Profits of China’s tire industry plunged in 2017 and quite a number of tire producers are loss-making.
Among the 38 member tire enterprises of China Rubber Industry Association, 16 of them suffered losses of 1.55 billion yuan in Jan.-Oct.
The 38 enterprises paid taxes of 4.81 billion yuan in the first 10 months, down 44.81% year on year; and their profits dropped 54.06% to 2.36 billion yuan.
Starting from April, their profits dropped over 50% year on year.
The profit margin of domestic tire producers was 1.97%, down 2.96 percentage points from the same period of last year.
However, although the profits decreased, the output, sales, and sales revenue of the tire enterprises have grown.
In the first 10 months, the association’s 41 key member tire enterprises produced 345 million cover tires, up 8.12% year on year; and their sales revenues totaled 141.88 billion yuan, up 15.13%.
The phenomenon is considered to be abnormal.
Fluctuated raw material prices and higher production costs are the major reasons for such situation.
In addition, the enterprises’ export volume in Jan.-Oct. was 164 million tires, valued 54.42 billion yuan. The export rate was 47.4% in terms of volume, or 38.36% in terms of value.
It shows that the profit of exported tires has shrunk further.
