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CHINESE TYRES
the average market size of 10 years ago. Overall the trend is more or less even except for the blips experienced in 2008-9 and in 2012.
Over the course of the past ten years, however, the make-up of the market has changed fundamentally. ETRMA manufactured tyres have fallen from 8.5 million in 2003 to 6.5 million in 2014. This accounts for a reduction in ETRMA market share from 73% to 54% over the period. And whereas the overall market has recovered since 2012, ETRMA sales have not recovered in the way they did after the 2008-9 crisis. The recover y has come almost entirely from imports, largely, of course from China.
million tyres imported, 3.5 million were from China, and since 2012 the amount of new truck tyres coming into Europe from China has increased by 50% each year.
Meanwhile, whilst the new tyre replacement market has more or less held its own, truck retread sales have plummeted. According to ETRMA the market has reduced from 5.8 million units in 2007 to 4.7 million in 2014. The market did see a temporary recovery in 2010-11, but overall, the retread market is moving in only one direction.
Whilst this is going on in Europe, there are signs that other parts of the world are mobilising themselves to protect their own tyre and retreading industries
from the International Trade Commission (ITC), which points to an increase of more than 650,000 tyres imported in the first nine months of 2015 compared to the same period in 2014. In January the US based trade journal Modern Tire Dealer estimated US truck tyre imports from China for 2015 to be 9.4 million units, up 14.6% from the previous year.
Meanwhile, in December 2015 the Russian-led Eurasia Economic Union applied protective duty on tyres imported from China as part of a dumping investigation that had been taking place since March of last year. According to the data of the investigation, in the period from 2011-14 the
Chinese imports and due to the prohibitive cost of casings have left the market, or significantly cut production capacities.”
But as one door closes, another opens up. In this month’s magazine our interview with the chairman of the Malaysian Retreaders Association TRMAM outlines the difficulties currently being faced by retreaders in that market. With Malaysia’s position as a net exporter of rubber to consider, the imposition of tariffs to protect the local tyre industry would prove problematical to say the least.
Another country set to feel the brunt of Chinese tyre imports is Turkey, where an anti-dumping regulation currently in force is set
The make-up of imported tyres has changed significantly since 2007, when there was also a very high number of truck tyres imported into Europe – 6.13 million units, in fact – more than the 5.8 million imported in 2014. However, the origin of these tyres in 2007 was split fairly evenly with 1.3 million units coming from Japan and only 1.5 million from China. By 2014, of the 5.8
against what they perceive to be unfair competition from China. In January the United Steelworkers (USW) union in the USA, which represents workers at truck and bus tyre plants in the US operated by Bridgestone and Goodyear, filed a petition asking the US government to impose anti-dumping duties on truck and bus tyres manufactured in China. In it, the USW cites import data
truck tyre market in Russia rose by 9.2%, while Chinese
brands increased their presence by 27.1%. During this period the price of their products
was approximately half that of their main Russian
competitors. The dumping of Chinese tyres cut profits tenfold within the economy tyre and retread segments, and hurt tyre business within the countr y.
The protective duties (between 14.79% - 35.35% depending on the manufacturer) have been welcomed by the retreading industr y in Russia, but some consider that the moved by the Eurasia Economic Commission has come too late. One Russian retreader commented; “Most market participants currently face problems with the rising of the currency component in the casings, which are mostly imported, so restrictions on Chinese tyres would be very helpful, but this measure should have been taken at least a year ago, when retreading companies were in a better position. During 2015, most of them have been facing heavy competition with
to be lifted in June this year. The Turkish retreading industry is currently waiting with bated breath to see the impact of this. The key problem facing Europe is the EU’s traditional stance in favour of free trade. At a time when major markets in other parts of the world are protecting themselves with high import duties, such as Brazil and the USA, tariffs for importing tyres into Europe still remain low. Chinese tyre manufacturers currently pay 4.5% import duty if they want to export tyres to the EU. European manufacturers, on the other hand, wanting to sell into China have to pay 10% duty on car tyres, between 3 and 10% on truck tyres and 15% on motorcycle tyres. For agricultural tyres the tariff can be as high as 25% - so in most cases the Chinese manufacturers are being helped not only by their own governments, but by the European government as well! Now we all hope that the likes of BIPAVER and national bodies like the Syndicat des Professionnels du Pneu (SPP) in France, the RMA in the UK, and many other
20 Retreading Business