In 2012, the sales revenue of tire manufacturers exceeded CNY 400 billion in China. In 2012, the price of tire materials fluctuated and decreased sharply. Among that, the annual average price of natural rubber (SCR10) decreased from 33,835 CNY/ton to 25,053 CNY/ton, decreasing by 25.9% YOY; that of styrene butadiene rubber (1500) decreased from 26,808 CNY/ton to 20,519 CNY/ton, decreasing by 23.5% YOY; that of butadiene rubber (grade 1) decreased from 30,225 CNY/ton to 22,833 CNY/ton, decreasing by 24.5% YOY. The causes are as the following: 1. natural rubber supply was sufficient, but its price kept decreasing due to the influence of global slump economy; 2. prices of coal and crude oil kept low, so the price of synthetic rubber also decreased after lost cost support.
In 2012, tire price decreased due to the weak demand and decreasing price of raw materials. The annual average prices of radial tires (165/70R14) for sedan and biasply tires (7.501614PR) for light truck were 265 CNY/set and 701 CNY/set respectively, decreasing by 5.7% YOY and 12.5% YOY respectively. However, the gross margin of tire industry(http://www.researchmoz.us/research-report-on-china-tire-industry-2013-2017-report.html) increased obviously because of its enlarged profit space. In 2012, the total profit of tire industry reached CNY 27.5 billion, increasing by 43.7% YOY, which was 40% higher than the growth rate of output volume. Meanwhile, the return on assets was 7.3%, increasing by 2% over 2011 with the profitability enhanced.
Many international tire giants have begun to successively enter China since the 1990s. Attracted by the low production costs in China, many multinational tire enterprises treat China as an important tire production base. China's advantages in huge market demand and low costs are extremely attractive for global tire investment. At present, over half of China tire market has been occupied by foreignfunded enterprises. Moreover, foreignfunded enterprises firmly occupy the domestic highend market, so their profit margins are usually twice that of China local enterprises or even more.
Get Copy of This Report@ http://www.researchmoz.us/research-report-on-china-tire-industry-2013-2017-report.html