Rubber & tire industry in numbers

 PROJECTS

China’s ZC Rubber is planning to invest Yuan1.8bn (€215m) in phase II of the ‘Zhongce 5G green factory’ in Qiantang district, Hangzhou, to ‘more than double’ production capacity. Phase I if the of the ‘Future Factory V2.0 was completed in December 2023, with a capacity to produce 10m passenger car tires/year.

Linglong is partnering with Paraguay-based tire distributor/importer Sunset SA Comercial Industrial Y De Servicios for a Yuan8.7bn (€1b) project, in Ponta Grossa, Parana state, Brazil Yuan8.7bn (€1b) project. The JV will be 70%-owned by Linglong and 30%-owned by Sunset. The proposed facility will have a capacity to produce 12m passenger car tires, 2.4m truck & bus tires, 200k engineering tires, and 100k retreads, as well as 6kt of ‘liquid reclaimed rubber’. Construction is set to start in Q3/25 with full completion scheduled for 2032.

Kumho Tire is progressing plans to build a European production base, having narrowed down location candidates to Poland, Serbia and Portugal. The South Korean tire maker is ‘actively evaluating’ candidate sites for the KRW1trn (€616m) project.

Chinese tire maker Jinyu Tire Group has completed the construction of a passenger car tire plant in Vietnam – an expansion of its existing truck & bus tire production facility in Tay Ninh province, which currently has a capacity to produce 2m tires year. The car tire unit with the capacity to produce 10m units/year. Ramp-up to full capacity is slated for H2/26. Once the project enters full-scale production, the group will have a dual production capacity of 10m TBRs and 10m PCRs a year across its production sites.

Contec SA has expanded its operations with the opening of a rubber lab in Szczecin, Poland, where it currently operates a tire pyrolysis plant. The “state-of-the-art” GumLab laboratory will help the Polish recycler advance rubber compounding and material testing, said a company release.

LD Carbon has inaugurated South Korea’s “first and largest” waste tire pyrolysis plant. Located in Dangjin, the unit is to begin full-scale operations next month, with capacity to process 50ktpa of “tire chips” derived from end-of-life tires, and produce 20ktpa of rCB and 24ktpa of pyrolysis oil. LD has signed a 10-year offtake deal with SK Incheon Petrochem for the pyrolysis oil and is also collaborating with tire maker Hankook.

M&A & RESTRUCTURING

Toyoda Gosei (TG) has launched structural reforms across its Chinese operations as it reported fiscal-year sales down 17% year-on-year to Yen95bn (€586m) in China, mainly on lower production volume by automotive customers.

The region also posted an operating loss of Yen7.2bn, compared to an operating income of Yen5 billion reported in the previous fiscal year, due to lower sales and impairment losses.

Continental will cease tire manufacturing operations at its Alor Setar production plant in Malaysia by the end of 2025. The unit is one of two Conti tire production plants in the country and has capacity to produce 3m passenger car, light truck, and motorcycle tires/year. The closure will impact 950 employees currently working at the Alor Setar facility.

Apollo Tyres NL BV will discontinue tire production and related activities at its Dutch plant in Enschede by summer 2026, due to “macro-economic disruptions, steep increases in energy and labour costs, a decline in demand for its tires, and pricing pressure from low-cost competitors. The unit has capacity to manufacture 670,000 units of tires/year.

MARKETS & BUSINESS

Michelin Group reported a 1.9% year-on-year decline in Q1 sales to €6.5bn and overall volumes were down 7.3% on lower OE sales in all segments – continuing a ‘prolonged’ trend since H2/24. Its passenger car and two-wheel tires unit (RS1) reported a 1.2% year-on-year increase in sales, lifted by a positive mix effect. Replacement and Michelin-brand tires saw a 4% year-on-year increase but segment volumes fell 3%. In Europe, RS1 volumes dropped 13% year-on-year, while N. America saw an 8% decline.

South Korea’s Nexen Tire posted Q1/25 sales of KRW771bn (€477m), up 13.7% year-on-year and earnings (EBITDA) up 1.5% to KRW99.5bn. Nexen linked the gains to increased volume at its European production base in Czechia and premium products such as large rim-sized tires. Overall, Europe revenues reached KRW316.5bn, 41% of total group sales. N. America sales came in at KRW181bn, 24% of overall revenue.

Trelleborg Group has reported Q1/25 earnings up 8% year-on-year to SEK1.98bn, on sales also up 8% at SEK8.89bn. Organic sales increased 1%, while acquisitions contributed 6% and currency effects 1% to the higher sales. At Trelleborg Industrial Solutions (TIS) sales totalled SEK3.9bn, up 5% vs Q1/24. Trelleborg Medical Solutions (TMS) posted a 45% year-on-year increase in sales to SEK848m, while earnings more than doubled to SEK171m. At Trelleborg Sealing Solutions, organic sales remained unchanged while acquisitions contributed to 6% growth to SEK4.3bn. Segment earnings increased slightly to SEK868m.

Zeon Corp.'s elastomer business posted a 10% year-on-year increase in fiscal 2024 sales to Yen362bn (€1.5bn) and operating income up 65% to Yen10.9bn – reflecting better selling prices, mainly for synthetic rubbers and latexes, and currency shifts. Q4 elastomer sales totalled Yen58.1bn, up 4% year-on-year, while operating income reached Yen2bn, more than three times higher than the same period a year earlier. Q4 volumes fell 9% year-on-year, with synthetic rubbers seeing a 13% year-on-year decline but a 10% recovery quarter-on-quarter. Synthetic rubbers contributed Yen42.7bn to Q4 revenues, up 4% year-on-year but down 2% quarter-on-quarter.

Munich, Germany-based Wacker Chemie’s silicones division reported Q1 sales up 5% year-on-year to €745m, while earnings grew 33% to €108m, reflecting “an improved product mix, with a significantly higher proportion of specialty products.” Sales volumes of products for the health sector, including silicone adhesives for wound care, were particularly strong.

Elkem ASA achieved Q1/25 earnings (EBITDA) of NOK201 (€17m) within its silicones division, which is currently under strategic review. This compares to a loss of NOK103m in Q1/24. Gains were linked to “improved cost positions” and lower cost of materials, despite turnaround shutdowns at facilities in China and France. Segment sales for the quarter rose 16% year-on-year to NOK3.8bn, on higher volumes partially offset by lower selling prices. Sales volumes were up 34% year-on-year due mainly to higher demand in Asia-Pacific.

Toyoda Gosei posted a 1.1% year-on-year decline in sales to just over Yen1,000bn for its fiscal year, while operating income fell 11.6% to Yen60bn. Japan sales fell 0.8% year-on-year to Yen440bn and  operating income by 28.2% to Yen11.4bn. In Americas, operating income grew by 30% year-on-year to Yen34bn, on 1.7% higher sales of Yen404bn. European revenue fell 5.2% to Yen32.7bn and operating profit by 3.1% to Yen2.6bn. In India, revenue rose 20.2% year-on-year to Yen42bn, while operating income rose 24% to Yen4.3bn. TG forecast sales of Yen1,000bn for the current fiscal year and an operating income of Yen55bn.

Versalis reported a 7% year-on-year decrease in Q1/25 volumes to 800kt on lower demand and plant shutdowns. For the three months to 31 March, Versalis, reported a proforma adjusted loss of €243m – 45% above a loss of €168m recorded for Q1/24.

SHARE PRICES

Leading tire manufacturers’ share-price trends

Leading rubber product manufacturers’ share-price trends

MATERIALS

Natural rubber 

Natural rubber futures remained under pressure in the final trading week of April, posting week-on-week declines across all major markets. Market participants "grew cautious" about selling at already depressed price levels, reported Japan Exchange Group, adding that, "the recent sharp downturn in prices has left many traders hesitant, with a noticeable reluctance to take on large positions."

JPX: Selected rubber futures price trends on major trading exchanges

 (ERJ calculation for selected futures)

Previous ERJ Week in Numbers