“The same trend seems set to continue for the next 24 months,” said Tuomisaari. “The Chinese tire manufacturers have just started investing in material handling automation. There is a huge interest now when they have ‘woken up’.”
Adding a note of caution, though, Tuomisaari said that the production philosophy of Chinese tire manufacturers is “quite conservative” and they have not been ready to accept new ideas for their production.
“If you apply automation to the old production philosophy, the result is not very good,” he said. “It is not possible to develop competitive solutions. You’ll lose some of the efficiency. If you can accept new thinking and look at the tire plant from a new point of view, it is possible to streamline the process with help of automation and achieve a huge profitability increase.”
At the same times, however, Chinese tire makers have become more ready to invest, particularly as many of them want to export tires, Tuomisaari continued.
“On the export market, tire quality and traceability are important factors in addition to the price,” he said. “Through automation, all these can be achieved. The tire quality is improved, the traceability is achieved and the production will be less expensive.”
All major Chinese players in the market are now studying automation, continued the Cimcorp executive, noting particular interest in technology to control of the material flow with robots, conveyors, and intelligent software – can increase their productivity.
“Foreign tire manufacturers in China were the pioneers and invested in automation, but now the Chinese companies have started to do so too,” Tuomisaari concluded.
For his part, Mike Norman, VMI’s director of sales in Asia, noted a softening of the market for passenger tires because of uncertainties caused by the anti-dumping measures in the US. In recent months, however, he said that the more quality-conscious manufacturers are recovering, and the “prognosis is good”.
“There is an increasing demand for professional services, such as preventive maintenance programmes, in response to the demands of the OE market, which is a target for the more progressive Chinese tire companies,” Norman noted.
The VMI director linked the drive to higher levels of quality to plans for export growth, together with closer relationships with OE manufacturers.
Looking at market trends, Norman predicted “limited growth over the next 12 months, then more steady growth, rather than the boom of the last 18 months.
“Prospects for companies that aim to build strong brands and a good reputation for quality remain generally more positive than for the rest.”
There are, however, further challenges ahead, Norman noting overcapacity in the Chinese market, while credit had tightened, making it less easy to invest.