Local tire companies collectively start price hike in September

18 September 2021 | Source from China Rubber Web

On September 15th, the two largest listed carbon black companies in China, Yongdong Co., Ltd. and Longxing Chemical, rose to the limit in the stock market, and the main capital inflowed sharply. According to the analysis of investment institutions, this is consistent with the recent high price of coal tar, and the willingness to increase carbon black prices in the second half of the next year related. In recent times, domestic high-temperature coal tar prices have continued to rise strongly, and the ex-factory price of the highest in some markets has exceeded 4,300 yuan/ton. Affected by rising raw material prices, carbon black companies are currently willing to increase prices.

As an important raw material for tires, the upward price of carbon black is undoubtedly another cost hammer for tire manufacturers. On September 15, Huasheng Rubber issued a price increase notice, announcing that due to the recent high prices of tire raw materials, operating costs have been rising. From October 1st, the prices of its Compassion tires, Hybyde tires, Shield Wheel tires, Lubo tires, Kodak tires, Guofeng tires and OEM brand PCR products will be increased by 2%-6%.

In addition to Huasheng Rubber, the tire giant GiTi Tire also couldn't bear it, saying that in order to drive the development of Jia'An passenger car tires, the group has been digesting the pressure brought by rising raw material costs. The implication is now no longer able to bear it. The price can only be raised for the brand, and the current price system will be raised by 5% in stages from October 1, 2021 to December 31, 2021.

Since September, 7 well-known tire manufacturers have announced price increases, including Michelin, Linglong Tire, Zhengxin Rubber, Fengshen Tire, Double Star, etc., and the price increase policy has clearly spread to October. It can be said that this round of price increase is obviously "ferocious" compared with the previous half year.

At present, it has come to the "Golden September and Silver October" season, where the annual price increase notice is the most intense. China Tire Business Network believes that other tire companies will follow to issue price increase notices. However, in view of the current weakness of the terminal market, it remains to be seen whether the price increase policy can be successfully implemented. For dealers and tire stores, they may fall into the embarrassing situation of not daring to increase the price again. Only by reasonably preparing goods and properly adjusting the market strategy can they avoid becoming a "back pot man".

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