The Forbes ‘Asia’s Fab 50’ ranks the “best of Asia Pacific’s biggest listed companies,” and this year’s list has been described by the business magazine as a “roll call of outfits that have managed to thrive amid decelerating growth in Asia and all but nonexistent growth in their US and European markets.” For 2012, Forbes has added Cheng Shin Rubber Ind., manufacturer of the Maxxis tyre brand, to the list. At present Maxxis is the only tyre brand represented in the Fab 50 table.
Taiwan-based news service CENS reports that Kenda Rubber intends to invest approximately NT$10 billion (£212 million) to set up a plant in China’s Guangdong Province. At the company’s recent shareholders meeting, chairman Yang Ying Ming stated the tyre maker is acquiring 700 acres in Huizhou, and intends to relocate its existing Shenzhen factory there. The plant will produce motorcycle and bicycle tyres and daily output is expected to reach 83,000 pieces by 2016. Industry sources also say the new Huizhou factory will be much bigger than the Shenzhen plant as it will contain passenger car radial production lines intended to serve the European and US markets.
According to CENS, growing demand for car tyres in China is expected to continue soaring, and Taiwanese tyre-makers are ready to take advantage of the opportunity. For example, Cheng Shin expects to see 10 to 20 per cent revenue growth this year, according to some institutional investors said. Other tyre-makers Kenda Rubber Industrial Co., Nankang Rubber Tire Corp., Hwa Fong Rubber Ind., Ltd. and Federal Tire Corp., are also looking at increased business in China.
With China accounting for about 34 per cent of global rubber demand in 2011 and with demand for cars slowing last year in the People’ Republic, the varied economic climate is proving to be a challenging environment for the countries fast growing domestic tyre manufacturers.
According to China Daily and Bloomberg reports, China's economy is forecast to grow 8.5 per cent next year, the least in 11 years, according to the Organization for Economic Cooperation and Development (OECD). Vehicle sales may rise by the least in 13 years in 2011, plunging from last year's record 32 per cent, the China Association of Automobile Manufacturers reported.
Taiwan-based tyre makers including Cheng Shin Rubber Ind. Co. and Kenda Rubber Industrial Co., are expected to see substantial growth in earnings in the first quarter of 2012 due to declines in raw material prices, particularly natural rubber. Furthermore, according to Taiwan Economic News, the European sovereign debt crisis means tyre manufacturers have slashed inventories to get rid of the risk in the prices of stocked goods.
Maxxis has declared its presence at this year's SEMA show, which ran from 1 – 4 November, as “a hit.” According to the company, Maxxis was “a standout among SEMA’s 2,100 plus exhibitors, offering hot new tyres for road racing, crossover vehicles, SUVs and light trucks.” The company hosted at 2,500 square foot indoor booth and in addition visitors to the Maxxis support rig enjoyed a close up view of racing vehicles around, including Johnny Greaves’ Class 1 desert car. Some of Maxxis’ most popular sponsored drivers dropped by as well, including Greaves, Brian Deegan, Steve Barlow, Dan Vanden Heuvel, Randy Eller and Ken Blume.
Following the news that Maxxis has ended its exclusive relationship with Grouptyre, and with everything pointing to the likelihood that a new distributor will soon be announced, the company has announced how it intends to make a much broader range of its car, van and 4×4 tyres available.
According to a statement released by the company, while continuing to develop its profile and grow its share of the UK tyre market, Maxxis plans to ensure that its product portfolio is readily accessible to retailers across the whole of the UK.
Maxxis International thanked its top 18 performing retailers of 2010 – the winners of the top prize in the Maxxis Rewards programme – by taking them on a seven-day, all expenses paid trip to China. A mix of culture and business, the visit combined sightseeing visits to major attractions in Shanghai, Hangzhou and Shuzhou with a tour of the Maxxis factory in Kunshan.
When financial analysts said that 2009 was a “banner year” for Cheng Shin Rubber Ind. Co., Ltd. in a report published back in May, the market watchers weren’t overstating the facts. But in 2010, when the 2009 results were made public, the Taiwan-based tyre manufacturer which is responsible for the Maxxis brand and Maxxis International companies, announced plans for two new factories, an international standard proving ground and some high profile OE contracts. It was also the year that saw the company move into 10th place in Tyres & Accessories’ annual ranking of tyre manufacturing companies. With all this in mind T&A recently visited Cheng Shin/Maxxis’ Kunshan tyre production plant near Shanghai, China and asked if 2010 was the real breakthrough for Maxxis? And if so what happens next?
Recently Maxxis announced its continuation as headline sponsor of the ACU British Motocross Championship by signing up for the 2011 to 2013 seasons. To mark a decade of commitment to the series – the tyre maker first served as sponsor in 2001 – Maxxis has decided to take stock of how its presence in the motorcycle sector has grown over the years.
Maxxis has honoured its three decade long relationship with ExxonMobil Chemical (EMC) by naming it as a Best Supplier. Maxxis has purchased butyl products, used in the manufacture of its tyres, from ExxonMobil Chemical for more than 35 years and the award recognises the two companies’ history of joint technology development as well as EMC’s leading–edge technology and advanced technical support.
Analysts at Deutsche Bank has upgraded Continental AG’s stock rating to “buy” after raising its earnings per share (EPS) estimates by more than 20 per cent for 2010 and 2011. According to the analysts the revision is entirely attributable to better volumes: “With car production in the second quarter close to the first quarter, our new second quarter adjusted EBIT estimate is 540 million (versus 400 million euros previously) and our full year adjusted EBIT is upgraded by 13 per cent to 1.87 billion euros (consensus: 1.75 billion).” Writing in an investor’s note published on 11 June, the analysts explained that this corresponds to an EBIT margin of 8.1 per cent and to an adjusted EPS of 3.9 euros, 8 per cent above consensus.
Sources reported by China Knowledge indicate that Taiwan based Cheng Shin Rubber will invest NT$12 billion (£223.5 million) establishing a new tyre manufacturing facility in its home market. Construction work on the new plant is expected to get underway in June 2010 and be completed a year later. According to a company financial executive the facility will hold an initial capacity of 14,000 passenger car tyres and 3,000 truck and bus tyres; output from the new site will help raise Chen Shin’s passenger car tyre production capacity by 10 to 15 per cent.