A few days ago, the CCTV financial channel "Punctual Finance" made a detailed report on the current situation of the tire industry, and made a comprehensive investigation from the aspects of cost pressure of tire companies, dismal market sales, and poor logistics.
Tire factory profit compression, "watch the dish to eat"
Market demand is further cold, the cost of raw materials is indeed pressing step by step, tire manufacturers are facing the situation of "no profit", many enterprises began to "watch dishes to eat", adjust the scale of production to adapt to market changes.
A tire company in Hangzhou, Zhejiang, due to the recent lack of demand, poor logistics and other factors, the company took the initiative to reduce the output, the factory specifications from more than 2,000 to more than 1600 kinds.
The output decline and profit compression, enterprises began to reduce the loss of raw materials from all aspects to reduce labor costs and alleviate operating pressure.
"Now a system of 64 vulcanizers only needs to patrol one shift at a time to produce products with the fewest people, the fastest beat and the best production mode." Relevant staff said.
The chairman of a rubber group told reporters: "Now we can only call to watch dishes to eat, such as ensuring the production of marketable products and compressing some products with relatively high inventory." At the same time, we have done a lot of work on the digitalization of the factory, which can significantly reduce the cost of the entire process. ”
In 2021, 28,000 tire companies were written off
According to Tianyancha data, in 2021, the mainland will cancel nearly 28,000 tire-related enterprises, an increase of more than 37% year-on-year, but some leading enterprises are accelerating the adjustment of production structure and developing an efficient, high-quality and low-cost production model.
Experts said that the market environment that is not prosperous in the peak season is also accelerating the reshuffle speed of the domestic tire industry.
"In difficult times, we must strengthen the industry's self-discipline, establish brand awareness, and do product quality, and when the market warms up, if some small enterprises go out of business, the remaining enterprises will usher in better development space." Xu Wenying, president of the China Rubber Industry Association, said.
Prices have risen, and logistics costs have risen sharply
In addition to the lack of demand for tire markets, since the beginning of this year, with the continuous rise in energy and logistics costs, tire prices have also continued to rise, which has further aggravated the operating pressure of tire companies.
In a tire direct store in Hangzhou, the reporter saw that the store canceled a series of preferential activities at the beginning of the year. "In January last year, we will do some buy three get one free activities, a 205/55 R16 specification, four tires is 1200 yuan, this year this specification is sold according to the original price of 399 yuan, the price is almost no preferential space." Staff said.
Since the beginning of this year, the prices of tire rubber, carbon black, etc. have been rising, and the cost of logistics labor is also rising. In mid-April, outside a brand factory in Hangzhou, the reporter saw that a large number of finished tires were stacked outside the factory waiting for transportation.
The staff told reporters that in previous years, there were cars waiting for goods, and now it is impossible to wait for a car for a few days. "It is difficult to send the whole tire out, and there are very few drivers who meet the conditions of the epidemic prevention policy in various places, and there are fewer and fewer." Some raw materials can not be in place in time, the price of raw materials has almost doubled several times, and the price of finished products has increased four or five times since last year, but that is, more than a dozen points. ”
Distribution prices are inverted and gross margins are declining
In addition, the dealers in the intermediate links on the one hand to complete the upstream manufacturers' indicator tasks, on the other hand, as far as possible to shorten the payment cycle, which also caused the already sluggish tire market, the price competition is becoming more and more fierce, and the profit margins continue to be compressed.
Assistant to the general manager of a tire trading company in Beijing said, "Throughout the first quarter, our side of the tire brand has a rise of about 10%-15, but it is impossible for the market to rise so high, and even sometimes the price is upside down, then our gross profit is lower." Compared with last year, the company's gross profit fell by 3%-5%. ”
Tire store sales plummeted and forced layoffs
In March and April every year, as the weather warms up, the tire industry has entered the traditional peak season, but this year's epidemic has been spread for many years, car companies have stopped production, logistics and other factors, which directly triggered the sluggish demand in the tire market.
A retail store in Beijing, since February, a total of about 100 tires have been sold, the store head told reporters, in the peak season this is only a week's sales volume, now can only sell 4, 5 a day, last year an average of more than 20 per day.
"Finance, car washing and other work are all done by ourselves, there were 8 people in the store, and now they are all laid off, that is, we do it ourselves."
In the low season environment, in order to avoid too many goods in the hands, retailers mostly choose a small number of multiple purchases, which invisibly increases the burden of upstream agents again.
Dealer inventory doubled, sales fell short
A tire dealer in Beijing told reporters that in a certain batch of inventory in the warehouse, the most stored has reached half a year, and the inventory pressure is very large.
"The use of the car is not so large, the loss is correspondingly reduced, the normal inventory of a certain specification is more than 20 days to turn around, and now it is almost two months." The larger the specification, the slower the turnover, such as a heavy truck tire, the previous two months turnover period, now reached 6, 7 months. Warehouse logistics manager said.
The chairman of a Beijing tire trading company told reporters, "In the first quarter of previous years, more than 300,000 pieces were sold, with an inventory of 150,000 pieces, and in the first quarter of this year, 150,000 pieces were sold, the inventory was 300,000 pieces, the sales volume fell by 50%, and the inventory doubled." Everyone is in order to complete the factory's indicators, so the inventory pressure is very large. ”
Zhuo Chuang information data show that as of the end of March 2022, the total inventory of semi-steel tire sample enterprises was about 18.63 million, an increase of 15.77% year-on-year; the total inventory of all-steel tire sample enterprises was about 12.435 million, an increase of 41.34% year-on-year, and the inventory of domestic tire enterprises was high.