Recently, the Ministry of Industry and Information Technology (MIIT) has launched a "recruitment strategy" in an attempt to establish a backward enterprise withdrawal mechanism in the automotive industry and to eliminate "zero production" and other non-compliance automobile manufacturing enterprises. This can not help but reminiscent of the domestic tire industry has a serious overcapacity, whether it can also through bankruptcy, restructuring, rational distribution and other means to promote the survival of the fittest among enterprises, optimize the industrial structure? On this issue, Tire World Network conducted an in-depth investigation and understanding of the relevant situation in Shandong, the “big first tire province.â€
Status: "No bankruptcy!"
According to several sources, the tire industry in Shandong is “a lot of confusion†and the homogenization of products is serious. When a person in the industry described the Shandong tire industry, he only said three words: many, small, and scattered.
According to conservative statistics, there are more than 500 tire companies in the country, of which there are about 300 in one province in Shandong. Although there is no shortage of domestic giants such as triangles and exquisite tires, on the other hand, small tire factories with an annual output of 500,000 or less account for about 70% of the total number of tire companies in the region.
The status quo of Shandong tire industry has a deep background. One person concluded in two sentences: On the one hand, the tire companies here are “coming in easilyâ€; on the other hand, “going out is difficult†— once the project is launched, it is often difficult to pass the market’s regulatory role, go bankrupt or collapse. In the interview, although many of the interviewees were extremely evasive and unwilling to involve too many stakeholders, they could still learn from the words of some related parties that the above two aspects have “tangled†with countless interest relationships.
"In Shandong, anyone can make tires." This is a tire company CEO had sent a feeling. This sentence also shows from the side, Shandong tire industry entry threshold is "very low."
The scale of investment in tire projects is huge. “The project of a few hundred million yuan or billions of yuan last year has great influence on the local economy. Therefore, local governments will only absorb investment unconditionally and 'prevent' it from closing down.†Chang Chunlin, deputy general manager of Evergreen Tire (Beijing) Co., Ltd., believes that the narrow interests view of local governments and the weaknesses of industrial planning are one of the reasons why today's tire companies in the region are “difficult to get out of doorsâ€.
According to another person in the industry, another major “stumbling block†for local small and medium-sized tire companies “going out†is local banks. “When the project comes in, it is necessary to make a loan, and the local government often acts as a 'guarantor' to promote investment. The government, banks, and companies then become 'a leech on a leash'.â€
The person said that once the company goes bankrupt, the government and the bank will suffer losses, so they can only “prevent†the bankruptcy or bankruptcy of the company.
In several interviews in July, the reporter did find that some of the small tire factories in the Dongying area of ​​Shandong Province have already faced closures, but informed sources revealed that most of these companies were eventually “undermined†by the local government.
As a result, actions such as “investment, production, bankruptcy, and mergers and acquisitions†that are supposed to follow the laws of the market are all due to the addition of many factors of interest and cannot be completed by the “invisible hand†of the market.
Adjustment: "M & A curtain" opened?
The "malformed" industrial structure will inevitably lead to several evil consequences. There is a serious excess of low-level production capacity, product homogeneity is extremely serious, industry is difficult to integrate and optimize, the level of research and development is low, and product quality is difficult to raise... These almost insurmountable disadvantages are exposed in the harsh environment of international economic conditions and severe trade friction. Exhausted.
However, who can play the role of “Batman†under this circumstance, use the advantages and disadvantages, optimize the industrial structure, eliminate backward production capacity, and rationalize the product structure?
In theory, these issues seem to be resolved by the industry’s competent authorities, but when asked about this issue, an authoritative person who is unwilling to disclose his name is very familiar with the relevant department. She said that the current domestic tire industry can be said to be in the "three nos." state.
According to reports, in the early days, this industry was placed under the management of the Department of Rubber of the former Ministry of Chemical Industry. After many twists and turns, only the China Rubber Industry Association could “fuse itâ€. “Industrial associations naturally do not have the kind of strength that the former Ministry of Chemical Industry managed when they were in the current year. Now the China Rubber Association plays a role that is only 'appealing and coordinating', which is too insignificant for managing an industry.†The above-mentioned person admitted frankly. Of course, the association also knows the situation of the Shandong tire industry and the importance and trend of optimizing the industrial structure, but "only slowly."
On the other hand, compared with the previous “National Development Tire Industryâ€, although some parts of Shandong are still shouting “Building a Tire Industry Cluster†slogan, their directions and contents have changed slightly. It is reported that local governments play a guiding role.
Zhang Hongmin, chairman of the Shandong Rubber Industry Association, has publicly stated that Shandong Province has stopped the approval of tire projects. Tyre World Network editors contacted each other multiple times to verify the specific situation, but the phone never answered. However, in an exchange with Zhu Baodong, tire analyst of Zhuo Chuang Information Technology, the other party confirmed that it had something to do and claimed to be “stopping the approval of all-steel tire projectsâ€.
This seems to imply that the local government has realized that the project “pulled in†before “indefinitelyâ€, resulting in the current low-end excess capacity and serious product homogeneity, and tried to avoid over-concentration of investment through the approval process. .
In addition, in addition to industry authorities and local governments, industry insiders believe that the regulatory role of the market can not be ignored.
"In the period of the 11th Five-Year Plan, Shandong once plunged all steel tires on the ground. This is the case with companies that see all steel tires making money, they are all on the steel tire project, and now they are all semi-steel tires. This is also market regulation. The role, because the semi-steel tires downstream - cars, light trucks, these industries, unlike commercial vehicles, are not affected by the macro economy, there is still demand." Zhang Chunlin said.
At present, some tire factories in Shandong have begun "actions": the big factories began to acquire, and the small factories began to collapse and were acquired."
In early July, the announcement of the Sailing Co., Ltd. said that it planned to acquire 100% of the shares of Shenyang Peace Meridian Tire Manufacturing Co., Ltd. and 49% of Shandong Jinyu Industrial Co., Ltd.
According to reports, prior to this, there were cases where domestic tire companies were acquired by multinational corporations, but there was almost no mutual acquisition among domestic companies. Therefore, there have been speculations in the industry that this move of the race will probably open up the integration and optimization of tire industry in Shandong and even China.
The achievements of the Shandong tire industry are undeniable. However, the problems behind the "big first province of tires" are as prominent as its achievements. The levees collapsed at the ants' nest, and the troubles faced by the Shandong tire industry now may sound an alarm for the tire industry investment that is still raging in other regions.
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