Service needs prompt Kobe Steel to open rubber machinery unit in China

Tokyo — Kobe Steel Ltd will, next month, open a company in China to sell tire and rubber machinery and provide after-sales service, the company announced 22 March

Called Kobelco Machinery System Engineering Qingdao Co. Ltd (KMQ), the new company will be based in Qingdao, Shangdong Province.

Kobe Steel has invested Yen40 million (€300,000) in KMQ, which will supply rubber mixers, twin-screw, roller-head extruders, testing equipment and other machines used in the manufacture of tires and other rubber products.

“We decided on Qingdao because many of our customers are in Shangdong province,” explained a Kobe Steel spokesman in a written statement to ERJ.

Kobe Steel, however, has “no plans to manufacture rubber mixers in China,” he added in response to ERJ’s question on this point.

The Japanese company has one production plant in China, a facility manufacturing tire-curing presses in Yiyang, Hunan.

Kobe Steel's main production base is in Takasago, Japan, with a US plant in Hudson, Ohio – making mixers, twin screw roller head extruders, and one in Kanchipuram, Tamil Nadu, India – for mixers, twin-screw, roller-head extruders

Asked why Kobe Steel is making this investment amid a downturn in the Chinese tire industry, its spokesman explained: “Although the market is decelerating and difficult conditions will continue for the time being, over the years we have delivered many units of rubber machinery, which will need maintenance and parts.

“To provide close service to customers on site, a company such as KMQ is required. Mixers, in particular, have to be overhauled after six to eight years of operation or new mixers outright may be needed.

“Kobe Steel supplied many mixers around 2012 and anticipates that the need for a local presence will arise in the near future.”

World tire production has been increasing more than 3 percent annually in recent years, with China making up a nearly 40-percent share, noted the company press statement – citing figures from the Japan Automobile Tyre Manufacturers Association.

Tire production in China is forecast to grow from 520 million units in 2015 to about 650 million units in 2020, the company added.

Kobe Steel said it had, to date, supplied over 250 units of tire and rubber machinery to China.

The establishment of KMQ is in part linked Kobe Steel’s plans to gain a 50-percent share of the world market for rubber mixers.

Kobe Steel said it "anticipates an overall sales increase of around Yen1 billion (€8 millon) for its tire and rubber machinery in fiscal 2020."

In its filing for the ERJ Machinery Survey 2016, Kobe Steel estimated the company's rubber machinery sales in fiscal 2015 at over €200 million.

The March/April issue of ERJ magazine includes an in-depth report on the global tire and rubber machinery sector.