Industry experts said that after this surge in prices, the concentration of the domestic tire industry will be further enhanced and is expected to usher in a major reshuffle.
There is room for price to rise?
Recently, the reporter conducted a questionnaire survey on the website and the WeChat platform at the same time in response to whether the wave of price increases will continue.
Whether the price surge will continue
The results showed that 46% of respondents considered it difficult to say, depending on the trend of raw material prices; 40% believe that there is still room for price increase; the remaining 14% believe that the price has risen to the limit.
It is understood that the sharp rise in raw material prices is the main reason for the higher tire prices this time. Therefore, in the eyes of people in the industry, the price trend of tire products basically depends on the changing trend of raw material prices.
The data shows that after months of rapid increase, the overall increase in tire prices has reached more than 30%. However, many companies report that there is still a big gap compared with the increase in raw material prices.
Many companies expect that there will be some room for increase in tire prices.
Perhaps because of this reason, the price of rubber has turned sharply in the past month, and it has turned from plunge to plunge. Some tire companies are still increasing tire prices.
There are many people in the industry who call it "do not understand."
Some small businesses may go out
Similarly, in the face of “price surgesâ€, many companies are helpless to “catch upâ€, and even some companies say they are “injured.â€
According to the survey, 63% of the respondents to the question “What does the price of this product mean for tire companies?†selected “Some small businesses will be eliminated.â€
This shows that as raw material prices have risen sharply, small companies that previously survived low-price competition have gradually lost their price advantage, and their survival has become increasingly difficult and facing a situation of being eliminated.
"This wave of price increases may become an opportunity for the industry to reshuffle. The first to be eliminated is definitely a small business," said one industry insider.
The answers to several other questions are scattered. 14% of people chose corporate profits to rise, and 12% chose to have limited impact on the company as a whole.
Another 11% believe that the price increase will increase the operating rate of the company and increase the shipment.
What does the product price increase mean for tire companies?
According to the analysis, for large companies, they have sufficient reserves of raw material resources, rubber and most of them take the futures market rather than the spot, raw material prices have limited impact on them, but they can take the opportunity to make a big deal.
For small companies, due to limited funds, they can only “seek prices and sigh†in the face of rising raw material prices. They are afraid of losing their customers because of the obstruction of production, and they are unable to sell their products at a drastic price. This is a dilemma.
Forced enterprises to adjust product structure
What is the best way for companies to respond to price increases? To address this issue, 53% of respondents chose to adjust their product mix; 21% chose to follow prices.
Another 16% chose to try to reduce other costs, and 10% chose to hoard raw materials.
More and more people in the industry have realized that the problems of industrial structure and product structure have become the major bottleneck in curbing the healthy development of Chinese tire companies.
How companies deal with price increases
For a long time, the domestic tire industry has problems with low-end overcapacity and irrational product structure. The impact of this price increase on the industry has made this issue even more prominent.
At present, China's tire products are mainly concentrated in the low-end market, and the main means of competition is to fight the "price war", and most of the high-end market is monopolized by foreign-funded enterprises.
The current status of the domestic tire industry is extensive development, irrational expansion, technological progress and product upgrades are slow.
Against this backdrop, once the market has had a turmoil, such as the “double reverse†and “price surge†in the United States, many tire companies have become turbulent and helpless.
Some experts have analyzed that this price increase may force tire companies to adjust their product structure and even cause a big integration of the entire tire industry in China.
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