Tire industry is under pressure, mergers and acquisitions may increase

2022-04-25

As the prices of raw materials and logistics continue to rise, the cost of tire companies is extremely under pressure. Coupled with the downturn in the market, the company's profits have been continuously compressed. Tire companies are facing the dilemma of "unprofitable".


In addition, due to the impact of the epidemic, some car companies have stopped production one after another, which has also brought a great impact on the tire industry. Since March, many car companies in Jilin, Shanghai and other places have announced the suspension of production. Up to now, there are still many car companies that have not resumed production. This undoubtedly makes its upstream tire industry "worse".


According to the tire world network, due to the decline in demand in the end market, the inventory of tire companies has continued to hit new highs. The data shows that by the end of March 2022, the total inventory of semi-steel tire sample enterprises was 18.63 million, a year-on-year increase of 15.77%; the total inventory of all-steel tire sample enterprises was 12.435 million, a year-on-year increase of 41.34%. According to the heads of many tire companies, this is the most difficult year in the industry.


The overall pressure on the tire industry has intensified the reshuffle speed of domestic tire companies to a certain extent. In 2021, many small and medium-sized tire companies have gone bankrupt.(Article source: Tire World Network)





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