Tires: Investment Enthusiasm Remains High, Green Products Are Still the Focus

By Su Bo, Tire Research Institute of Double Coin Group Co., Ltd.

Enthusiasm for investment in tire production remains high in China in 2014. There are more than ten tire projects in the vicinity of Linyi city of Shandong province alone and the scale of these projects is quite big. Investments in tire production in other regions beyond Shandong are also in full swing. Most tire factories have made expansion or construction plans. It is expected that there will still be a new capacity of over 15 million pieces/a all-steel tires and over 100 million pieces/a semi-steel tires in China in 2014.

Transition to green products

Structural overcapacity of tires in China is quite prominent today. Major varieties are conventional tires with low technical content, low product grade and low added value. The output of medium and high-grade products is relatively small. The development level of differential varieties is low.
“Green tires” featuring safety, energy conservation and environmental protection are the mainstream orientation for the development of the tire industry around the world. Various well-known international tire brands have already taken the popularization of “green tires” as a major goal for future development. It is also another strategic goal for the tire sector in China after the widespread use of radial tires. Promoting the commercial production of green tires is not only a measure to cope with the implementation of the EU Tire Labeling Decree, but also a need to push the transition and upgrading of the tire sector in China.
Some key enterprises in China such as Double Coin Group Co., Ltd., Aeolus Tire Co., Ltd., Hangzhou Rubber Group Co., Ltd., Triangular Tire Co., Ltd., Linglong Tire Co., Ltd., Guizhou Tire Co., Ltd. and Sailun Tire Co., Ltd. have taken the lead in the production of green tires. All-steel tires produced in these enterprises have been assessed by the Environmental Protection Agency of the United States to be green tires.
In terms of green materials, with higher requirements on dynamic properties of tires, modified NR, SSBR, rare earth BR, high-dispersion silica white and silane coupling agent have become key raw materials for tread recipes of green tires.

Reshuffling of the tire sector

The tire industry in China the biggest in the world, but enterprises are numerous, small and scattered. The organizational structure is not very rational and the concentration degree of production is quite low. There are more than 500 tire producers in China today. The total number of tire producers in the United States and Japan is less than 20. The tire sector in China lacks large enterprises with core competitiveness and remarkable scale effect. There are therefore salient problems such as redundant construction, capacity surplus, vicious competition and low return. The concentration degree of production must be increased through merger & acquisition.
M&As of tire producers have been frequent in China in recent years. For example, Double Coin Group Co., Ltd. acquired Xinjiang Kunlun Tire Co., Ltd. Sailun Tire Co., Ltd. acquired both Jinyu Tire Group Co., Ltd. and Shenyang Heping Tire Co., Ltd. A new page of integration in the tire sector has therefore been opened. Accelerated M&As also indicate that the tire sector in China will develop more soundly in the future. With the aggravation of competition, the present status will surely last and there will be more M&As in the sector.

E-commerce of tires

At a time when market competition is getting fiercer, the profits of tire wholesale dealers keep coming down. The development of e-commerce in recent years has however brought about a wide space for market and profit. More and more tire producers and dealers have started to pay attention to this new marketing mode. Quite a few enterprises have also begun to make explorations and attempts. The geographical mode of tire e-commerce is becoming all the more diversified. The geographical distribution of tire e-commerce in Shanghai and Guangzhou holds a share of nearly 70% in China. The development in Jiangxi and Shandong is especially rapid. It can therefore be seen that the geographical competition of tire e-commerce will surely be fiercer in the future.

Green production processes

Safety, energy conservation and environmental protection are themes for tire production in future. New production processes that have emerged in recent years include the following:
(1) Low-temperature continuous mixing: In traditional tire production processes, the mixing of stock is done in stages at high temperatures. Many chemical raw materials can have chemical reactions at high temperatures to generate hazardous gases. Low-temperature continuous mixing is not only favorable to the environment, but can also enhance production efficiency and reduce energy consumption.
(2) Multi-head co-extrusion of semi-finished components: The extrusion of semi-finished components will be changed from 2-head or 3-head co-extrusion today to 4-head or even 5-head co-extrusion. In this way the production efficiency can be greatly enhanced, the production cost can be reduced, the quality of semi-finished components can be improved and the design precision can be guaranteed.
(3) Semi-vulcanization of carcasses and belt cords at the time of calendering: Semi-vulcanization conducted at the time of calendering can reduce the weight of tires and moderately shorten the duration of vulcanization. The production cost of tires can therefore be lower.
(4) Multi-drum building of tires: Dissemination of 3-drum or even 4-drum and 5-drum building machines will change the manufacture of sedan radial tires. The building of all-steel heavy-duty radial tires will mainly use 4-drum building machines.
(5) High-temperature nitrogen-filling process for vulcanization: The vulcanization of sedan radial tires, all-steel heavy-duty radial tires and off-the-road radial tires will gradually use the nitrogen-filling process so as to enhance production efficiency and reduce energy consumption.
(6) Wet-process mixing: Silica white is blended and compounded with natural latex through wet-process mixing to produce wet-process mixed stock. In this way the dispersion of silica white in stock can be remarkably improved. The mixing cycle can be shortened by 1/3 and the energy consumption in stock mixing can also be reduced by nearly 50%.
(7) One-step building technology: Compared with the two-step building technology, the one-step building technology can improve the product quality, enhance production efficiency and reduce labor intensity.
(8) Electronic radiometer vulcanizing technology: The use of electronic radiometer vulcanizing technology in the production of fiber cords for semi-steel radial tires and inner liners for all-steel radial tires can save great quantities of rubber resources and also ensure the measurement precision of tire components.

Tire test ranges

For the test of tires, indoor tests can in no way replace outdoor professional road tests. Fifty-five professional tire test ranges have been constructed around the world. All large foreign tire producers have their own tire test ranges. Michelin has seven, Bridgestone has eleven, Goodyear has six, Continental has seven, Yokohama has three, Nokian has two, Sumitomo has three, Pirelli has three and Toyo has two. Tire test ranges can be classified by function into summer test ranges, winter test ranges, off-the-road and agricultural tire test ranges and motorcycle tire test ranges.
Technologies and regulations for tire tests are not unified in the world. Tire producers are therefore faced with many difficulties in their global purchase. The tire industry in China should establish mutually-recognized enterprise tire test lab mechanisms and standard procedures and test methods for indoor test labs, test ranges and test equipment for providing mutually-recognized test data. The purpose is to reduce the test cost, unify regulations and achieve mutual recognition of test labs, technologies and methods.

Automatic and information-based production

There are already more than 30 enterprises in China involved in the design and manufacturing of tire equipment. Besides complete modern equipment for the production of bias tires, they can also provide basic complete production equipment for the emerging radial tire sector. The supply of tire equipment has been turned from the seller’s market in the past to the buyer’s market. In addition to satisfying the domestic demand, some equipment is also exported to advanced countries such as Japan and the United States and Southeast Asia.
Equipment automation is already widespread among multinational tire producers. Examples include MIRS of Pirelli, BIRD of Bridgestone and C3M of Michelin. There is however still a considerable gap between production equipment provided by tire equipment suppliers in China and advanced automatic production technologies in foreign countries. China needs to develop more automatic and information-based production equipment in the future.