Tire World Network has recently learned that a tire manufacturer in Shandong is about to suspend production and take another break.
The main reason for this suspension is the sluggish tire market and high inventory levels. According to a company representative, their primary products are full-steel tires, which are mainly targeted at both domestic and international markets. Currently, the market environment is challenging, with high production and sales costs, putting immense pressure on the company.
Recently, the domestic end-user sectors such as infrastructure, mining, and construction have seen low activity, and the freight market has performed poorly. This has led to weak demand in the replacement tire market and sluggish sales of full-steel tires.
In terms of foreign trade, issues like rising shipping costs and tight container space have been a drag on overseas tire sales. The representative noted that shipping rates have surged significantly, with some routes seeing increases of nearly 70%. The cost of shipping a 40-foot container has risen by up to $2,000.
Additionally, the company is also facing pressures from rising raw material costs and labor expenses. As a result, they have had to adopt the measure of suspending production and taking holidays to alleviate the difficult situation.
The representative mentioned that many other tire companies in the region have also adopted similar measures to adjust their production. The duration of the suspension varies from one week to several weeks.
He lamented, "It’s really tough for companies right now, and we hope the market situation improves soon."
