Yokohama, which is crazy about acquisitions, has actually closed its OTR factory?
Recently, Yokohama announced plans to close its Prague plant in the Czech Republic in June 2025. After the factory is closed, the production capacity will be transferred to other factories within the group.
It is understood that the Yokohama Prague plant produces agricultural tires. The plant has been in operation for more than 90 years and faces many problems such as inefficiency.
Yokohama's continuous acquisitions
In 2023, Yokohama completed the acquisition of Trelleborg Wheel Systems for 16.5 billion yuan. It caused an uproar at the time. You must know that Trelleborg Wheels has a pivotal position in the field of off-road tires. In 2024, Yokohama once again refreshed the perception of OTR tires. On July 22, 2024, Goodyear has reached an agreement with Yokohama to sell its off-road (OTR) tire business to Yokohama for US$905 million (about 6.6 billion yuan).
Bridgestone expands production capacity
On August 6, 2024, Bridgestone announced plans to invest 25 billion yen (1.233 billion yuan) to upgrade related production equipment at its bulldozer and mining tire plant in Kitakyushu, Japan. The overall equipment upgrade is expected to be completed by the end of 2027. The upgraded production equipment will help increase the value of Bridgestone's off-highway (OTR) tire business.
Is the OTR market an opportunity?
Different tire companies will have different considerations. In fact, there is an involution phenomenon in the Chinese tire market regardless of any tire. Although there is a blue ocean for OTR tires, it actually feeds a large number of small and medium-sized agricultural and engineering tire companies. After the giants come in, there will be a reshuffle, which is similar to the situation of TBR and PCR. But if you look at the world, whether it is PCR, TBR or OTR, it is very promising.
China's tire exports are huge, after all, it is impossible to digest it domestically alone. Obviously, in the case of a very involutionary domestic market, exploring overseas markets is undoubtedly the best way, and it is also a panacea for a number of tire companies to escape from the brink of suffocation. Since 2006, China has been the world's largest tire producer and rubber consumer, with tire production accounting for about a quarter of the world's total production. Domestic supply exceeds demand, overcapacity, and internal competition is serious. Although the OTR field is not so competitive, the market is so large. With the increase in production capacity, the future is full of variables. The global market is very broad, especially in the past two years, various regions are in urgent need of economic construction, and the demand for OTR tires is obvious.
But as tire giants collectively look at this market, I am afraid that the future OTR market will also usher in a storm. Among Chinese tire companies, Fengshen, Triangle, Double Coin, Prinx Chengshan, Zhongce Rubber, Guizhou Tire, Linglong Tire, Sailun Tire, etc. have already gone all out to expand the OTR market. Chinese tire companies may be like the Chinese TBR tire market. As Chinese tire companies invest more and more in OTR, they are trying their best to catch up from products to services, and gradually expel foreign OTR tires. But in any case, with the hot OTR tire market, the fierce competition is unstoppable.
