“When the Japanese tire industry only grew at a rate of 2%, China’s tire companies maintained a growth rate of 20% to 30%. With the overall economic development slowing down, this rate of development may have become a thing of the past. China The rubber industry must adapt to the trend of economic growth slowdown.” At the high-end forum on the strategy of investing in M&A in the rubber industry recently held, the executive deputy chairman and secretary-general of the China Rubber Industry Association, Deng Yachen, reminded the industry insiders.

China's rubber industry is developing fastest

The development of the past 30 years has made China the fastest growing country in the rubber industry in the world. According to the data, during the “Eleventh Five-Year Plan” period, the average annual growth rate of the rubber industry's output value, sales revenue, exports, and output of major products was more than 30%.

In Deng Yan's eyes, "this development should be said to be unique."

Affected by the financial crisis, the growth rate of China's rubber industry in the first year of the 12th Five-Year Plan was ten percentage points lower than the entire “Eleventh Five-Year Plan” period, but the growth rate still exceeded 10%.

According to Deng Yaxi, at present, the radialization rate of domestic tires has reached 87%, the proportion of high-strength conveyor belts and cord V belts has reached 90%, and the disposal rate of waste rubber has reached more than 85%. The rubber industry has become a model of recycling, its clean productivity is also increasing, and energy consumption is constantly decreasing. At the same time, in terms of clean production, energy saving, and green development, carbon black and rubber chemicals have also achieved a lot.

"The restructuring of the rubber industry is still very effective." This is Deng Yayi's overall feeling.

Rubber industry slows down

It is understood that as of the first half of the year, the growth rate of China's rubber industry has further slowed since last year, with the growth rate dropping below 10%, while the past growth rates were all between 20% and 30%. According to Deng Yaxi's judgment, although the growth rate of the industry is declining, the overall development of the rubber industry tends to be stable.

In the first half of the year, export growth of rubber products slowed down and fluctuated. Data show that in January, the export value of rubber products fell by 5.8% year-on-year, of which tires fell by 12%; in April, the export value of rubber products increased by 14% year-on-year; as of the first half of the year, tire exports grew by 7%, rubber tubes, Bands also saw a year-on-year increase. The reasons for the above situation, in Deng Yaxi's view, in addition to the seasonal fall, there are fluctuations in the European economy, as well as the impact of international trade friction factors.

"This year's rubber industry is a mixed blessing. Fortunately, the price of rubber raw materials has fallen by a large margin; the worry is that market demand is decreasing." Deng Yalu analyzed that the price of raw materials has fallen, and at the same time, the prices of products have also declined, the market's Fluctuations have made it difficult to control production and operating costs. This makes it possible to further reduce the profit margin of the industry.

She pointed out that the previous high-speed growth has obscured many contradictions. This year, due to lack of market demand, the contradiction of overcapacity is further manifested, and overcapacity leads to an increase in inventories. Due to the promotion of performance projects, rubber products, pipes, belts, sheets, and tires all have excess capacity at different levels. The most prominent issue is structural overcapacity. This results in low-level, homogenous competition for the product, which in turn leads to a price war.

It is understood that the declining market demand has resulted in high inventory in the rubber industry. According to statistics from the China Rubber Industry Association, the inventory of 200 companies showed that in the first half of the year, their inventory increased by 8% year-on-year, and the growth rate of almost all product inventory was higher than last year. Deng Yayi disclosed that the inventory amount has now reached about 15 billion yuan. If there is no change in the economic trend in the second half of the year, there will be more and more inventories. [next]

Industrial concentration is too low

According to analysis, during the “Twelfth Five-Year Plan” period, the problem of the Chinese rubber industry is very prominent: On the one hand, domestic companies are still weak on independent research and development; on the other hand, the product structure is irrational, there are few high-end products, and homogeneity is serious; In addition, the technological process, technological equipment and intelligence, etc., have a large gap compared with the international advanced level.

In Deng Yaxuan's view, one of the outstanding problems is the low concentration of industries. According to data from the National Bureau of Statistics, there are more than 3,000 rubber products enterprises above the national scale. The sales of domestically-funded companies in the top ten of the tire industry accounted for about 30% of the sales of all tire companies in the country; and the top three tire companies in the world accounted for more than 40% of the world's sales. As for tires, belts, rubber shoes and other enterprises, the scale is small and scattered, and the problem of low concentration is even more prominent.

Deng Yaxi also introduced that the main raw materials and products in China are highly dependent on foreign countries. 80% of rubber is imported, 40% of tire products are used for export, and there are many barriers to trade, and the prices of raw materials and exports are controlled by others. In addition, the upstream and downstream developments are not coordinated, which is influenced by factors such as domestic technology level, brand building, and consumption habits.

She said that the domestic domestic domestic brands are still at a disadvantage in the automotive industry. The economic growth models of domestic companies are mostly extensive, extensional, and expansive, resulting in weak brand competitiveness. In terms of scientific and technological development, at present, the production scale, computer application technology, process control, and management modernization of domestic companies all differ greatly from the international advanced level.

SMEs should be professional, refined, special, and detailed

At this meeting, Deng Yaxi explained the future development trend of China's rubber industry.

First, the technological progress of enterprises has been further strengthened, and independent innovation and development of specialty products have been adhered to.

Specific to the product, the focus of China's tire development is to realize the industrialization of green tires. Whether it is the "labelling system" or other technical trade barriers, it emphasizes the fuel and energy consumption of tires, improving the energy conservation and environmental protection of products, and product performance. Therefore, tires must achieve industrial upgrading.

The development goals of domestic pipe belts and other rubber products are also energy saving, environmental protection, light weight and safety. The main raw materials of rubber products, including carbon black, green rubber additives, etc., must be developed in the direction of technological progress, green security, energy conservation and environmental protection, and high performance.

Second, we must promote the merger and reorganization of enterprises and optimize the organizational structure.

The number of domestic rubber companies is large and the scale is small. The number of tire companies in the world does not add much to China. At present, there are 11-12 EU tire companies; in the United States there are 16-17, and there are about 40 production plants; in Japan, there are only five. Multinational corporations have also experienced development, mergers and reorganizations for decades or even hundreds of years before they reached today’s industrial concentration. China has its own characteristics, of course, but also SMEs, but these companies need to be professional, refined, unique, and detailed.

Third, companies must promote the level of industrialization, information, and intelligence. The inspection and exchange of the China Rubber Association’s enterprises abroad has found that the automation, linkage, and management of foreign companies is very high. Automation and linkages are the deadly short boards of the Chinese rubber industry.

Fourth, vigorously develop technical materials for energy conservation and emission reduction, including improving the production equipment and processes of domestic enterprises.

Fifth, the competitiveness of domestic brands is very low. It is necessary to transform, upgrade products and cultivate brands. Among them, the transformation of development is fundamental, and it is necessary to use capital operations to promote industrial upgrading.

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