Since 2011, the global tire market, especially the Chinese tire market, has seen slow growth, which directly impacts the market demand for tire molds.
In 2012, China tire mold industry harvested the revenue of RMB3.01 billion or so, including RMB1.87 billion from automotive tire molds, only up 0.16% year on year.
In terms of profitability, the performance of most Chinese tire mold manufacturers declined in 2012. During the first three quarters of 2012, Himile's revenue only increased by 0.37% year on year, and its net income fell by 6.28%. Meanwhile, the growth rate of Greatoo also slowed down, with the revenue being the same with that in the same period in 2011 and net income up by5.92%.
Among other non-listed companies, the revenue of Shandong Dawang Jintai dropped by 21.77% year on year in 2012, and that of Yuantong witnessed a year-on-year decline of 12.26%.
Seen from new construction project, there were merely two major tire mold projects in 2012: the tire mold project co-invested with a total capital of RMB1.1 billion by Henan Yasheng and Jiaozuo Deke Mould; and the 300-set radial tire mold virtual manufacturing technology project of Shandong Dawang Jintai.
In the projects invested and built before 2012, Himile's "precise radial tire mold construction project" is delayed until the end of September 2013 instead of the planned December 2012, with the investment of RMB349 million. Greatoo's "large-sized engineering vehicle tire and special tire mold expansion project" is under construction; the project aims at the mold market of military SUV tires, aerospace tires, racing tires, snow tires, high-grade sedan tires, etc, with huge market potentials. With total investment of RMB197 million; the project is expected to be put into production in July 2013.
Although the current tire mold industry is sluggish, we expect that China's domestic demand for tire molds will grow at the average annual growth rate of around 7% with the moderate recovery of Chinese automobile market in the next 2-3 years.
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