So far in 2023, the head enterprise of China's tire industry with double growth in revenue and profit has opened a new round of expansion tide; Relying on price increases to increase sales of foreign tire enterprises in order to improve profits, open a new capacity layout. The significant increase in downstream capital expenditure has laid the foundation for the high prosperity of the tire mold industry.

"The tire mold business in the second half of 2023 is not bad." Soft Holdings also saw a sharp increase in orders in hand in the first three quarters of last year, Homag said. On January 30, Giant Wheel Intelligence announced that the company recently signed a sales contract with 10 tire manufacturers of hydraulic vulcans, and the contract amount exceeded 60% of last year's revenue.

"The tire industry boom is high, and the shortage of semi-steel tires has become a common phenomenon in the industry, so many enterprises have the demand for increasing capital expenditure, and the prosperity of the upstream mold industry is expected to continue." The person in charge of a domestic tire mold company told the Cailiannews reporter that his company is a foreign-funded factory opened in China, and in recent years, with the continuous improvement of the quality and performance of domestic tire mold equipment, "orders have been taken away a lot."

Downstream increased capital expenditure

Since 2023, tire companies have generally had sufficient orders in hand, prosperous production and sales, and significantly increased their performance, which has become the base for tire companies to increase capital expenditure.

According to "tire business" statistics, from 2023 to February 2024, the global tire production capacity investment of nearly 100 billion. Among them, the car tire investment increased the most, the amount of more than 44.6 billion; Next is off-highway tire investment of more than 7 billion; Almost no change in investment is truck and bus tires - not only did not increase investment, many tire companies also announced the suspension of investment, or even directly cut the relevant production capacity.

In terms of domestic tire companies, Cailian.com reporters found that, in addition to individual companies, going overseas and expanding production overseas has almost become the "standard" action of listed tire companies, and the pace is getting faster and faster, and the overseas base selection area is more extensive. In the next few years, the overseas production capacity of tire companies such as Sailun tires, Senkirin, and GM shares, especially the semi-steel tire production capacity, will usher in a new wave of rapid release period.

According to statistics, as of the end of 2023, a total of 12 Chinese companies have built a total of 18 tire factories overseas, and seven tire factories are under construction.

In the second half of 2023 alone, Racing Tire announced three overseas capital expenditure projects. In December last year, General shares issued an announcement that the wholly-owned subsidiary of Cambodia intends to invest in the construction of Cambodia's high-performance radial tire project (Phase II), and Senkirin also continues to promote the globalization layout.

The relevant person in charge of Senkirin said that the company's Morocco base began construction in October 2022 and is expected to be put into production in the fourth quarter of this year, and the Spanish base is expected to start work by the end of 2024 and may be put into production in 2026. Both bases have a planned capacity of 12 million semi-steel units.

It is worth noting that Thailand's "double reverse" review landing further favorable semi-steel sea. "Double reverse" is an important variable affecting China's tires to go to sea, in January 2024, the United States announced the final outcome of the anti-dumping review in Thailand, the tax rate is to be reduced from 14.62-21.09% to 1.24-6.16%. The reduction of tax rate is conducive to the optimization of profitability of Thai factories and the improvement of competitiveness in overseas markets.

Tire mold company orders are sufficient

The downstream strong capital expenditure, the upstream tire mold enterprises have benefited a lot, and the orders of related enterprises have been greatly improved.

Among them, as of the end of the third quarter of 2023, the company's contract liabilities were 3.945 billion yuan, an increase of 35.43% year-on-year, an increase of 12.51% quarter-on-quarter, the inventory reached 5.922 billion yuan, an increase of 32.20% year-on-year, an increase of 16.68% quarter-on-quarter, and the orders in hand continued to grow rapidly.

In the first half of 2023, the company's tire mold business revenue was 1.85 billion yuan, an increase of 9%. The relevant person in charge of the company said that in the second half of last year, the demand for foreign tire molds continued to grow steadily, and the company's tire mold business was still good.

In terms of giant Wheel intelligence, the company announced at the end of January that the sales contracts of hydraulic vulcans signed with 10 tire manufacturers recently amounted to 5.74 yuan, more than 60% of last year's revenue.

Giant Wheel Intelligence said that since the second half of 2023, benefiting from the continued recovery of domestic economic activities and the increase in overseas market demand, superimposed tire raw material prices and sea freight fell, the tire industry recovery momentum is strong, but also for the tire factory's technical transformation and overseas new plant investment provides a driving force, driving the company's related product orders to improve.

In addition, Soft Holdings recently announced that the company and its subsidiaries based on the 2024 annual market forecast and daily production and operation needs, the proposed daily related transactions with Sailun Tire and its subsidiaries are expected to be no more than RMB 3.045 billion. From January to November 2023, the actual amount of transactions between the company and its subsidiaries and Sailun tires was 1.817 billion yuan.

A few are happy and a few are sad. With the continuous development and growth of domestic tire mold enterprises, the living space of some foreign-funded enterprises has been squeezed. The person in charge of a foreign-funded mold company told reporter that the technical level of local tire mold companies is getting better and better, and the research and development investment is also large. In recent years, "many orders have been taken away by local enterprises."