On July 1, 2015, the new national standard for compound rubber began to formally implement. This has brought tremendous challenges to China's rubber products companies. In fact, since the beginning of this year, China's rubber industry has faced more than this pressure, the "double reverse" final ruling, excess production capacity, foreign brands occupying the market and other pressure are rushing to the industry. In the face of pressure, how should China's rubber tire companies respond? The reporter conducted a survey interview.
Current situation: Internal and external pressures intertwined
It is understood that the new national standard compound rubber called the "composite rubber general technical specifications", the standard proposed a new definition of rubber compound, the provisions of its raw rubber content shall not exceed 88%. Prior to this, the raw rubber content of the rubber compound was 95% to 99.5%, and it enjoyed a zero tariff for a long period of time. According to the new tariff plan for 2015, the tariffs on cigarette film and standard rubber will be increased from 1200 yuan/ton to 1,500 yuan/ton. This means that if the compounding glue cannot be produced and imported in accordance with the "88% raw rubber + 12% non-gel component" new formula, then the existing 95% - 99.5% raw rubber content of the compound glue will be regarded as the original glue, each Tons of imports are subject to a tariff of 1,500 yuan/ton. This change made the majority of rubber products, especially tire companies, miserable.
Shen Jinrong, chairman of Tire Leader Enterprise Zhongce Rubber Co., Ltd., said that according to the import tariff of 1,500 yuan/ton, the cost of tire companies in the production of raw materials will increase by 12% to 13%. In addition, tire companies require very strict production materials. From modifying the production formula, production process, and later product testing, tire companies need a long time to adapt to the new standard.
In addition to pressure from changes in domestic standards, the pressure from abroad is even greater. Recently, the second phase of the Hankook Tire Plant in Chongqing (car tires for passenger vehicles) was put into operation, and it was introduced into China's new base brand, Luoufeng Tire, in January this year to manufacture and manufacture 400,000 pieces of tires annually. Following the two production bases in Jiaxing, Zhejiang and Huai'an, Jiangsu, Chongqing is Hankook's most automated production base in the country. The second phase of this production will add 6 million new production capacity, making its total production capacity of Chongqing Hantai tire close to 7 million in 2015. This also means that Hankook Tire is further expanding its base for China.
More than Hankook Tire, previously, Continental Horse Tire revealed that the company plans to expand its Chinese production capacity to 12 million per year in the next few years.
In addition, Chinese passenger car and light truck tires are highly dependent on the U.S. market, and 40% of China’s tire production needs to be exported, with the United States accounting for nearly 30% of the total. However, at the same time, the United States is also one of the countries that have launched the most "double reverse" investigation on Chinese export tires. The "double opposition" has seriously affected China's tire exports to the United States. Affected by the US "double reverse" policy, tire factories in Shandong and Fujian have already closed down, and domestic tire factories have actively reduced their operating rates.
The statistics provided by the China Rubber Industry Association to 44 tire member companies also support the pressure on companies: In the first quarter of this year, except for the stocks, the economic indicators of the tire industry declined.
Li Guixian, vice president of the Institute of Petrochemicals at Gansu University of Technology, stated that China is the world’s largest rubber producer and consumer, and most of its leading products rank first in the world. However, the rubber industry in our country is large but not strong. The outstanding weakness is that there are not a large number of backbone enterprises with international competitiveness, and there is a lack of brands with high awareness and influence in domestic and foreign markets.
In the past, under the mode of scale expansion, rubber companies relied on cost advantages such as investment expansion and labor to gain market competitiveness. At the same time, China’s rubber companies always focus on internal issues and gain greater benefits by strengthening management and strengthening implementation to improve efficiency and reduce costs. There are also some companies trying to maximize the interests of enterprises outside the enterprise, but because of the lack of practical measures, they finally return to the management efficiency of the company. Such development ideas are feasible and effective in the high-speed development period of the rubber industry, and have won the first opportunity for the rubber industry in China and laid the foundation for future development.
However, the current situation has changed. “At present, foreign-funded enterprises are using China as a production base to accelerate the infiltration of their products in the domestic market. Under such circumstances, only by forming the advantages of a Chinese brand-name group can they compete with large multinational companies in order to withstand both inside and outside. Pressure," Li Guixian pointed out.
Coping with one: Build Industry 4.0
“From a big rubber country to a strong country, products must move from the current low-end to the mid-to-high end. Intelligent transformation is an important direction for the rubber industry to move toward high-end, that is, China's manufacturing upgrades to China’s wisdom.†China Rubber Industry Association Chang Dengya pointed this out.
Deng Yaxi said that intelligent production is the development direction of the tire industry. It can be expected that in the next five to eight years, there will be more and more tire smart factories in the world. At the same time, 3D printing technology and other advanced technologies will be grafted or combined, and More applicable materials have been developed, and 3D printing technology will be applied first to small-volume tire production, and will be increasingly popularized. At that time, the traditional tire production process will have a disruptive impact.
It is understood that a number of advanced rubber tire companies have now taken the lead in building Industry 4.0.
The Double Star Green Tire Intelligent Production Demonstration Base Project occupies an area of ​​2,500 mu and has an investment of 4.5 billion yuan. It plans to build three demonstration bases for commercial tires, passenger car tires and smart equipment; a construction entrepreneurship center, a global cloud network center, a global R&D center, and a national level Testing center, national testing center, global logistics center, six world-class industry centers. After the project is completed, it can achieve a leap from low-end to high-end, high-differentiation, high-value-added, and low-return odds. The manufacturing level can be automated, intelligent, networked, and highly efficient, forming a process automation for tire manufacturing. The interlinked enterprise, manufacturing intelligence, and the development of the green recycling economy in the tire industry have initially assumed the characteristics of the tire industry industry 4.0.
According to the plan, in 2015, the Double Star Group will start production of intelligent machinery and equipment projects by the end of the year. At the same time, six auxiliary center projects were started one after another; the second phase of the plant construction began in the second half of the year; the traditional upgrading equipment of the old factory area began to relocate in October and it is expected that the relocation will be completed in the first quarter of 2016. After the completion of the project, the tire production capacity can reach 15.1 million sets, including 5 million sets of all-steel radial tires, 10 million sets of semi-steel radial tires, and 100,000 sets of large-scale engineering tires, which will become the first green and environmentally-friendly tire in China. Industry 4.0 factory.
According to industry insiders, many domestic tire factories have started to adopt AGVs (automated truck robots) and robots in order to increase the level of automated production of enterprises. Progress has been made in this regard. Tire intelligent manufacturing can integrate modern equipment technology, robotics technology, automated warehouse logistics technology, information technology, internet of things technology, and big data technology into the entire life cycle of tire manufacturing, liberating labor, enabling tires with dual characteristics of process production and discrete production. The manufacturing process realizes the automation, transparency, visualization, and flexibility of the production process, as well as the effective coordination and control of key elements such as personnel, equipment, materials, and quality.
Respond 2: Increase industrial concentration
It is understood that there are a large number of rubber industrial enterprises in China, and the scale is generally small, and most of them can not achieve economies of scale. Like tires, China has more than 500 tire companies, while Europe and the United States have only a dozen, and Japan has only a few, and the industrial concentration and market competitiveness are far higher than us. From the experience of international multinational companies, mergers and acquisitions have always been an important way for companies to become bigger and stronger.
Therefore, Deng Yaxi pointed out that it actively implements mergers and reorganizations, optimizes the industrial organization structure, and develops a group of large companies and large corporations with independent intellectual property rights and obvious advantages in the main business by strengthening the main business, resource integration, business process reengineering, and capital operation. Improving the competitiveness of enterprises and the efficiency of resource allocation and making famous brands are important choices for China's rubber industry to become bigger and stronger. The establishment of Tire Group is conducive to the improvement of production efficiency, is conducive to the increase in investment in science and technology, is conducive to the construction of well-known brands, is conducive to the unified procurement of raw materials, is conducive to the unity of the product sales network, the use of tire companies "going out "The implementation of strategy. Enterprises must have a qualitative leap, and they must join forces to set up enterprise groups, which can be a combination of tire companies. They can also be based on geographical distribution, product division of labor and other mergers and acquisitions, and can also be tire companies and upstream and downstream enterprises. In short, to narrow the gap with the world’s tire multinational corporations, we must first promote the development of China’s tire group.
Industry insiders generally agree with this view and believe that there are many tire companies occupying an important position in the rubber industry, and the industry concentration is far below the world average. With the current structural overcapacity of tires and increasingly stringent local policies, mergers and acquisitions are the most effective way to quickly increase the degree of concentration. In the future, the concentration of the tire industry will further increase, and a number of advantageous enterprises with competitive advantages and good brand reputation will gradually form on the market. These enterprises will have a certain right to speak in the market, and the market share will also grow steadily and expand. Individual companies may face greater competitive pressure or even the fate of elimination.
Coping 3: Fostering World Famous Brands
To create their own brand is also the industry's most concerned about. "After decades of development, China's rubber industry has laid a good foundation and has the strength to cultivate world-renowned brands. There is a group of domestic enterprises that produce OEMs for international famous brands, which shows that in some areas China's rubber industry has reached or exceeded. The advanced level in the world, manufacturing capacity, technical level and product quality are comparable with those of international top brands.†Senior Engineer Xu Dianhong, who is engaged in the research and development of synthetic rubber at China National Petroleum Corporation's Lanzhou Chemical Research Center, told reporters that the domestic independent rubber brands have not had a strong international influence. The main reason is that domestic companies do not have enough awareness of the importance of the brand, resulting in insufficient investment in the cultivation of the brand.
Li Jinshan, styrene-benzene plant engineer at Lanzhou Petrochemical Rubber Factory, said that rubber companies should focus on their own brand strategy and corporate development strategy, target the key technologies of the world's rubber industry, and promote the adoption of a “four-in-one†innovation platform for production, research and development. Leading independent innovation. Through independent innovation, we will improve the quality, variety, and benefits of our business and use technological innovation to enhance our brand value. Relevant departments of the state must also build key laboratories, engineering laboratories, and engineering research centers with world-class standards in some key scientific research institutions and enterprises to provide technical support and services for the development of China's rubber industry and enterprises.
For improving the brand's influence, Xu Dianhong suggested that the “going out†strategy is an important strategy for deep integration into the world economy, international management, and building multinational companies. From the experience of international multinational companies, mergers and acquisitions have always been an important way for companies to become bigger and stronger. Enterprises can also conduct overseas mergers and acquisitions through outbound direct investment, participate in the international division of labor and the distribution of markets and resources, expand new development space, and cultivate new growth points. It is necessary to actively acquire foreign brands, and on this basis, nurture several independent brands with international influence. By going out, adjust the global trade layout, investment layout and production layout. In this way, not only can we export all kinds of rubber products, we can effectively realize the outward delivery of production capacity, we can also provide more equipment and technical support to foreign countries, and promote the rapid development of foreign emerging markets.
Zhongce Rubber Thailand Co., Ltd., which has just been put into production, shows the exploration of the global layout of large enterprises in China. It is understood that on June 29th, Zhongce Rubber Thailand Co., Ltd. held an opening ceremony in Thailand's Thailand-China Rayong Industrial Park. This marked that China’s tire leader Zhongce Rubber Group Co., Ltd. successfully created its first foreign automobile tire production base. It is an important step for the Chinese tire companies to "go global" strategy. According to reports, Zhongce Rubber Thailand Co., Ltd. was established in September 2014 with an investment of 1 billion yuan and covers an area of ​​840 acres. It is estimated that the total investment will be 15 billion baht (about 3 billion yuan) and will become the Thai-Chinese Rayong Industrial Park. The largest rubber factory in the construction area and the expected production scale.
Shen Jinrong stated that Zhongce Rubber has world-class production technologies and has extensive experience in cost and energy consumption control and is highly competitive. He emphasized that going international is an inevitable choice for companies with advanced international technologies to develop to a certain extent.
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