Rubber & tire industry in numbers

PROJECTS

BASF is building a second production facility to produce microcellular polyurethanes in Shanghai China, to meeting the country’s “booming electric vehicle market”. The German group has broken ground on the €60 million plant, which features advanced mould lines and will increase production capacity by 70%. The unit, to be built at BASF’s existing PU facility in Shanghai, is set for operation in 2027. 

Continental AG has extended a project to enhance sustainability in smallholder natural rubber (NR) cultivation in Indonesia. Launched in collaboration with the German development agency in 2018, the project involves training NR farmers to implement sustainable practices and enhance rubber yield. Carried out in the UNESCO-recognised the district of Kapuas Hulu, the project is now being extended by three years to the end of 2027. 

Mitsubishi Chemical Corp. has announced plans to expand its production capacity for flame-retardant compounds based on polyolefins and thermoplastic elastomers. As part of the move, the Japanese group is installing new production lines at Mitsubishi Chemical Performance Polymers (China) in Jiangsu, and MCPP France SAS in Tiffauges, France.

M&A & RESTRUCTURING 

German trade union IGBCE has criticised the planned divestment of ContiTech, Continental AG’s materials and industrial arm, as a standalone business entity. The separation at the time of global economic uncertainty is “socially irresponsible, economically foolhardy, and technologically nonsensical," said Francesco Grioli, member of IGBCE executive board and the Continental supervisory board. The process, he argued, involves tearing apart two business units which he said “have formed the heart of the long-established group for decades and are closely intertwined, especially at the beginning of the production chain.”

BUSINESS

Pirelli has announced that it is not making any investment in US production capacity, due mainly to unresolved issues surrounding its shareholder structure. The 11 April announcement was in response to media reports suggesting that Pirelli intended to invest $1 billion to improve output at its manufacturing plant in Rome, Georgia. “The company states that the desire to increase its production capacity in that market, in line with a local-for-local strategy, has been known for some time,” said the Italian tire maker in a brief statement. 

Michelin Group’s first-quarter performance is set to be weighed down by weaker-than-expected volumes, as the group navigates the implications of Donald Trump’s tariffs on its operations. In a 9 April ‘pre-close’ call, the French group confirmed that its first-quarter volumes are expected to come in within a -6% to -8% range compared to 2024, driven by depressed OE demand in the wake of the final quarter of 2024. 

US TARIFFS 

Washington's imposition of import tariffs on automotive vehicles & parts is going to make a significant dent in US sales of vehicles and, in turn, tires, believes Robert Simmons, director, tire & rubber research, GlobaData. Most directly impacted will be the OE segment, which represents about 20-25% of the tire market, Simmon said at AGM of the International Institute of Synthetic Rubber Producers held 7-10 April in Dublin. 

Semperit AG expects US import tariffs, along with a continued slowdown in order intake and ensuing capacity adjustments, are likely to have “a significant impact” on its business performance. Assuming the recently announced tariffs remain unchanged for its main production sites, the Austrian group has revised its 2025 earnings (EBITDA) forecast to €65–€85 million, down from a previous estimate of €70–€90 million.

SHARE PRICES

Leading tire manufacturers’ share-price trends

Leading rubber product manufacturers’ share-price trends

MATERIALS

Natural rubber  

The Association of Natural Rubber Producing Countries (ANRPC) expects internal drivers to help strengthen NR pricing, despite ongoing trade tensions globally. In its February market review, published earlier this month, ANRPC said a tightening in NR supply could help boost rubber pricing in the near term. Factors such as the El Niño weather pattern, aging plantations, and a shortage of skilled tappers have significantly impacted production, raising prices in February, it said.

NR futures ended the week sharply lower across all major exchanges, with Chinese markets posting double-digit week-on-week losses. All major Far East markets reported declines during the week ended 11 April, primarily driven by “stop-loss selling and long liquidation,” reported Japan Exchange Group 14 April. 

JPX: Selected rubber futures price trends on major trading exchanges

 (ERJ calculation for selected futures)

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