On July 11, the China Association of Automobile Manufacturers released the production and sales of automobiles in the first half of 2022. The data shows that in June, the production and sales of automobiles were 2.499 million and 2.502 million respectively, an increase of 29.7% and 34.4% from the previous month, and a year-on-year increase of 28.2% and 23.8%, respectively. The production and sales data have increased significantly.
In the first half of the year, the production and sales of automobiles were 12.117 million and 12.057 million, down 3.7% and 6.6% year-on-year, respectively. In the first half of the year, it was mainly affected by the epidemic in Shanghai and Beijing from March to May, and the loss of sales was about 1 million.
Among them, the policy-driven effect of passenger car production and sales data is obvious, and the production and sales data have rebounded significantly, especially for Chinese brand cars, which increased by 16.5% in the first half of the year.
However, the commercial vehicle sector continues to be in the doldrums, and there is still no hope of recovery.
Commercial vehicle sales plunge 41% in first half
In June, the production and sales of commercial vehicles reached 261,000 and 281,000 units, up 15.7% and 17.4% month-on-month, respectively. Although they also rebounded, they fell by 33.2% and 37.4% year-on-year.
From January to June 2022, the production and sales of commercial vehicles reached 1.683 million and 1.702 million respectively, a year-on-year decrease of 38.5% and 41.2% respectively, and negative growth for 15 consecutive months.
The production and sales of commercial vehicles were 1.683 million and 1.702 million, down 38.5% and 41.2% year-on-year respectively.
The China Automobile Association has lowered its forecast for the annual sales of commercial vehicles this time. Affected by multiple unfavorable factors, the China Automobile Association predicts that the sales of commercial vehicles in 2022 is expected to be 4 million units, a year-on-year decrease of about 16%, compared with the forecast at the end of 2021. 4.5 million, down 500,000.
The downturn in commercial vehicle sales and the replacement market also affected all-steel tire production.
All-steel tire production fell 14% in the first half of the year
1. Sales of all-steel tires are sluggish and inventories are high
According to the statistics of all-steel tire manufacturers monitored by Zhuochuang Information, the total output of all-steel tires in China in June 2022 was 10.8421 million, a year-on-year increase of 4.66%. From January to June 2022, the cumulative output of all-steel tires in China was 58.3545 million, a year-on-year decrease of 14.14%.
From the point of view of the operating rate, the operating load of the 26 all-steel tire enterprises monitored is 57.30%, still maintaining a low position.
For the 25 tire companies monitored, the total inventory of all-steel tire sample companies at the end of June 2022 was 13.158 million, an increase of 1.13% month-on-month and an increase of 11.63% year-on-year.
2. All-steel tire enterprises are polarized
According to the research of car and wheel, the current all-steel tire market is seriously polarized.
On the one hand, some all-steel tire manufacturers are in the dilemma of low production, low sales, and high inventory, and some tire companies have even experienced tire shrinkage and weight reduction due to high raw materials.
On the other hand, we have also seen that some tire companies still maintain high operating rates and sales despite adversity, such as Guizhou Tire, Jinyu Tire, Chaoyang Langma and other companies.
A CCTV reporter interviewed Jinyu Tire, who said that the company’s annual production capacity is now 6.3 million, and Jinyu Tire has achieved full production since May this year.
Liu Zhiyuan, director of Jinyu Tire Company, told reporters, “Our shipment volume in May was about 600,000, an increase of 33% year-on-year. Our order volume in June also hit a new high in our company’s history.”
The reason for this differentiation is that Che and Wheel believe that there are three main aspects:
- Since June, the domestic epidemic has been controlled and the economy has recovered rapidly;
- The export market is booming, driven by overseas tire factories;
- When the market is down and sales are sluggish, low-quality tires compete fiercely for the market in the low-price competition, while high-quality tires have a strong market share and customer loyalty in the market, and market fluctuations have less impact on them.
The reshuffle of all-steel tire companies begins
China has vigorously developed the infrastructure and real estate industries, and China’s all-steel tire production and demand have also ushered in rapid growth.
Entering 2022, China’s domestic infrastructure development is slow, and the real estate industry has also entered a downward channel. In the context of unprecedented changes in a century, the demand logic for all-steel tires needs to be reorganized.
Experts believe that the era of China’s economic development driven by infrastructure and real estate is no longer feasible. In the future, China’s economic growth will be driven by new infrastructure and high-tech enterprises.
The all-steel tire market will also usher in a major reshuffle. The demand for low-quality and low-tech tires and the market competition environment will be even worse, and many tire companies will be forced to withdraw.
At the same time, the market demand for high-quality tires will continue to open up, and high-quality tire companies will speed up the expansion of production capacity and occupy more space for development.
The fundamental of all competition is the contest of strength. Only by producing tires that are recognized by the market and abandoning the low-end products with serious homogeneity in the past can we survive in the industry reshuffle.
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