ZC aims to be among the top 5 tire companies

Zhongce Rubber Group Co. Ltd. (ZC) intends to enter the top five largest tire manufacturers within the next five years, according to Vice President of the Chinese company Haoyu (Henry) Shen, who spoke with Modern Tire Dealer.

According to Shen, who was educated at Columbia University (USA), in 2023, ZC's revenue was 35.2 billion yuan (4.5 billion dollars), which allowed the company to take ninth place in the global tire industry ranking. At the same time, as the ZC representative emphasizes, increasing sales volumes is just one of the company's goals, and another priority is "improving efficiency in all aspects of activity," resulting in significant investments in research and development, whose "volumes are higher than those of many competitors."

Not long ago, ZC announced that it would build new tire plants in Indonesia and Mexico, and after the launch of the first stages of both enterprises, the company's total capacity will increase by 15%. The first tire produced in Indonesia should be released this year, and the industrial complex in Mexico is expected to start operating in 12-15 months. In both cases, only 40% of the available land will be used, leaving room for future expansion.

Currently, ZC has nine plants, eight of which are located in China, and one in Thailand. At the end of last year, a new highly automated production of passenger tires was launched at the company's headquarters in Hangzhou. In 2022, Tianjin United Tire & Rubber International Co., Ltd. (TUTRIC) was acquired, which produces tires for specialized equipment under the Tianli brand, helping to increase the company's turnover. According to Shen, ZC plans to generate 25-30% of its revenue in the OTR tire and rubber track segments.

The Chinese market remains key for ZC, accounting for 53% of the company's total sales. However, over the next three years, it is planned to reduce this figure to 40%, meaning ZC intends to generate 60% of its revenue outside of China.

Aboard, one of the most important markets for ZC is the United States, which accounts for 25% of the company's export sales. The shares of the passenger/light truck and truck/bus tire segments are approximately 50/50, and, as Shen noted, it is planned to expand the presence in the OTR tire market with the help of the Tianli brand.

Regarding the market positioning of the tires produced, Shen said that "today, consumers buy our tires because they are a good product offered at an affordable price." "Our new generation tires have shown excellent results in various tests around the world, and we want to offer customers high-end and mid-range products at medium and low price points," he added.

Shen also noted that the preferences of electric vehicle owners have significant features, especially in the rapidly developing Chinese market. "Vehicles of this type are not cheap, but their owners pay great attention to the price issue when buying tires," he said. "For this reason, we are seriously working on improving the functionality of our tires, primarily in terms of reducing noise and rolling resistance."

If we talk about the truck tire market, then, according to Shen, "fleet managers around the world think the same way, and we need to offer products with premium-level characteristics, but not at a premium price."

ZC produces tires under its own brands Arisun, Chaoyang, Goodride, Tianli, Trazano, and Westlake, as well as under private brands of its clients.