Half of Chinese tyre makers recording YTD losses
News of falling rubber prices should be welcomed by Chinese tyre makers; the Shanghai-based Oriental Morning Post reports that 50 per cent of tyre manufacturers in China have recorded losses in the year to date as a result of continued high natural rubber prices. Most manufacturers have responded to recent high raw material costs with price increases – the China Rubber Industry Association notes that since the Chinese New Year holiday period a number of tyre makers, including Michelin, Bridgestone, and Double Coin Holdings, have raised prices by between five and eight per cent. The association adds that those who have not yet increased prices are planning to do so either in March or April.
According to the Shanghai-based newspaper, Double Coin vice president Zhang Wanyou states the proportion of total tyre production cost accounted for by natural rubber has grown from 42-45 per cent to more than 50 per cent. Zhang adds that Chinese tyre makers are still facing “tremendous pressures” despite increasing prices by some 20 to 30 per cent in 2010.