 2015, the total export volume of automobile tires had a year-on-year (the same below) decrease of 4.12%, in which, the export volume of passenger car tires had a decrease of 8.6% while that of truck and bus tires had a decrease of 1.5%. The export volume of passenger car tires exported to the U.S. market was 313700 tons, with a decrease of 42.7%; the export volume of truck and bus tires was 589800 tons, with a decrease of 10.2%, with a total export reduction of 300700 tons.

The export dependence of Chinese tire products was over 40%, the cost advantages were gradually disappearing, and the tire industry of the developing countries developed quickly, which also caused severe pressure for China’s tire industry. Under the conditions where the global economic situation kept continuously low, the trade barriers and frictions showed a growth trend.

Table 2:  Changes in Economic Benefit Data of Statistics Tire Enterprises from January to November, 2015

Among the statistics enterprises, as for 31 domestic-funded enterprises, 7 had a deficit, with the deficit value of 585 Million Yuan; as for 9 overseas-funded enterprises, 2 had a deficit, with the deficit value of 116 Million Yuan; and the scale of losses reached 22.5%.

According to incomplete statistics, in the whole industry, 6 enterprises (factories) shut down and went into liquidation due to reasons such as elimination of outdated capacity, environmental protection removal, capital chain rupture, etc., and 9 enterprises stopped the construction of tire projects due to capital, environmental impact assessment and land problems.