Shandong tire companies accelerate green development

Zhang Hongmin, President of the Shandong Rubber Industry Association, stated at the China Rubber Summit Forum recently held in Zibo, Shandong, that during the "12th Five-Year Plan" period, the development theme for tires in Shandong and even the whole country would be green tires, characterized by a series of indicators such as low energy consumption, high environmental protection, and ultra-safety. Green environmental protection has thus become the focus of Shandong, a major tire production province.

Wang Xin, office director of Shandong Yongtai Chemical Group Co., Ltd., which just received the China Well-known Trademark, said in an interview with reporters last week that due to factors such as the decline in domestic automobile production and sales, domestic tire companies will face greater sales pressure. In this situation, only by pursuing the brand industry upgrade route can the tire industry achieve sustained development. At the same time, considering that the EU has surpassed the United States to become Shandong's largest export market for tires, with exports once accounting for 40% of Shandong Province's total exports. If environmental upgrades are not carried out, tire companies in Shandong Province may find it difficult to go global.

　　"The upgrade of the green tire industry is largely passive. Foreign green trade barriers have forced our local manufacturing industry to upgrade," said Zhang Hongmin. According to the tire labeling regulation EC1222/2009 issued by the European Commission, starting from November 1st this year, passenger car tires, light truck tires, truck tires, and bus tires sold in the EU must be labeled, indicating their fuel efficiency, rolling noise, and wet grip levels.

　　"The implementation of the EU labeling law is both a challenge and an opportunity for the tire industry," Zhang Hongmin believes. The challenge is that it raises the technical threshold for products and increases production costs; the opportunity is that it helps tire manufacturers actively innovate technologically and accelerate the transformation of their development models.

　　Yang Xianli, regional manager of Shandong Haoyu Rubber Co., Ltd., told reporters that Shandong has over 300 tire manufacturers, and Guangrao Dawang Town in Shandong alone has more than 200 tire manufacturers of various sizes. In the long-term production process, the focus of Shandong tire companies has primarily been on expanding capacity and increasing output, leading to overcapacity and disorderly market competition. For a considerable period, tire companies have not put effort into the technical level, resulting in many tire formulas not being improved for decades, which directly led to the overall backwardness of the domestic tire industry.

　　"Currently, the EU labeling law has achieved certain results in promoting industrial upgrading," Zhang Hongmin said proudly when talking about the latest developments in Shandong's tire industry. "The latest data shows that 80% of tire manufacturers in Shandong Province can meet the standards of the first phase of the EU labeling law, and products from some large enterprises can even meet the requirements of the second phase."

　　Reporters learned that the EU tire labeling law is implemented in three phases, with environmental requirements becoming stricter step by step. The first phase will start this year, while the second and third phases will start in 2015 and 2018, respectively. In fact, not only the EU, but many countries and regions, considering the high energy consumption of tires, have already or are about to introduce similar regulations to improve the development level of the entire industry.

　　Song Deping, manager of Shandong Yongtai Chemical Group Co., Ltd., said: "The United States passed regulations including tire labeling provisions as early as six years ago; Japan started implementing a voluntary tire labeling system in 2010; South Korea will implement mandatory tire labeling regulations from November 1st this year; Brazil is also currently considering formulating similar tire labeling regulations. The promotion of labeling regulations in various countries will prompt our tire companies to change their production concepts, invest heavily in the research and development of new technologies and new formulas, and produce high-quality, high-value-added products. 90% of our tire products are exported, and all standards are met. The next step is to continue pursuing a differentiated brand operation strategy."

　　Reporters also learned that the key to green tires lies in the upstream raw materials for tire production, and the rubber industry, as the upstream of tires, is also actively planning innovations. Qingdao Depai New Material Co., Ltd. in Shandong has produced a new material, trans-isoprene rubber, whose main use is to manufacture environmentally friendly tires. Green tires made with it can save 2.5% fuel and extend their service life by more than 50%. Zhao Zhichao, the company's general manager, said: "Our annual production base of 30,000 tons will soon be put into operation, which will promote the production of green tires."

　　Hou Jieliang from the sales department of Shandong Weifang Zhenfu Tire Co., Ltd. told reporters that once green tire environmental standards are legally recognized, it will inevitably further drive the upgrading of the entire Shandong tire industry, accelerate the restructuring of small and medium-sized tire enterprises in Shandong, leverage the brand and technological advantages of renowned enterprises, and encourage leading enterprises to grow stronger.

　　However, Hou Jieliang also stated that according to international standards, 80% of tires currently produced domestically are low-end tires. Although these products are very cheap, they are difficult to meet international market demand in terms of environmental protection, energy saving, or service life. Most tire companies will have no problem completing the first phase, but how to complete the second phase will be a major issue that needs effort to resolve in the coming years. This is also a significant challenge facing the domestic tire industry.