In the United States, the implementation of the three-year special tire protection measure against China was terminated, and the EU Tire Label Law came into effect on November 1. China's tire industry has doubled its export pressure. However, what is more worrying is that the international tire manufacturing giant has already spotted China's vast market. Almost all of the top 10 in the world have started tire projects in China and have almost monopolized the mid- to high-end tire market.
Industry sources said that China's current tire industry still mainly occupy the low-end market, with the restructuring of export enterprises, the domestic demand for luxury car market release, the future of the domestic high-end tire market, Chinese and foreign companies will face a direct collision.
Repeated barriers "trial"
The European Union's tire labeling law was formally implemented on November 1, casting a new shadow on China's tire exports as a whole this year.
The European Union's tire labeling method is applicable to passenger car tires, light truck tires, trucks, and passenger car tires. This regulation requires that the above-mentioned tires produced after June 30, 2012 must be tagged for entry and sales to indicate the rolling resistance and rolling noise of the tires. And wet grip level. The labeling method is implemented in phases and will reduce energy consumption in Europe by 20% by 2020. According to industry forecasts, half of China's tire products may be “blocked out of the door†again due to issues such as fuel consumption, energy consumption, environmental protection, and performance.
It is understood that China's tires currently occupy the mid-to-low-end market. Due to the key technology, the performance does not meet the standards. After the US tire special security case, the industry recognized that the current tire industry in China is heavily dependent on capital, energy input, and relying on intensive The scale of labor expansion is difficult to sustain.
Through the "tire test" of the European tire labeling method, it can be seen that the productivity model is lagging behind, product technology content and added value are low, and the medium and low-end production capacity in the industry is expanding too quickly, and it is still a "chronic illness" in the Chinese tire industry.
In order to guide the healthy development of the tire industry, in 2010 the Ministry of Industry and Information Technology announced the "Tire Industry Policy", trying to promote the entire tire industry product structure adjustment, to achieve the purpose of industrial upgrading. Li Yuheng, a senior research fellow at China Investment Consulting Group, believes that compared with international companies, China’s tire companies have gaps in R&D strength, technology, and product quality. Strengthening investment in R&D, continuously upgrading technology, and introducing talents are important ways to improve the quality of tire products and shorten the gap with international companies.
It is understood that with the shrinking of overseas markets, domestic tire companies have begun to switch to the domestic market. Some domestic brands will apply the tire design and production technologies originally applied in overseas markets to domestic sales of tires, and strengthen brand building and expand marketing channels. Improve additional services and other measures to improve the product's price/performance ratio. Tire and foreign brands will intensify their competition in the mid-to-high end market.
High-end brand competition upgrade
In fact, the domestic high-end tire sector has been dominated by multinational companies. From Michelin, Goodyear, Mapai, etc. to the recent years, Hantai, Kumho and other tire brands have accelerated their development in the mid-to-high-end market and increased the proportion of medium-to-high-end car OEMs in the supporting market.
The person in charge of Goodyear China stated that Goodyear has always insisted on localization strategies to maintain its competitive advantages, including localized products, localized production, and localized talent. Goodyear invested in the Dalian Pulandian factory with the industry’s most advanced production process and the industry’s most advanced production technology.
It is understood that all of Goodyear's currently introduced products will be adjusted according to the specific conditions of the local market, and long-term road test before listing to meet the local market and consumer demand. Each product launched in China will undergo comprehensive market research and launch appropriate products based on understanding consumer needs.
In comparison, as a latecomer in the high-end segment, Hankook Tire also grew rapidly. Hantai China Marketing Strategy Minister told reporters that Hantai Tire has been implementing high-end brand strategy globally since 2008 and has made breakthroughs in supporting Audi A6L in China. With the rapid increase in domestic demand for mid-to-high-end vehicles, Hankook Tire has increased the number of UHP (Ultra High Performance Tyre) products, increased the sales performance and service level of UHP products, and introduced ultra-high performance products and environmental protection products one after another. In 2011, sales of Hankook UHP tires in China accounted for 26%.
Local companies are ready to break
Although local tire companies have begun to increase investment in the high-end, it is not easy to allocate more shares.
Industry analysts believe that some local leading companies have formed a complete independent technology research and development system is the primary competitive advantage. Products in the design, research and development and quality and other aspects have the strength of competition with the first and second-tier foreign brands, but the brand is still short-term irreparable shortcomings.
According to statistics, because high-end equipment is in the hands of developed countries, tyres used by mid-to-high-end car brands will exclude domestic tyres during the car design phase. At present, the cars produced by the joint ventures account for the mainstream of the market, and the tire companies that they are cooperating with are also internationally renowned brands. It is difficult for local tire companies to penetrate into this long-term cooperative relationship. Makes independent brand tire manufacturers have no chance of competition for a long time.
Geeser.com CEO Chen Wenkai believes that the biggest deficiency of Chinese tire brands is still the brand effect, similar to the consumption of whole vehicles. Foreign-owned tire brands are often centuries-old, but local brands are only a few decades old, which also hindered the domestic brands in supporting high-end models.
“For medium-to-high-end brands, the opportunities for domestic brands will be reflected in the replacement market.†Li Yuheng believes that due to the relatively high prices of mid-to-high-end tire brands, vehicle manufacturers face price competition pressure, and they will usually lower prices on the basis of support, leaving them to domestic tire manufacturers. Under market space.
In this regard, Ding Yuhua, chairman of the Triangle Group, said that in the context of China's tyre industry transformation and upgrade conditions are ripe for brewing, the showdown of Tituo Tuyang brand in the mid-to-high end market has started, and companies should think about transformation and upgrading and put it into practice.
Reporter observation
Tire industry consolidation is imminent
During the “12th Five-Year Plan†period, China’s tire industry changed from strong to strong. Since 2010, China’s tire industry support policies have been successively introduced, industry thresholds have gradually increased, and the merger and reorganization of the tire industry has entered an active period.
In the rapid development of China's tire industry, there are problems such as low concentration, lagging in R&D and innovation capabilities, fewer products developed by independent innovation, unreasonable product structure, relatively few high-end products, and homogeneity.
However, the cases of merger and reorganization of domestic tire companies in recent years are often the acquisition of local companies by multinational companies, and the cases of mergers and acquisitions between domestic companies rarely occur. Therefore, in the face of increasingly fierce market competition at home and abroad, whether it is the merger and reorganization between domestic tire companies, or the integration of the resources of the upper and middle reaches of the industrial chain, should be seen as a positive adjustment of domestic tire companies to respond to market changes. .
Today, with the increase in barriers to entry, the increase in rubber costs, overcapacity, and the shrinking overseas markets, the domestic tire industry has fallen into a dilemma of high sales and high profits since 2008.
It now appears that changing the profitability of the domestic tire industry requires a lot of efforts. The overall industry must not only focus on enhancing its core competitiveness, but also need to give full play to the market mechanism, guide enterprises to speed up mergers and reorganizations, encourage enterprises to reorganize across regions, and increase industrial concentration and resource allocation efficiency. This may be a "good medicine" to heal the tire industry's disorderly competition, overcapacity, and "unresolved" overseas development. [next]
Corporate voice
Goodyear:
The Chinese market is full of challenges, but it also has great potential. With the accumulation of personal wealth, China's middle class is growing at an alarming rate. They hope that the desire to own automobiles will become a feasible action, which makes the tire market full of potential. The increasing maturity of automobile consumption and the diversified development of market demand require us to provide a variety of products to meet different consumer needs.
We have a high degree of confidence in the current Chinese market and have great confidence in the development of Goodyear in China. We want to emphasize that the setting of the Goodyear product line is in line with the various needs of consumers, including high-end, mid-range, and economical. We can see that environmental protection and low carbon emissions are still the theme of current development and social growth. In addition, safety is still the core of Goodyear's products. We will continue to invest in and commit ourselves to continuous development in these areas.
â– Kumho tires:
Although the growth of the auto market has slowed in recent years, we are still optimistic about the future development and we expect the tire market to have a more optimistic performance. Right now, mid-size cars have become the main force in China's auto consumption market. Kumho Tire launched timely high-end products such as Solusk H32. These products will be the key products of Kumho Tire's sales in China.
This year is the 18th year of Kumho's entry into China. Kumho Tire’s national flagship store will be expanded to 154 stores, cover most of the provincial capitals and municipalities, and provide free tire detection, vehicle maintenance, beauty, four-wheel alignment, tire repair and professional Tire product service. At the same time, its consumer VIP protection policy goes beyond industry standards and will continue to be implemented. It mainly includes free replacement service if the tyres are worn out by nails, scratched, worn tires with no more than 50% wear within one year, and the “three-guarantee service period†is extended from three years to five years. Let consumers have no worries.
â– Hankook Tire:
The Chinese market has always been an important market for Hankook Tire. In the face of increasing demand for replacement tires brought about by the boom in the automobile market and the sharp increase in the purchasing power of luxury vehicles, high-performance tires are occupying the retail market in an irresistible position and will surely become the future. The focus of competition.
Hankook Tire has implemented high-end brand strategy globally since 2008 and has been vigorously promoting it, with the launch of the ultra-high-performance tire Ventus S1evo2 and run-flat tire Ventus S1evo. With the first phase of production of the Chongqing plant in the second half of this year and a series of high-end support and cooperation, Hankook Tire's annual sales this year will be expected to exceed the established target of 7.23 trillion won; Hankook Tire has been focusing on research and development in China for 16 years. This year will unify the image of franchise stores and improve service quality to further expand the market share of replacement tires; this year will add nearly 300 branded service franchise stores, and the total number of franchise stores will exceed 1,500.
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