Out Now!China’s Tire Industry

2015-2018

http://ChinaTireReport.com

Report Title: China’s Tire Industry 2015-2018

Length: 200 pages / 250 tables, charts & diagrams

Price: Single licence: GBP 2950 / € 3950 / US$ 4950

Publisher: Tire Industry Research

Find out more: http://ChinaTireReport.com

T I Res

Your unique insight into China’s Tire Industry

Learn about

❖ Tubeless truck tires ❖ Truck tire size changes ❖ Rim sizes and profitability ❖ Segmentation and profitability ❖ Government policies ❖ Legislation ❖ Land prices and their influence ❖ Case studies on Linglong and Triangle ❖ Company profiles ❖ Tire factories in China ❖ Expansion plans ❖ Capacity ❖ Operating rates

Probably the biggest question in the global tire industry today is this: How quickly will China move to high-tech tires?

Currently there are only a very limited number of tire makers in China who make anything but low-tech, low added-value tires. If and when the majority of the hundreds of tire makers in the region move toward silica treads, low mass and other high technology, that will have implications both for global tire markets and upstream suppliers.

The latest report from Tire Industry Research (TIRes) attempts to give comprehensive answers to that question. Unfortunately, there is no simple answer.

The most simplistic answer is that the Chinese government and its quasi-governmental agency the China Rubber Industry Association (CRIA) want the transition to happen as quickly as possible – in the next three to five years.

They are putting in place legislation to make it happen; top management at State-controlled companies are being told to make it happen. Banks are being instructed to make capital available only to tire makers who want to make it happen.

A new strategy document from the CRIA outlines in 800

pages how the industry will develop until 2025. That document, published in October 2014 predicts annual growth rates of 7% until 2020 and 6% annually until 2025. It also addresses energy conservation; water usage; reducing reliance on fossil-fuel-derived materials; bio-sourcing of monomers and other aspects of the industry.

The new TIRes report argues that it will be a lot more than 5 years before the bulk of China’s tire makers have switched to high-tech designs; silica-silane treads and advanced reinforcement systems.

Putting a time-scale on that transition is impossible. It will depend on a series of individual decisions by powerful men who run some of the largest tire makers in China. China’s tire industry is about individuals and their relationships with other individuals.

http://ChinaTireReport.comChina’s Tire Industry 2015-2018Tire Industry Research

China’s Tire Industry 2015-2018 Tire Industry Researchhttp://ChinaTireReport.com

Contents*Executive Summary

Key take-aways:

Cooper and ApolloMarketing in ChinaTargetting good business partners in ChinaMarketing function

International companiesTruck tire segmentHow soon will China move to high-tech tires?

IntroductionKey take-aways: Chapter 01China in the tire worldChina’s tire industry.

Truck and bus marketsLegislation

Truck tire marketsRetreads are low-qualityCultural differences

LegislationGovernment policies

Production and exportsIndustry competition

China Tire industryKey take-aways: Chapter 02China’s tire industryCurrent industry structure.

The main players:Price weakness in China

International tire makersMarketing databases become criticalLeveraging Price-Mix

Domestic tire makersOver-Capacity

Land pricesInventories and stocks

Mergers and AcquisitionsWorking conditionsWorkers earningsStandards + brandingProduction quality

Tread pattern databaseNew marketsRetreadingExports

What tire makers sayKey take-aways: Chapter 03Nexen (Korean tire maker)German tire wholesalerTech King)Aeolus

What do Chinese management think of you?

YuelongTOEE Haida Tyre)Shengtai TireDongying-based tire makerHangzhou ZhongceGiTi operations in Europe

Winning OE contractsBrand promotionOn line sales

Winrun (Tire trader in Guangzhou)

Vehicle marketsCar markets

Time-series developmentSUV, MPV shares

Truck markets

LegislationKey take-aways: Chapter 05Tax and legislation

Tire Industry PolicyLimits on energy, water

Environmental standards:Energy, water limits

Specific Energy useSpecific water use

EnforcementKumho suffers

Testing and complianceBias-play and capacityTire Industry Policy (2010)Green Tire Specification XXZB/LT-102-2014Tire Industry Access Condi-tions (2014)

Trade TariffsKey take-aways: Chapter 06Why tariffs?

Low manufacturing costsBrazil targets car, truck tiresImpact will be significant

CRIA appears to welcome tariffs

Not just the United StatesIndia taxes China-made tiresEgyptian measures tooArgentina lifts tariffs on TBR, PCR tiresColumbia sets minimum pricesKazakhstan, Belarus, Russia to investigate

RecyclingKey take-aways: Chapter 07Introduction.

Environmental hazard.Rubber recycling:

LegislationFinancial supportCapability

Rubber recycling industry.Shandong province.Applications.Research developmentsSecond hand tires

Companies:Fuquan Rubber (Laiwu City, Shandong Province)

Case study - LinglongLingong case study

Consolidated incomeTechnology

Case study – TriangleEmployee count and profileMain Business Overview

2003 – 20082009 – present

R&DManufacturing advantagesCompetitive disadvantagesProduction flexibilitySales model and sales channelsMarketing – domesticMarketing – International

Raw materials analysisEnvironmental analysisMachinery analysisR&D projectsR&D spending

Quality CertificationRemunerationFull Financial analysis:Inventory analysis

Development goals.Profitability AnalysisSensitivity analyses

Specific energy useEquipment inventoryNew truck tire factory

Company profilesAeolus

Company OverviewHistoryRevenue AnalysisTyre FactoriesCorporate StrategyBrand ReputationStrengthsThreatsTechnology And InnovationCSR Achievements

Cheng Shin Tire Co.HistoryFactoryRevenue AnalysisStrategyBrand ReceptionMaxxis As A SupplierInnovationsSponsorships

Double Coin.Company OverviewHistoryRevenue AnalysisTyre FactoriesCorporate StrategyBrand ReputationStrengthsTechnology And InnovationHistoryRevenues AnalysisFactoryCorporate StrategyBrand ReputationR&D And InnovationProfileDouble Happiness

GiTi Tire CorpHistory

Revenue AnalysisFactoriesCorporate StrategyBrand Reputation GITI Quality InspectionCSR Activities

Guizhou Tire Corp.ProfileFINANCIALSOutlook

Hangzhou ZhongceCompany OverviewHistoryRevenue AnalysisCorporate StrategyBrand ReputationStrengthsThreatsFactory

Jiangsu GST Profile

Kenda RubberHistoryRevenue AnalysisFactoriesStrategyR&DTriple-Helix Projects undertaken by KendaBrand ReputationKenda’s Awards

(Shandong) LingLongCompany OverviewHistoryRevenue AnalysisFactoriesCorporate StrategyR&D InitiativesBrand ReputationStrengthsCSR Activities

Shandong Wanda BOTOProfileSummary:

Nankang Rubber Tire Co ProfileRevenueCSR ActivitiesAwardsCertifications

SailunHistoryR&DFactoryRevenue AnalysisCorporate StrategyBrand ReputationCertifications achieved by Sailun

Sentaida (Qingdao Sentury)TestingManufacturingNew Factory in Thailand

Shandong Hengfeng Profile

Shandong Jinyu GroupProfile

Shengtai GroupProfile

South China TireProfileR&DStrategy & BrandCertifications Awards & Recognition

TOEE Haida TyreProfileFinancial AnalysisCertifications & AwardsSubsidiaries

Triangle GroupCompany OverviewHistoryRevenue AnalysisFactoryCorporate StrategyBrand ReputationInnovationR&D InitiativesCSR

Xingyuan Group LtdHistoryFactoryCorporate StrategyBrand ReputationStrengthsR&D And Innovation

Short profiles of tire makersBeijing Capital TireChaoyang Long March

DurattiGuilin TireHua WuJixing TireLuntal (Luntai A)Pearl River TireQingdao Yellow Sea:Shaanxi YanchangShandong BayiShandong Fengyuan Tire manufacturing company:Shandong Leling Weigel Rubber Co-Shandong Hawk Shandong Yinbao – Shenhua – ITRShenyang Peace Radial Tire Co. Tianjin United Tire & RubberYongSheng group(Zhengxing) WuYiZhejiang Cotan Tyre Co

Other tire makers

Business in China: practicalities

Key take-aways: Chapter 11Chinese history

ConfuciusSilk RoadGreat Age of DiscoveryWestern attacksOpium WarsJapanese atrocitiesPost-War period

Working practices in ChinaComments from companies

Chinese businessman:Western engineer:Western businessmanWestern businessman:Chinese businessman:Chinese businessmanChinese businessman

Leadership and marketing

*Contents accurate at 01 Jan 2015. The publisher may change the report content as developments permit.

Who benefits from the reportThis report is of key interest to those in the tire industry supply chain, both as buyers from tire makers and sellers into tire manufacture.

Supply Chain Professionals will benefit by learning about latest developments in this key market.

Tire makers in the developed world and those in China and other developing countries will learn how the industry is developing and the steps needed to better understand the Chinese and international markets.

Corporate management in premium tire makers will appreciate the in-depth yet broad-based overview of the industry — analysing strategies, distribution, pricing and segmentation.

Tire buyers and chassis engineers in vehicle makers and tire distribution will learn the key drivers in China and how to spot good potential partners.

The report provides up-to-date information about legislation, capacity, expansion plans and Government Policies.

Suppliers to the tire industry will learn about the development of domestic players and their international rivals.

Doing business in China is not straightforward. This report gives insight about how to approach business deals with Chinese partners in China and elsewhere.

Author David Shaw’s expertise has allowed him to meet with thought leaders around the world and bring their wisdom to a global audience.

http://ChinaTireReport.comTire Industry Research

Charts and diagramsChapter 01: Introduction

Map of China with ProvincesTire production in China 2013Tire production worldwide 2013-2020Car tire demand worldwide 2010-2035Car tire demand (All) worldwide 2015Car tire demand (RE) worldwide 2015Car tire demand (OE) worldwide 2015Truck tire demand (All) 2015Truck tire demand (Repl.) 2015Truck tire demand (OE) 2015World’s top tire makers

China’s top tire makersPassenger car tire prices in China – v – GermanyCosts at top tire makersNR price development 2012-2015China Passenger car tire prices 2011-2014Fragmentation in China’s tire manufacturing sectorCar, truck Tire production in China 2013Market shares of International tire companies in China – Car tiresTire size development in China 2009-2018Regional concentration of tire production

China Tire industry situationTire production in China 2004-2015Global brands car tire capacity in China 2013-2019

Light tire manufacturing capacity in China 2013Heavy tire price development in China 2011-2014Light tire price development in China 2011-2014Light tire price development in UK 2011-2014Light tire prices in China depends on rim sizePrice and rim diameter compared: China, GermanyEuropean tire makers in China: financial dataTBR tire makers in China 2014 – exports and outputCar tire makers in China 2014 – exports and outputRadialisation rate in China 2004 – 2013Car tire demand in China 2008 – 2016

What tire makers sayChina tire makers add limited value

Vehicle markets

Car parc in China 2008 – 2016Vehicle sales in China 1995 – 2016Monthly car registrations in China 2005 – 2014SUV, MPV dominate vehicle growth in car segmentTruck sales in China 2005 – 2014Car ownership by Province

LegislationSpecific Energy use targets are challengingSpecific Energy use by companyEnvironmental footprint of a tire-1Environmental footprint of a tire-2Specific Water use targets are also challenging

Trade TariffsExport exposure - China car tire makers

China’s Tire Industry 2015-2018Tire Industry Research http://ChinaTireReport.com

China’s Tire Industry 2015-2018 Tire Industry Researchhttp://ChinaTireReport.com

Tables and info boxesChapter 01: Introduction

State-owned and private enterprisesChina radial tire production forecastMain laws affecting China Tire sectorMinimum capacity limits according to Tire Industry Policy ( 轮胎产业政策 )China tire demand-2015Tire industry profitabilityCompany sales marginsChina vehicle demand 2015Approx tire demand in China

Chapter 02: China Tire industry situation

Top 10 car / Light truck tire makers in China by capacity (2014)

Analysing price and rim diameterCooper-Chengshan summary

Top 10 truck tire makers in China by capacity (2014)Global brands tire capacity in ChinaSelected China tire factories – capacity and productsTire factories in China (with 2-digit DoT codes)

Chapter 03: What tire makers sayCooper’s Asian Tech centre gears up for OE contractsPremium manufacturer sees good organic growth

Online tire retailers in China

Chapter 04: Vehicle marketsVehicle sales in China 2013-2014Tires per vehicle – ChinaLuxury car brands in China 2013China: top 100 best-selling sedans/ hatchbacks/ coupés in the first half of 2014China: Top 50 best-selling SUVs in the first half of 2014China vehicle forecastsChina: Top 20 best-selling MPVs in the first half of 2014

Chapter 05: LegislationRole of the China Rubber Industries Association (CRIA)

Main policies affecting China Tire sectorStandards applicable to tire manufacture in ChinaOther China tire Standards (some in development)Access Conditions

China Rubber Industry Development Strategy for 2016 – 2025《中国橡胶工业强国发展战略研究》

China radial tire production forecastKey Performance Indicators -Tire IndustryTruck tire targets for 2020Productivity of tire workers in ChinaTruck tire targets for 2025Passenger car tire targets for 2020CRIA ranking policy for tire makersPassenger car tire targets for 2025

Aims:Specific articles of the Tire Industry PolicyAims:

DefinitionsSupplementary definitionsApplicabilityRelated Standards:Threshold values for Grip, noise, RROrganisations contributing to draft:

Threshold Value for Green Tire Rolling Resistance GB/T 29042Threshold Value for Passenger Car Radial Tire Wet Grip Performance

Threshold Value for Mini and Light Duty Vehicle Tire Wet Grip PerformanceThreshold Value for Heavy Duty Vehicle Tire Wet Grip PerformanceProscribed raw materialsRaw materials which should not be used in China-made tiresRaw materials which should be limited in China-made tiresRaw materials which should be used in China-made tiresTechnical and Administrative Parameters for Green Tire Clean ProductionTechnical and Administrative Parameters for Green Tire Clean Production

1. Energy and Resources Consumption requirements2. Product Index for Technical Features3. Comprehensive Resources Utilisation Index4. Contaminant Index5. Process and Equipment Requirement6. Clean Production Administration

Aims:ApplicabilityOverviewSummary:Manufacturing technologyEnergy and resource consumptionEnvironmental protectionSafety and occupational healthTest track in Dongying City

Chapter 06: Trade TariffsAnti-Dumping measures brought against the China Tire Industry

A history of US trade tariffs: 2009 – 2012A history of US trade tariffs: 2013-2015Initial Preliminary countervailing duties on specific manufacturers - 24 Nov 2014Revised countervailing duties (revised data in bold) - 22 Dec 2014

Brazil sunset review timetableCar tire exports from China by company

Chapter 07: recyclingAccess conditions for scrap tire utilisation industry

Chapter 08 – case study – Linglong:Linglong financial data 2011-2013Linglong financial summary 2011-2013China tire makers – gross profit margin comparisonLinglong capacity utilisationLinglong profitability by tire categoryLinglong revenues per tire categoryLinglong profitability per tire categoryLinglong cost price development – truck tiresLinglong Cost price development – car tiresLinglong Cost price development – bias tires

Linglong tire production by tire categoryLinglong sales by replacement and OE sectorLinglong: Main customers 2011-2013Linglong: domestic and overseas salesLinglong: export sales by countryChina tire makers: profitability comparisonLinglong: revenue per tire by tire categoryLinglong: costs of raw materials by materialEvolution of raw materials costs at LinglongEvolution of energy costs at LinglongLinglong: specific energy consumptionLinglong: operating costs development 2011-2013Linglong: Top suppliers 2011-2013Linglong: Carbon Black consumption by gradeLinglong: inventory costs 2011-2013Linglong: Inventory costs of finished products by categoryChina Tire makers – Comparison of inventory costsLinglong: employee breakdown by specialityLinglong: employee breakdown by AgeLinglong R&D expenses 2011-2013Linglong: employee breakdown by qualificationLinglong: R&D priority projectsLinglong: R&D projects with third party partnersLinglong: Machinery inventory

Chapter 09: Case study – TriangleTriangle consolidated income statementTriangle consolidated cash flow statementTriangle: Key financial indicatorsTriangle: financial performance - key figuresTriangle: Staff employment and qualificationsTriangle employment development 2011-2013Triangle: major capacity investment projectsTriangle revenues by product streamRevenue by product categoryTriangle: Average price of productsTriangle revenues by domestic and export salesTriangle: revenues by OE and replacement channelsTriangle Production and capacity by product streamTriangle main export countries by revenueTriangle: main domestic customersTriangle: main export customersTriangle: top OE customersTriangle: top 5 customersTriangle: main suppliersTriangle: raw materials costsTriangle: raw material price evolutionTriangle: Environmental protection spendTriangle: fixed assets overviewTriangle: production machinery equipment listTriangle Internal research projectsTriangle: external cooperative research projectsTriangle: R&D spendingTriangle: operational standards in manufacturingTriangle: biggest customerTriangle: Remuneration of senior staffTriangle consolidated balance sheetTriangle consolidated income statementTriangle consolidated cash flow statementTriangle: company balance sheetTriangle: parent company income statementTriangle Cash Flow StatementTriangle: Inventory costs (as at 31 Dec 2013)Triangle: Costs of ongoing construction work

Triangle: Main government grantsTriangle inventory costs:China Tire makers – Accounts receivable com-parisonChina Tire Makers: Inventory Turnover Analysis:Triangle: profitability analysisChina Tire Makers – Profitability comparisonTriangle: profitability by segmentTriangle revenues by domestic and export salesTriangle China sales revenues by regionTriangle: main export regions by revenueTriangle sales by brandTriangle: Off-take & Private brand customersTriangle: Operating costs summaryTriangle operating costs – detailedTriangle: profitability by segmentTriangle: profitability by domestic and export marketsChina Tire companies – Gross margin comparisonTriangle: gross margin analysis – TBRTriangle: TBR Cost-revenue analysis by domestic & export marketsTriangle: TBR Cost-revenue analysis by Off-take & own brandTriangle: PCR Gross margin analysisTriangle: PCR Cost-revenue analysis by domestic & export marketsTriangle: PCR Cost-revenue analysis by Off-take & own brandTriangle: PCR Cost-revenue analysis by Off-take & own brandTriangle: Bias tire Gross margin analysisTriangle: Bias tire Cost-revenue analysis by domes-tic & export marketsTriangle: Bias tire Cost-revenue analysis by Off-take & own brandTriangle: Bias tires Cost-revenue analysis by Off-take & own brandsTriangle: sensitivity analysis selling price changesTriangle: sensitivity analysis raw materials price changesChina Tire companies – Key financial data comparisonTriangle: costs summaryTriangle: Administration costs summaryTriangle: Income tax expenseTriangle: other expensesBias – v – radial performance comparisonTriangle: domestically-sourced equipment listTriangle: Overseas-sourced equipment listTriangle: TBR factory project costsTriangle: cost-benefit analysis of new truck tire factoryTriangle: car tire project costsTriangle car tire project – imported equipmentTriangle car tire plant – List of buildingsTriangle: cost-benefit analysis of new Car tire factory

http://ChinaTireReport.comTire Industry Research

$0 mill

$5000 mill

$10000 mill

$15000 mill

$20000 mill

$25000 mill

$30000 mill

$35000 mill

ChinaBridgestone

Hangzhou Zhongce Rubber $4529m

GITI Tire $3756m

Triangle Group $2712m

Shandong Linglong Rubber $1884m

Double Coin Holdings $1800m

Xingyuan Tyre $1557m

Aeolus Tyre $1408m

Qingdao Doublestar Industrial $878mShandong Deruibo $992m

Shandong Jinyu Tyre Co. $1139m

Shandong Hengfeng Tyre Co. $1580m

Sailun Co. Ltd. $996mGuizhou Tyre Co. Ltd. $1068m

Shandong Shengtai Tyre Co. $1090mJiangsu Tongyong Tire Ltd. $874mShandong Wanda Tyre Co. $781m

South China Tire & Rubber Co. $574mShandong Hengyu. $623m

Shanxi Suanxi Tyre Co. Ltd. $571mShandong Sangong Tyre Co. Ltd. $461mXuzhou Xugong Tyre Co. $394mSichuan Haida Tyre Group Co. $366mChaoyang Long March Tyre Co. $316m

Xinjiang Kunlun Tire Co. $244m Qingdao Sentury Tire Co $287m

Shandong TaiShan $211m

Beijing Shouchuang Tire Co. $201m

Tianjin United Tire & Rubber Co. (TUTRIC) $112mHaoyou Tire co $120m

Shandong Bayi $201m

$31,725m

$27,390m

Fragmentation in China’s Tire industry

Other

Sales/Mktg

R&D

Depreciation

Capex

Labour

Other Ingredients

Fabric

Chemicals

Fillers

SR

NR

China

India

Developed

Cost structure of tire manufacturers by region

0 20 40 60 80 100

Domestic brands/export

Domestic brands/ domestic sales

International brands

TBR

PCR/LT 158m units

12m units

88m units

35m units

132m units

2013 total:377m units

2013 total:100m units

53m units

Tire production in China by manufacturer

Others

PCR production capacity in China by company

Sample chartsA wide range of charts, tables and information boxes help describe the state of the market and its development over time.

GB29449-2012

Tire type Maximum energy per ton tires*

GJ/ton tire

All-steel radial ≤495 ≤14.5Semi-steel radial ≤530 ≤15.53Bias tire ≤645 ≤18.9OTR ≤900 ≤26.4

* Energy is measured as kg coal equiva-lent per ton of tires; International conver-sion says 1 kg coal equivalent = 29.3 MJ

China’s Tire Industry 2015-2018Tire Industry Research http://ChinaTireReport.com

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China Tire Industry 2015-2018

MethodologyThis report has been researched and written by David Shaw, recognised industry expert.

He has spent the last year talking to industry leaders and participants about China’s Tire Industry. He has presented to three conference in China in 2014 and met with dozens of executives, workers and government officials in Shandong, Shanghai and also in Europe and other parts of Asia.

This report leverages Shaw’s vast experience with the latest market data and insight into the world’s biggest producer of tires.

Every day Shaw tracked the top Chinese and international information sources for new information, data and insight.

Who should buy this reportAnyone responsible for strategic planning in the tire industry and its extended supply chain needs to read this report.

It sets out the strengths and weaknesses of the domestic tire makers and their international rivals in the car segment, the truck segment and identifies emerging opportunities in the tire sector.

The key advantage of this report is the depth in which Shaw tackles every branch of the China tire business, from market shares to sales and distribution and upstream to the technology used in factories.

A detailed analysis of top tire makers is included in the report, as well as listings of factories and data on segmentation and growth opportunities in SUV, Winter and other key segments .

Order FormTo order, contact us directly or complete the order form belowMailing address: Tire Industry Research, 34 Marchmont Rd, Wallington, Surrey SM6 9NU United KingdomOr complete the online order form at http://ChinaTire Report.comFor more information call Izabella or David at Tire Industry Research on +44 208 647 1185or email David@TireIndustryResearch.com