Global Tire giants focusing on China

Michelin Corporation has announced recently to boost production capacity of its Shanghai joint venture and open another tire factory at Southern China. The firm has also signed a memorandum with the provincial government of Liaoning in northeast China covering new truck tyre and sedan tyre projects, the official Xinhua news agency reported this March.

China's mid and high-end replacement tire market is mainly shared by early birds like Michelin, Bridgestone, which has four tire plants in the country, and Goodyear, which has a site in Dalian and was the first global tire firm to set up a plant in China.

Currently more and more global tire manufacturers are eager to cash in on China's growing vehicle population. Companies, like Italy's Pirelli and German peer Continental, said they will mainly focus on the medium and high-end market in China to compete with Michelin and Bridgestone.

Insiders predict that the entire Chinese tire market is set to rise at a rate between 20 and 25 percent a year. According to the reports, more than 50% of the tire market in China is occupied by foreign enterprise whose profit margin goes as high as 20%.