WITH tyre output estimated at 861.5 million units in 2012, China is the largest producer of tyres in the world, followed by the United States and Japan, according to a study.
US-based research firm IBIS world cited in its report that China’s tyre revenue has been growing at an average annualised rate of 24.1 % to total US$79.3 billion in 2012.
There are more car ownership in the country and thereby, demand for new car tyres and replacement tyres have increased in the past five years. Road construction and growth in road transportation have also contributed to higher demand for tyres.
The report cited three tyre groups in China, which have been pulling up the industry.
The first group includes global tyre leaders: Michelin, Goodyear and Bridgestone. These firms operate in the car tyre and light truck tyre markets, especially in the OEM high-end radial car tyre segment. The second group comprises other foreign enterprises in China, such as Hankook, Kumho, GITI and some enterprises from Taiwan. They operate in the medium-class car and light truck tyre markets. The third group includes domestic enterprises. Many large-scale domestic enterprises mainly produce tyres for truck engineering and agriculture. The smaller domestic enterprises manufacture bias tyres for export.
Large-scale tyre enterprises will continue to increase production capacity, importing advanced equipment and increasing investments in advertising and specialty stores. In the OEM, enterprises will widen product ranges to meet demand from automobile manufacturers, says IBISWorld.
Meanwhile, investments in advertising and terminal sales channels in the OEM, will increase steadily due to the increasing number of brands, products and specialty stores.(RJA)
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