Tire exporters "get angry" and crash directly. What's going on?

The EU Commission's official trade website shows that the EU will officially launch a trade protection investigation against Chinese tires on May 20, 2025. It is understood that the EU plans to launch anti-dumping and anti-subsidy investigations on my country's passenger car and light truck tires!

Global blockade of Chinese tires

It is not just one country or region that is anti-dumping Chinese tires. India, Brazil, the United Kingdom, Mexico, the United States, the European Union and many other countries and regions are implementing different degrees of encirclement of Chinese tires. Especially the United States... Since Trump took office, the Sino-US trade war has reached a new height.

In the US market, truck tires have risen to 2,000 yuan each

As of now, the export tax rate for Chinese tires is still 145%, which means that the price of a truck tire exported from China to the United States has still risen to 2,000 yuan each. What's worse is that the crazy reversal of tax rates has caused the cost of shipping to "soar".

Shipping is increased, and exports are more difficult

Due to the constant "change of orders" in "reciprocal tariffs", the US customs system has malfunctioned. In order to allow the goods to pass customs, the United States recommends that importers submit the goods release order on site and submit financial documents after the problem is resolved-temporarily tax-free. Some importers began to take advantage of the "fault repair period" to place orders frantically. In addition, some goods from countries and regions that were informed that tariffs would be adjusted back by 10% within 90 days, as well as goods exempted from tariffs, "flocked" to the US market in a short period of time.

A "run" occurred on shipping routes, and prices on US routes soared. It is reported that the price of US-bound sea freight increased by 6-8 yuan per kilogram. According to the weight of the truck tire, the freight for exporting a truck tire to the United States has increased by at least 300 yuan. The price of Chinese tires exported to the United States has increased by 1,400 yuan per tire within a month! The price advantage is gone! Therefore, some Chinese tire companies, adhering to the idea of ​​saving a little bit, (it is reported that 30% of direct export goods) began to seek transshipment transportation. But when I called the transshipment transportation service provider, I was immediately told that the service fee had increased!

Service fee plus 30%

Since the tariffs in many regions of Southeast Asia have been reduced to 10%, some Chinese tire companies hope to conduct re-export trade through Vietnam, Thailand, Malaysia and other regions when exporting to the United States. If calculated according to the current tariffs of these regions, even if the tires exported to the United States are superimposed with high freight, the price of each tire will only rise to 1,400 yuan at most. In contrast, it still has a greater price advantage. However, Chinese tire companies have already figured out all the ways of exporting since the tire special protection case in 2008. When a tire company can think of re-export transportation, 99% of Chinese tire companies have already started to prepare.

It is reported that after the 90-day window period, re-export transportation issued a service fee increase notice to tire companies under the "supply and demand shortage". Although the specific price increase has not been accurately disclosed, there are rumors that the maximum price increase may be 30%. Calculated in this way, even if re-export trade is used, the price of a tire exported to the United States may exceed 1,500 yuan. The price advantage is gone, and the road to transporting Chinese tires to the United States is almost blocked.

Foreign trade hit hard, tire exports directly dead

Although in 2024, China's truck tires accounted for only 4.94% of US imports, the 930,000 tires shipped to the United States are still an important source of profit for many tire companies - a tire that can only be sold for 600 yuan in the domestic market can be sold for 1,000 yuan in the United States, and the profit of one tire exported to the United States is equivalent to the profit of three tires sold domestically.

This is why Chinese tire companies have formed a business strategy that focuses on foreign trade after more than 30 years of rapid development - foreign trade accounts for more than 55% of revenue; foreign trade accounts for more than 70% of profit. The blockade of Chinese tires by many countries has undoubtedly dragged most tire companies, especially those that have not built factories overseas, to the brink of losses. Of course, the US market is "insignificant" in the export share of many companies, but with the EU's increase. Chinese tires are even more difficult.

Overseas production capacity has become a new favorite

As tire exports encounter another crisis, the overseas production capacity of Chinese tire companies has taken a dominant position. Many companies have set up production bases in Southeast Asia, Europe and other places. These bases can not only reduce production costs, but also respond to market demand more quickly. The business model is similar overseas and domestically. Companies still need to face market competition, product quality and customer relations. However, the advantage of overseas production is that it is closer to the target market, reducing transportation time and cost. The most important thing is to avoid the impact of double anti-dumping.

Long-term pain challenge of tire exports

Speaking of tariffs, in the past 15 years, it has long turned from pain to long-term pain. However, looking back at the development of Chinese tire companies, especially the development of leading tire companies, you will find that many tire companies have been reborn under the heavy pressure of exports.

The heavy pressure of tariffs in 2008 forced Chinese tire companies to make up their minds to implement the overseas strategy. Overseas factories will play a key role in dealing with US tariffs this time.

Many tire companies that did not build factories overseas also decided to open up overseas market channels after 2008, reducing the proportion of overseas export single markets. Facing a new round of challenges starting in 2025, some tire companies have begun to think about new countermeasures, and even consider "tightening their belts for a while" - reducing costs to temporarily overcome difficulties.

The tire business has never been smooth sailing, which has forced tire companies to develop from high quality-price ratio to high brand power and multi-track operations. I believe that tire companies that have been reborn in the new round of tariff reshuffles will find new growth points and business breakthroughs in the next 20 years, giving them a new development path!