Double money Michelin remarry United Kingdom market

On September 5th, the WTO Appellate Body issued a ruling on China’s v. China Tire Special Safeguard Measures for WTO disputes and maintained the US Tire Safeguard Measures. Luo Xiaoming, a member of the China International Trade Association and Tianjin Institute of International Trade, said that in addition to directly affecting the export of Chinese tires to the United States, the implementation of the special security case may also lead other countries to follow the example of the US Tyre enterprises export sanctions.

China's tire market has a growing space, but at the same time it is also facing a worsening international trade environment. Only two of the roads facing Chinese tire companies have accelerated mergers and acquisitions or cooperation with foreign companies. Under the two paths, the pattern of the Chinese tire market is also quietly changing.

Reproduction of joint venture In recent days, Michelin China and Shuangqin Group (600623.SH) said that the two parties decided to jointly establish Shuangqin Group (Anhui) Huali Tire Co., Ltd. to manufacture and sell back Lifan and light truck tires in the Chinese market. According to the agreement, Michelin will invest 667 million yuan (about 75 million euros) to hold 40% of the shares of the new company, and China will hold 60% of the shares.

In fact, as early as 2001, Shuang Qiang had a joint venture with Michelin to establish Shanghai Michelin Warrior Tire Co., Ltd., Michelin holds 70% shares, and Shuangqian shares holds 30%. However, the Michelin Warrior company has a negative outlook and the accumulated losses over the past eight years have reached RMB 1 billion. In February 2010, Shuangqin had to sell its shares. Relevant sources revealed that the main reason for the failure of the first “marriage” between the two parties was the lack of dual-money shares in the management and supervision of the company, and it was only the shareholder of Michelin Warrior’s company.

Since the sale of the equity of Shanghai Michelin Warriors, due to the loss of Michelin's co-branding, Shuang Qiang shares had a blank in the passenger car tire market. How to effectively build passenger car tires becomes a top priority for dual-tire tires. In December 2010, the Shuangqin Shares announced that it will fully fund Anhui Huili Company, which has a registered capital of 1 billion yuan.

Now Michelin again, the focus of cooperation is still the car and light truck tires. According to relevant sources of ShuangQiang Shares, "Double-money shares are not bad, and Michelin's stake is better than 10%. We hope to have cooperation with Michelin both financially and technically, but mainly in equity. This is to enhance the company's core technology. Strength and increase the influence of Pull back brand are very beneficial."

Hua Yu Securities automotive analyst Zhao Yu believes that the development of dual-tire tires for passenger cars can effectively avoid the risk of a single product structure. Especially in the face of the disappointing opportunity that Kumho Tire has lost market share, it is not ruled out that the possibility of double-money shares seizing Kumho Tire has lost its market.

According to public data, Kumho Tire's market share in the domestic passenger vehicle market exceeds one-fifth. After its tire problems were exposed, its market share dropped sharply. The loss of this part of the market share makes some companies eager to try, double money shares is one of the representatives.

“Whether the double money (shares) can seize the opportunity for the tire market to fall out of trouble, it is difficult to say that after all, the opportunity is fleeting. Moreover, Kumho is not really a failure. However, the decision to enter the passenger car tire market with dual money is There is nothing wrong with it.” Yan Jinghui, deputy general manager of Beijing Beichen Yayuncun Automotive Trading Market Center, said, “It is recommended that Shuang Qiang actively strive for the qualifications of well-known automobile manufacturers in the early stage, and design the matching tires in accordance with the design of the vehicle to obtain a stable one. Market income can be stabilized."

Changes in the pattern of double return of money to the passenger car tire market, and the domestic tire market is undergoing profound changes are not unrelated.

According to relevant data from the China Rubber Industry Association, China's tire market is currently the fastest growing in the world, with a market size of approximately US$8 billion, accounting for 9% of the world’s tire market share. However, under the unfavorable conditions of raw materials such as natural rubber and steel and the unfavorable situation of China and the United States, the increase in operating income and net profit of the tire segment has narrowed.

“The special safeguard case implemented by the United States in 2009 has caused the export volume of China’s tire companies to continue to decline.” Luo Xiaoming said that after the implementation of the China-US Tire Special Safeguard Case, the number of tires imported from China by China fell by 23.6 compared with 2009. % In the first half of 2011, its imports continued to decline by 6% year-on-year.

At the same time as sales decline, the profits of the tire industry are also shrinking. According to Zhao Yu of the above analysts, compared with vehicle production, the auto parts industry has a low concentration, and the overall profit rate of domestic auto parts companies is only about 7%; in contrast, the sales profit of foreign-owned/joint ventures The rate is about 11%. "Therefore, for domestic auto parts manufacturers, the introduction of foreign high-end brands will be an effective means for companies to break through the saturation competition."

Similar to Zhao Yuxuan, the chairman of the China Rubber Industry Association, Ji Hongzhen. He once said publicly that local brands will apply the advanced tire design and production technologies originally applied in overseas markets to tires that are sold in China, and increase the cost-effectiveness of products by strengthening brand building, opening up marketing channels, and enhancing additional services. Showed a strong competitive advantage.

In fact, as early as the issue of Kumho Tire's quality was exposed, the Chinese tire market began to undergo subtle changes. In May this year, under the influence of “Kumho Gate”, the German brand tires of the Chinese mainland stopped its OEM projects in China.

"(Tyre industry) shuffling should not appear for a short time. After the market is not at its worst, the after-sales market can provide a source of profit, but export-oriented small and medium-sized enterprises may be affected." An analysis compiled by Gasgoo Automobile Co., Ltd. Wu Shuocheng.

“The special security case directly limits the export of Chinese tires to the United States, but on the other hand, it also improves the ability of Chinese tire companies to adapt to changes in the market and their survival.” Luo Xiaoming said, “The market competition changes and improves, and tire companies can Realize that there is a need to increase technological content to reduce product costs."

Nowadays, Kumho tires have lost their cities, and their shares are in high regard. This is a fiercely competitive tire market, and it has become increasingly attractive.