On November 25, 2021, Bridgestone announced that starting from December 1st, the price of the full range of TBR products (Bridgestone/Fengchitong/Zhulushi) will increase by about 3%. On the same day, the Thai chain issued a price increase notice. Affected by the cost increase and the "dual limit" factors, the domestic and foreign trade of Thai chain TBR products were simultaneously increased by 2%-3% on December 5.
On November 23, Qingdao Jianxin United Rubber also issued a price increase notice. From December 5, it will increase by 2%-3% on the basis of November 5. From tire factories to distributors, from manufacturers to end markets, the entire fourth quarter has been spent in price increases. According to incomplete statistics, the average price increase of tire factories in 2021 has exceeded 10%. What is driving tire prices to skyrocket? Who is paying for the crazy price of tires? Today, the tire business will discuss with you the "crazy" behind the price increase.
Affected by factors such as the continued increase in coal prices and the tight power supply, prices have risen sharply in the fourth quarter of 2021. Electricity prices in many provinces have risen by more than 20%, and some regions are also important producing areas for tires and related products. According to incomplete statistics, there have been more than 20 provinces where electricity prices have risen. Among them, 5 provinces have increased their prices by more than 50% during peak hours. Inner Mongolia has directly increased electricity prices by 80% on the original basis; and Shandong, an important producer of tires In November’s bilateral negotiated electricity transaction, the average transaction price was 19.8% higher than the benchmark electricity price.
However, the chain reaction caused by the increase in electricity prices has made tire companies feel unprepared-the increase in electricity prices is not a single element for tire companies, and the changes in the downstream raw material supply prices that it brings make the profits of tire companies "exacerbated." , It can even be said to be "adding snow." How big is the impact of rising electricity prices on raw material prices? Taking carbon black as an example, due to the 19.24% increase in Shanxi’s monthly bidding transactions in November and the 20% increase in Jiangsu’s benchmark electricity price, coal tar supply prices have risen significantly, coal tar auction prices in many places have exceeded 5,000 yuan, and carbon black costs have continued to rise. The sharp rise of local electricity prices in Jiangxi (60% during peak hours and 20% increase in peak hours) has increased the cost pressures of carbon black manufacturers. In early November, the domestic carbon black price has exceeded 9,000 yuan/ton, and the increase rate has exceeded 13% in the past two months.
With rising electricity prices and rising raw material prices, the production of tire companies in the fourth quarter can be described as misfortunes that never come singly! Under the pressure of production costs, tire companies can only increase prices. In the last month of the third quarter of 2021, tire companies’ price increase notifications have not stopped. Even head tire companies have issued price increase notifications more than 5 times in the past two months. Some commercial vehicle tire prices have increased. The range has exceeded 15%. However, compared with the 19.8% increase in electricity prices in Shandong and the 13% increase in carbon black prices, the only 15% increase in tire products is nothing short of a drop in the bucket.
This "butterfly effect" caused by rising electricity prices has caused tire companies to suffer from rising costs. In October, the tire business found in the industry survey that as of mid-October, the manufacturing cost of tire products has risen by at least 1 yuan per kilogram, and as time goes by, the production cost of tire companies is becoming higher and higher. With rising costs, dealers are also under pressure.
On November 26, 2021, tire dealer Yuanhong Tire issued a price increase notice-starting from December 1, its company’s tires will be adjusted for the second time, with a maximum increase of 8%. But what about market feedback? Judging from market feedback-tire manufacturers are raising prices, dealers are raising prices, and sales terminals are lowering prices.
Judging from the real feedback from the market, the “bright rise and dark fall” has been the best result. In fact, the current terminal market is experiencing one big sale after another. From the recent circle of friends of many distributors, wholesalers, and retailers, we can see that tire sales are by no means an exception. Many of these four hundred yuan tires are still top-famous brands. Although tire sales are not new, it is ironic how they look at the current environment where tire factory prices are skyrocketing.
The sharp contrast between the ex-factory price and the market price allows us to see the various helplessness and difficulties of the tire industry in 2021. New cars are on the streets, fleet attendance is reduced, and tire shops are difficult to pay. Under multiple factors, the capital chain of the tire terminal market is tight, which has caused many tire shops and even wholesalers to sell their previous inventory in large quantities even if they know the inventory of tires. Is adding value. However, facing the reality of insufficient market turnover and low return rates, tire shops have to bow their heads to reality and sell high-value tires at low prices in order to exchange funds to buy price-increasing tires.
You can say that it is a vicious circle, but in the face of market crises, these small companies relying on tires for food, besides relying on the sale of funds, what can they do? No matter how beautiful tomorrow is described, no matter how high the value of tires in the warehouse is in the future, for tire retailers, these illusory predictions are far less important than the "living money" they hold today!
Disclaimer: The picture materials and articles on this platform are from the Internet, so the copyright belongs to the original author. If you infringe your copyright and interests, please contact us. We apologize and delete it quickly. Source of the article: Tire Business
Latest news
- The Combination and Foaming Process of
- Famous tire enterprise with multiple d
- Ministry of Commerce Initiate a final
- The Effect of Carbon Black on the Cutt
- Stop work orders encounter rising pric
- Lanzhou Petrochemical's carboxylated n
Contact us
- ADD: Room 4210, CEC Business Hall, No. 121-4, Nanjing South Street, Heping District, Shenyang
- TEL: 13644907299
- FAX: 024-25361668
- E-mail: boss@long-green.cn
> Company new