By: Luigi Caffù. Published in Linkedin.
I have recently written a couple of articles about the relevant share of Chinese tyre imports in the European market, trying to make some focus on a subject that is very well known and discussed by professionals and associations in the Tyre Sector (ETRMA explicitly mentions the “continuous growth of imports, which will be confirmed also for 2016” ). This phenomenon is more evident in the Truck segment, and that is why I would like to dedicate an insight to the “doors” from which Chinese goods are entering.
First, let’s recap the long term statistics about volumes and values.
Eurostat has finally published all the 12 months figures for 2016, therefore we can observe the Full Year statistics including last year. As always, Eurostat trade figures include the flow of goods performed by Companies whose Headquarter is not located in China; however, the majority of imported tyres comes from producers headquartered in the Asian country, and consequently the conclusions of any import analysis can be reasonably associated to them.
We can observe that truck tyre imports have heavily grown in volume in FY 2016, with a percentage increase vs 2015 much bigger than the growth in value (mln€). This is an established trend occurred in the last years, in which Europool tyre producers have seen their market share eroded by asian producers, that have used the price as a main marketing weapon in order to gain european presence.
Truck Tyre import from China in volume (pieces) and Value (mln€). Source: Eurostat
This phenomenon becomes very interesting in the moment in which we analyze the import split by EU Country, in order to understand which are the Countries that see the major inflow of goods from China, and how the volumes have evolved in the last years.
If we have a look to the yearly trend of volumes for some relevant countries, we immediately see the impressive growth of Poland. Look at the chart: 10 years ago Poland was substantially not importing Chinese tyres, but since then it began a massive volume increase.
Truck Tyre import from China in volume (pieces). Source: Eurostat
In 2016 Poland results to be the third “door” for Chinese goods, after UK and Germany, before Italy and Spain. The Top 5 Countries, altogether, account for a 62% of total imports in volume.
Truck Tyre import 2016 from China, % in volume (pieces). Source: Eurostat
If we trace a radar chart with the evolution of the yearly country ranking, it’s more easy to identify the key trends by Country:
- Poland was not even in the Top 7 EU importer countries in 2006, while growing up to being the third in 2016
- Netherlands was the first importing country in 2006 and still goes on importing a relevant quantities of goods, but it has not grown in line with the overall European imports, therefore losing positions in the ranking. In 2016 it is the 6th, within the Top importing countries.
- UK and Germany have been top importers after Netherlands in the past; recently they have definitively taken the 1st and 2nd position in the ranking.
- Uk in particular has a specific role within the EU macrosystem, due to the fact that it is a main economy without Euro currency, and therefore subject to the effect of the GBP exchange rate dynamics, which can substantially influence the trade of goods. Additionally, the recent Brexit vote has generated effects that cannot be estimated yet, both at macro level on the whole UK economy and at the level of the specific Tyre sector.
Truck Tyre import from China, ranking evolution in volume (pieces). Source: Eurostat