Thanks to various factors such as geographical location and market demand, Shandong's tire industry has been continuously growing since the 1950s. At the same time, due to its "barbaric growth" development mode, many Chinese people have the impression of Shandong tires as "low quality, cheap, and poor service".
But in fact, a few years ago, the Shandong government also realized this problem and introduced multiple policies to help the healthy development of the Shandong tire industry. In addition, the Shandong tire industry itself has also developed into a clustered stage, and with the government's urging and market's self repair, Shandong tires are no longer what they were before.
Why should we have a new understanding of Shandong Tire?
1. Multiple enterprises have the ability to produce high-quality tires
At present, many Shandong tire companies have already established their own brand matrix. At the Guangrao Tire Exhibition from May 15th to 17th, multiple tire companies participated with their flagship products, and some tire companies released new products at the exhibition.
For example, Sailun Group has made stunning appearances with its multiple liquid gold tire new products: Yongsheng Rubber has made multiple tire brand products such as "Yongsheng", "Le Tai Le", and "Ji Xiang" at the exhibition. The Rotalla Setula S-Race EV01 tire on display recently won the International 2023iF Design Award: Double Star launched the "black technology" of the tire industry - the "booster wheel".
2. 80% of Shandong tires are exported overseas, favored by European and American countries
According to the press conference on the results of the Dongying Municipal Government's Guangrao Exhibition on May 17th, the contract amount for this year's conference exceeded 21.9 billion yuan, an increase of 9.7% compared to last year. Among them, the tire brand overseas promotion activity - the Russian special event achieved more than 330 one-on-one docking between China and foreign countries, with an intention amount of 2.3 billion yuan.
It is a public fact that European and American people like to use Chinese tires on the tire rims. A survey once showed that 50% of people in the UK use Chinese tires.
3. Advanced factories reshape the image of Shandong tires
Starting from around 2018, Shandong tire companies have launched 4.0 intelligent factories, which are more efficient and require less labor compared to traditional factories. More than ten tire companies, including Sailun, Linglong, Triangle, Huasheng, Shuangxing, Pulin Chengshan, Senqilin, Yongsheng, Jinyu, Zaoming Rubber, are reshaping the image of Shandong tires with high-quality, high-tech, and advanced factories.
4. Accelerated elimination of outdated production capacity and increased government support
In recent years, Shandong has placed "cleaning up outdated production capacity" as a top priority and has issued multiple policies. For example, the "14th Five Year Plan for Building a Strong Manufacturing Province in Shandong Province", the "Three Resolutions" Action Plan for the Implementation of the Province (2021-2022) ", the" Two High "Project Management Catalog in Shandong Province (2022 Edition)", and the "2022 Work Plan for Shandong Province to Use Comprehensive Standards to Promote the Exit of Backward Production Capacity in accordance with Laws and Regulations".
At the same time, Shandong Province, a major tire manufacturing province, is also guiding advantageous tire enterprises to become bigger and stronger. According to the "14th Five Year Plan for Building a Strong Manufacturing Province in Shandong Province", the planned output value of the tire industry in Shandong Province will reach 200 billion yuan by 2025; There are 8 tire companies with sales revenue exceeding 10 billion yuan, among which 2 or more companies with sales revenue exceeding 20 billion yuan, and 1-2 companies have entered the top 10 in the global tire industry. The "Development Plan for the Rubber Tire Industry in Dongying City (2023-2025) (Draft for Public Consultation)" also stated that it will cultivate 3-5 global leading tire enterprises with operating revenue of over 65 billion yuan; Support the merger and integration of backbone enterprises, accelerate the pace of enterprise listing, including supporting Shuoyuan New Materials, Jinyu Tire, Huasheng Rubber, Hengfeng Rubber, Xingyuan Tire, Yongsheng Rubber, etc.
5. International brands seeking Shandong tire companies as proxy factories
About 10 years ago, most of Shandong's tires were mainly OEM products, processing for first tier brands, and the "tire capital" became known as the "tire factory" in the eyes of the outside world. Nowadays, Shandong tires have abandoned "OEM enterprises" and started to build independent brands.
As of 2021, Guangrao County has 7 well-known Chinese trademarks for tires, 22 famous brand products in Shandong Province, over 200 overseas product certifications, and 237 registered trademarks in Madrid. The tires are exported to 189 countries and regions on six continents worldwide.
What are the challenges for Shandong tires?
Although Shandong tire enterprises are developing rapidly and becoming stronger, there are still some problems.
1. There is a gap between the good and the bad among enterprises, and there are still "just to make up for the number" enterprises
Shandong tire companies have experienced a period of brutal growth, and many companies with poor quality have also made up for them. However, over time, these companies are accelerating their elimination. According to relevant statistics, there were 565 tire factories monitored by statistical departments in China in 2013, but after 2022, there were only 180.
In a period of 10 years, 385 companies closed down, and 68.1% of tire companies disappeared in the long river of history. In the next three years, the elimination among tire companies may become even more severe.
2. Weak brand awareness and delayed attention to brand building
The Dongying Rubber Tire Industry Development Plan (2023-2025) (Public Consultation Draft) once pointed out that at present, tire enterprises do not have strong brand awareness and weak market promotion. Some enterprises still carry out original equipment manufacturer, and the product price is only half of that of international well-known brands and 2/3 of that of domestic first-line brands.
The "Plan" suggests that we can learn from the brand cooperation between Xingyuan Tire and Youke Haoma, and promote more products to enter the ranks of national well-known trademarks and brand products through brand grafting, brand authorization, and mergers and acquisitions of brand enterprises.
3. Tire companies are large but not strong, lacking core competitiveness
At present, although Shandong Province is the main gathering place of tire enterprises, its industrial concentration ratio and core competitiveness are very low. It is understood that among the top 20 companies in the competitiveness of original tires in the Chinese passenger car market in 2021, none of the Dongying tire companies have any.
Moreover, among the top 75 global tire companies, there are many Chinese tire companies, but there are no Chinese companies in the first and second camps, and the high-end market has always been occupied by foreign giants.
In the past two years, everyone has thought that Shandong Tire's position is gradually weakening, but in fact, Shandong Tire is constantly improving its internal skills, gradually shifting from winning by quantity to winning by quality. Shandong tires may tear off the stereotypical labels of low prices, low quality, and rampant counterfeits. For many enterprises in Shandong, if they want to stand out, they must constantly develop their own strength, speak with excellent products, constantly improve their own R&D strength, improve their own tire brand value, and win Lebensraum.
Disclaimer: The image materials and articles on this platform come from the internet, so the copyright belongs to the original author. If any infringement is caused to your copyright and interests, please contact us. We apologize deeply and promptly delete it. Article source: Car and Wheel Shop Owners Alliance
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