Analysis of China's tire industry demand, export situation and market structure in 2019.
'Guanyan Tianxia' released the "2019 China Tyre Market Analysis Report-Industry In-depth Research and Development Prospect Evaluation" shows that since 2019, the impact of China's trade conflicts on restricting exports and the continued weakening of domestic downstream automobile demand have resulted in Cargo pressure has increased. At the same time, as domestic tire raw material prices are still in a relatively bottom area, domestic semi-steel and all-steel tire prices will continue to decline in 2019. According to forecast analysis, exports and demand are unlikely to improve significantly in the short term, and natural rubber prices continue to be low.
China's tire exports
Looking at the downstream tire market, China's auto sales will decline rapidly in 2019, and domestic demand will continue to weaken. According to statistics from China Association of Automobile Manufacturers, as of June 2019, China's cumulative sales of 12.323 million vehicles, a year-on-year decrease of 12%.
China's car sales
General tire raw material structure
Natural rubber was affected by increasing supply and weakening demand, keeping prices low. Synthetic rubber is affected by the linkage of natural rubber prices and overcapacity, and prices continue to fall. After carbon black enters 2019, it will be affected by overcapacity and the price will enter the downward channel. In general, the current price of tyre raw materials has been steadily declining, tire costs have been reduced, and the gross profit margin of tyre companies is expected to improve.
Price trend of tire raw materials (yuan / ton)
Benefiting from the decline in the price of raw materials, although the demand for tires is relatively low and the price of products has remained relatively low, the profit center of tire companies can still maintain an upward trend, and their profitability has gradually increased.
Tire gross profit center (yuan / strip)
In terms of market structure, around 2010, relying on the advantages of raw materials, cheap labor, and loose currency and high leverage, a large number of Chinese tire companies expanded rapidly. With extremely low prices and acceptable products, they exported to overseas low-end markets in large quantities. Market share increased rapidly. China's tire output has ranked first in the world for ten consecutive years. A complete tire industry system with complete specifications and a complete series has been formed, and its global influence has increased significantly. It is expected that the high-speed development trend of the Chinese tire market will continue in the future.
From 2000 to 2016, the sales and global share of Chinese tire companies have gradually increased
In terms of concentration, since 2017, the sharp rise and fall in raw material prices have exacerbated corporate funding problems, and factors such as stricter environmental protection supervision and industrial structure upgrade have accelerated industry integration.
Trend of China's tire industry concentration
In recent years, the increase in the penetration rate of domestic domestic brand tires is very obvious. It is expected that in the future, with the combined promotion of brand effects and technological advancement, the trend of domestic tire industry upgrading and upward penetration will continue. According to forecast analysis, by 2020, the penetration rate of passenger car tire supporting market is expected to increase to 30%, the replacement market is expected to increase to more than 50%, and domestic high-quality companies are expected to gain market expansion.
China's Independent Brand Penetration in China's Overall Market
The penetration rate of China's independent brands in the passenger car tire market
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