31 August 2016 - page 1 of 20© 2016 Shaw Information Services Ltd R E S E A R C H

R E S E A R C H

Compiled by Shaw Information Services trading as Tire Industry Research© 2016 Shaw Information Services Ltd

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Global Tire Intelligence reportDateline: 31 August 2016

The newsletter contains information about the global tire industry. The information is provided in good faith, but it is not advice, and should not be treated as such. Without prejudice to the generality of the foregoing paragraphs, we do not represent, warrant, undertake or guarantee that the information in the newsletter is correct, accurate, complete or non-misleading.We will not be liable to you in respect of any special, indi-rect or consequential loss or damage.

ContentsWhat’s different about China 2Chinese car owners don’t know their tires 2Do Low Rolling Resistance Tires Improve Fuel Economy? 2

About this publication 2

US hits Chinese truck tires with more duties 3Dumping duties weigh on China’s tire makers 3

First half results 4Top Tire makers H1 2016 4

Section 3: Investments and closures 5SRI adding capacity at Tonawanda factory 5Yokohama looking at $5.8m tech centre in USA 5BRISA raises USD310m to aid expansion plans 5Michelin breaks ground on huge Mexico plant 5Michelin plans to invest in UK, despite Brexit 5JK Tyre to set up R&D centre in India 5Orion to close carbon black plant in France 5Tanzanian government plans new tyre factory 5Bridgestone to add PCR/LT capacity in Quebec 5Bridgestone enters Indian bike tyre segment 5BKT tyres enters two-wheeler tyre market 5TVS Srichakra unveils two wheeler radial tyres 5Continental signs option for extra land at Hefei 5Goodyear to build $162m aviation tire factory 5Yokohama to hit 89m unit/year by 2020 6Michelin buys Brazil’s bike tire maker, Levorin 6Firestone Tyres now in India 6JK Tyre is looking to enter aviation market 6

Section 5: Legislation and government 6Michelin claims it has settled trademark case 6

Section 6: New business models 7Will an autonomous car ever be able to turn? 7IAA says trucks are becoming data carriers 7

Section 7: Upstream and raw materials 7Zeon, Sumitomo to merge S-SBR business 7

Section 9: Company information 8Sentury close to site selection for US factory 8Conti sets up TKS research facility in Germany 8Pirelli launches dedicated site for Calendar 8

What makes a tire ‘green’ 9

What happens when rubber meets the road? 10

Japan Tire Industry 11Production of automobile tyres and tubes 13Domestics shipment of automobile tyres and tubes 14Export shipment of automobile tyres and tubes 15Exports of tyres and tubes 16Exports of tyres and tubes 17Imports of tyres and tubes 18Sales of original equipment tyres 19Replacement sales of summer tyres and winter tyres 20

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their children and wife. If they know something about your brand, they might be prepared to put your tires on their car.

Do Low Rolling Resistance Tires Improve Fuel Economy?The US Consumer Reports organisation has tested tires to see if the claims of low rolling resistance really do result in better fuel economy. The answer? Yes, but not as much as you might expect and the benefit from reduced rolling resistance can be easily out-weighed by poor inflation or aggressive driving styles.The Consumer-focussed organisation took the most fuel-efficient tire it could find (Hankook Ventus S1 noble 2) and compared it with the worst it could find in the same size (225/40R18). In this case, the worst tire was a Kumho ECSTA PS91. The Kumho records a massive 31.8% greater rolling resistance than the Hankook.After testing the real-world highway fuel economy of a car (Scion FR-S) fitted with one set of tires and then the other set, CR observed a 5.7 percent improvement in fuel economy.

CommentaryMost observers suggest that at highway speeds, rolling resistance within tires contributes around a quarter of the friction losses in a car. There is also an informal guide (called the 1:6 rule) that suggests a 6% reduction in rolling resistance delivers a 1% reduction in fuel economy. The two tires tested are consistent with this 1:6 rule.When we look at the EU label, the minimum grade (G) corresponds to a rolling resistance coefficient of 12 while the maximum grade corre-sponds to a RRC less than or equal to 6.5.There is a common assumption that moving from grade G to grade A (a 45% reduction in rolling resistance) will result in a 7.5% saving in fuel economy. Again, this is consistent with the 1:6 rule.However, rolling resistance is influenced by many things. The tread compound and tread pattern is just one of them. Tread depth is another. Deep tread blocks on a tire move around and this absorbs energy, so a new tire with 8mm tread grooves will almost always be less fuel-effi-cient than a used one with 2mm of tread. In fact, the saving due to tread depth almost completely cancels out the saving due to tread compound. This means a worn tire with grade G will often be more fuel efficient than a new tire with an A label.Another major factor is the inflation pressure. An under-inflated tire has much more rolling resistance than when it is properly inflated. http://www.consumerreports.org/tires/do-low-rolling-resist-ance-tires-improve-fuel-economy/

Chinese car owners don’t know their tiresJ D Power is a well-known analyst for the automotive sector. It carries out user satisfaction surveys of various aspects of the automotive trade, including tires. Researchers ask people who recently bought a new car about various aspects of that vehicle. The latest survey reports on owners of new cars in China and what they think about tires. This is the fifth year JD Power has carried out the survey.More than half of new-vehicle owners (57% for first-time owners and 50% for repeat buyers) don’t know the brand of their original tires. Furthermore, only 1% of owners say they know their tire features “very well” and 9% say they know them “somewhat.” Such severe lack of knowledge leads to significantly lower levels of satisfaction and loyalty. Satisfaction averages 719 (out of a possible 1000 points) among owners who say they know their tires “very well,” compared with 652 among those who say they do “not at all” know their tires. Among owners who claim to know their tires very well, 44% of them say they “definitely would” recommend the same brand to others and 31% say they “definitely would” repurchase the same brand as replacement tires; among owners don’t know their tires at all, only 15% “definitely would” recommend and 20% “definitely would” repurchase the same brand. Goodyear ranks highest in the luxury car segment for a third consecutive year, with a score of 759. Michelin ranks second (736).Nexen ranks highest in the mass market car segment for a second consecutive year, with a score of 742. Michelin ranks second (706) and Kumho third (704).Goodyear ranks highest in the SUV segment for a third consecutive year, with a score of 738. Michelin ranks second (727) and Pirelli third (698).Maxxis ranks highest in the MPV/ mini van segment for a third consecu-tive year, with a score of 658. Giti ranks second (640).The 2016 China New-Vehicle Tire Satisfaction Index Study is based on responses from 16,010 vehicle owners who purchased their vehicle between October 2012 and May 2015 and examines 37 tire brands. The study was fielded from October 2015 through May 2016 in 57 major cities in China.

CommentaryPublic awareness of tires in China is lower than almost any other country with a large consumer base. This is good for International tire makers, but bad for Chinese tire mak-ers. The reason it is good for the brand-names is that most cars in China come with Non-Chinese tires as the original fitment. Those that come on Chinese-brand tires tend to be at the low end of the performance and

About this publication

What’s different about Chinaprestige spectrum.Western tire makers have been very keen to win OE fitments in China, while the desire to get OE fitments in other markets, such as Europe has declined.If you are a Chinese who bought a premium vehicle a year ago and now need to replace tires, there is almost no information about the different tires available to Chinese buyers. The only information to guide a purchase is the tires fitted as new.Among premium tire makers, the secret of success in China is this igno-rance. It means that car owners will very often replace the worn-out tires with the same brand and model, and the tire supply can make good profit on this deal.The influence of the original tires on the replacement purchase is called pull-through.Pull-through on premium vehicles in China is higher than almost anywhere in the world. This means the suppliers of tires to those premium vehicles can charge higher prices on the replacement products. Chinese tire makers can fight this arrangement by offering more informa-tion about tires and why certain brands are better than others. If consum-ers have no information about your brand, they will not risk the lives of

This document has been prepared in response to demands from the global tire community for insight into the global tire industry – and especially Europe.

Our company tracks the tire industry around the world. We publish a weekly report that gives Western executives deep insight into current developments in China’s tire industry.

Part of that research involves tracking the China-based publications that report on the global tire industry. We noticed that Chinese reporting of Western developments is woefully inadequate.

During conversations with many Chinese people, we identified a strong need in China for a source of information on the global tire industry that lies outside of the official channels.

Furthermore, in conversations with industry analysts, we identified a need for a short-form document that explains and analyses latest devel-opments in the global tire industry.

About the author. This report is compiled by David Shaw. Mr Shaw publishes widely on LinkedIn about the tire industry. He has a 30-year track record reporting on the global tire industry at the highest levels. He publishes market research reports; offers a weekly news service and manages conferences globally.

For more information see http://TireIndustryResearch.com

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Few of us have the right connections or understanding of the Chinese processes to understand how those subsidies are brought into play.

I hear rumours from friends in the industry that when a country such as the United States imposes trade barriers, some or all of those tariffs can be claimed back from the government.

I also hear rumours that local governments will pay factory owners to move a factory from a residential district to a new industrial zone on the grounds that it is reducing pollution or environmental emissions and simul-taneously creating local jobs.

We repeatedly report on new projects supported by the MIIT or other ministry under which a special status is given and that status affords tax breaks, or grants from government to help set up a new facility.

Some will argue that this is no different from the subsidies offered by North Carolina or Georgia to attract a factory and its associated employ-ment options and general economic benefits. At first sight, that is correct, but the difference is in the scale of the subsidies.

A US State might offer 10-20% of the costs in subsidies, but one hears persistent rumours from multiple sources –never officially confirmed – that the entire cost of a Chinese factory might be provided by a local government in order to move it from one zone to another. Some of that is offset by land use permissions and conversion from industrial to residential usage; some is offset by taxes; some is offset by other mechanisms.

Some of those mechanisms might be seen in the West as corrupt payments, but in China where codes of honour are different, it is simply the way of doing business, where some backs get scratched and some gifts are exchanged and the relationship between powerful men is further strengthened.

And this highlights one of the key aspects of doing deals between West-erners and Chinese. Transparency and clarity of the information provided.

Westerners seek transparency and clear information about what is being exchanged and the outcomes for both sides.

Rarely is this available in China where honour and trust will bring their own rewards, but very rarely will those rewards be spelled out at the point of agreeing a deal.

Returning to the point of this - we know that exports of truck tires from China are triggering anti-dumping investigations around the world.

This surely cannot be a coincidence. There is no doubt that the US attitude contrasts strongly with that of the EU, where tire makers brought a com-plaint earlier this year, triggered by the plight of independent retreaders ad the EU rejected it, claiming that the profitability of tire makers in the EU has improved, so there can have been no damage.

That improvement in profitability is derived largely from reductions in input costs, such as natural rubber. Tire makers will not always have that advantage.

• Commerce determined a preliminary dumping margin of 22.57 percent for all other producers/exporters in China that are part of the China-wide entity due to their failure to respond to Commerce’s requests for information.

All these tariffs are set retroactively to be in force from 90days prior to publication in the federal register, expected on or before 1 September. This means the new tariffs will apply from 3 June, or thereabouts.

This is a preliminary finding and companies may submit further evidence to Commerce ahead of the final determination, expected on or before 17 January 2017.

Tariffs add to Countervailing dutiesThese new tariffs add to the countervailing duties Commerce announced at the end of June.

Preliminary countervailing margins (June 2016)Country Exporter/Producer Subsidy Rates

China

Double Coin Holdings Ltd. 17.06%

Guizhou Tyre Co. Ltd. 23.38%

All Others 20.22%

The two investigations are linked, though the timescales are different.

Commerce expects to publish its final determination in the countervailing case around 9 November, a couple of months earlier than in the dumping investigation.

The combined impact of the ‘dual’ duties is as follows.

Combined “dual” duties (Aug 2016)Country Exporter/Producer ‘Dual’ Rates

China

Prinx Chengshan (Shandong) Tire Co., Ltd. 41.09%

Double Coin Holdings Ltd. 39.63%

Guizhou Tyre Co. Ltd. 45.95%

All Others 42.79%

CommentaryAs a corporate entity, we believe in free trade and, in general, think that trade barriers are counter-productive.

In the case of the China tire industry, it is very difficult – almost impossible – for a Westerner to understand the level of subsidies that exist within the Chinese tire industry.

Dumping duties weigh on China’s tire makersIt was widely expected, but never welcomed. The United States Depart-ment of Commerce announced that it has imposed anti-dumping duties of around 20% on imports of truck and bus tires from China.

This adds to the anti-subsidy (countervailing duties) –also of around 20% – imposed in late June of this year.

The US Commerce Department issued a fact sheet on 29 August indicating that it believes Chinese tire makers are dumping truck and bus tires in the United States, and this practice is causing damage to the domestic manufacturers.

Preliminary anti-dumping margins (Aug 2016)Country Exporter/Producer Dumping Rates

China

Prinx Chengshan (Shandong) Tire Co., Ltd. 20.87%

Non-Selected Separate Rate Respondents 20.87%

China-Wide Rate 22.57%The approach in the United States is to identify a limited number of importers that might be considered to be representative of the class of companies under investigation and require those companies to supply information about pricing, costs, volumes, profits and other details.

These are called the mandatory response companies

Commerce then uses this data to assess the extent of dumping at the Mandatory response companies, and then extrapolates to assess the extent of dumping from other companies, and in this case, assigns a China-wide rate to all other companies.

Those other companies can voluntarily supply information to Commerce to demonstrate that their circumstances are different from those of the mandatory respondents and request lower duties. These are included in a group of ‘Special Rate’ companies with individually-tailored tariff rates.

In its factsheet, Commerce said its preliminary findings are that:

• Dumping has occurred by mandatory respondent Prinx Chengshan (Shandong) Tire Co., Ltd. at a preliminary dumping margin of 20.87 percent.

• The other mandatory respondent, Double Coin Holdings Ltd. is not el-igible for a separate rate and is part of the China-wide entity. We are led to understand that Double Coin did not cooperate with Commerce Department.

• Commerce assigned the preliminary margin of 20.87 percent, to the non-selected respondents eligible for a separate rate.

US hits Chinese truck tires with more duties

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Top Tire makers H1 2016 CompanyTire sales H1

2016Tire sales H1

2015Multiplier

Net profit H1 2016

Net profit H1 2015

MultiplierNet margin H1 2016

Bridgestone $14,732m $15,431m 95.5% $1,104m $1,203m 91.7% 7.5%

Michelin $11,484m $11,717m 98.0% $858m $789m 108.7% 7.5%

Goodyear $7,570m $8,196m 92.4% $386m $416m 92.8% 5.1%

Continental Co $5,808m $5,653m 102.8% $720m $674m 106.8% 12.4%

Sumitomo $3,343m $3,234m 103.4% $251m $166m 151.2% 7.5%

Pirelli $3,312m $3,547m 93.4% $9m $219m 4.1% 0.3%

Hankook $2,836m $2,826m 100.4% $475m $368m 129.1% 16.7%

Yokohama $2,399m $2,464m 97.3% $74m $135m 54.6% 3.1%

Cheng Shin Rubber

$1,842m — — $245m — — 13.3%

Zhongce — — — — — — —

Toyo $1,668m $1,617m 103.2% $19m -$35m -55.7% 1.2%

GiTi Tire — — — — — — —

Cooper $1,390m $1,414m 98.3% $130m $102m 127.5% 9.4%

Kumho $1,224m — — $472m — 38.6%

Triangle — — — — — — —

MRF $1,161m $1,141m 101.8% $140m $129m 108.0% 12.0%

Apollo Tyres $937m $814m 115.1% $84m $74m 113.1% 9.0%

Nexen $805m N/A N/A $108m $0m 13.4%

Sailun Jinyu $788m $742m 106.2% $31m $17m 180.8% 3.9%

Linglong $725m $692m 104.9% $85m $6m 1387.7% 11.7%

Nokian $684m $700m 97.8% $113m $223m 50.6% 16.5%

Titan $652m $778m 83.8% -$12m $10m -114.7% -1.8%

Xingyuan — — — — — — —

JK TYRE $511m $516m 99.1% $32m $36m 90.6% 6.32%

AEOLUS $437m $539m 81.0% $22m $24m 92.0% 5.0%

First half results (provisional)We have looked at the half-year results of the top tire makers. One of the most obvious aspects of these results is falling tire prices. This might have been expected in previous quarters or half-years, but for the first time since 2011, input costs have been rising among tire makers, while selling prices have been falling.

The only companies in our list to have increased sales in the first half over the same period last year are Continental, SRI, Hankook, Toyo, MRF, Apollo, Sailun-Jinyu and Linglong.

The increase at SRI has provisionally placed it above Pirelli in the ranking this half. Hankook’s increase also placed it in 7th position above Yokohama.

We expect this trend of falling prices to continue, while input costs are expected to stay constant or possibly edge up somewhat in the next six months. This means margins will be under pressure in the second half of the year.

Another aspect of this year’s results is the change in exchange rates. We rank the companies in terms of US dollar sales, using average exchange rates over the relevant period to convert each company’s sales. The Jap-anese yen strengthened by around 7.5% against the US dollar in the first half of 2016 compared to the prior year and the Korean Won strengthened by 7%. Meanwhile the Euro is essentially unchanged while the Chinese RMB has weakened by a little over 6%.

Bridgestone’s sales fell by 11% in the reporting currency (JPY), but this is mitigated by currency effects to under 5% in dollar sales.

Linglong’s sales grew by 11% in RMB terms, but our table shows only a 5% gain after converting to the US Dollar.

Profitability was also affected by the same currency effects, but Bridgestone remains top of the pile by a long way, despite a 8% decline in dollar-based profits.

Profitability can swing a great deal, especially if the prior year was particu-larly bad. Nevertheless, we have to point out Linglong’s improvement with more than 10-fold improvement in profit. Other companies who registered strong profit growth include Pirelli Hankook and Toyo.

When we compare net profit margin, Hankook, Nokian, Continental and Linglong all reported double-digit margins.

In many ways, this is the most important marker of management quality. Achieving good margins depends on selecting the right markets to com-pete; identifying high-profit niches and controlling costs.

Each of these four companies is managing these processes well. At the cheaper end of the spectrum, Linglong is making substantial progress on managing its costs in both China and Thailand while Nokian, with slightly lower turnover operates in high-margin niches, such as premium Winter tires and forestry tires.

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Section 3: Investments; additions and closures

SRI adding capacity at Tonawanda factorySumitomo Rubber Industries (SRI) is planning to invest USD87m capacity at its tire factory in Tonawanda, New York State. SRI makes tires under the Dunlop and Falken brands for sale in North America at the factory. The company will double the site’s production capacity for car and light ruck tires to 10,000 units a day by the end of 2019. The investment is especially focussed on tires for SUVsSRI also makes trucks, buses and motorcycles at the factory.

Yokohama to invest $2.7m in US Tech centreYokohama has announced a plan to build a $2.7m tech centre in Cabarrus County, North Carolina. The company will invest nearly $2.7 million on the Centre over three years, creating up to 56 jobs in the process.R&D activities are expected to start as early as September 2016, and the centre is expected to consolidate Yokohama’s R&D activities in North America, which currently take place across a number of sites.The new centre initially will engage in the design of new tires for passen-ger cars and other consumer applications, but will gradually expand its activities to include testing & evaluation.

BRISA raises USD310m to aid expansion plansBRISA, the Turkish joint venture between Bridgestone Corp. and Hacı Ömer Sabancı Holding (Sabanci), has arranged loans worth USD 310m to fund an expansion project. The loan is to support Brisa’s new greenfield plant in Aksaray province, Turkey. It will produce tires for passenger cars and light commercial vehicles under the Bridgestone and Lassa brands.Part of loan proceeds will also help Brisa expand their production of truck and bus tyres at its Izmit plant in north-western Anatolia.Yigit Gürçay, CEO of Brisa, said; “Since the joint venture was formed in 1988, the total sum of investment we have made in Turkey has exceeded US$ 1 billion.”

Michelin plans to invest in UK, despite BrexitMichelin has said it will continue with a GBP15m investment at its factory in Dundee, Scotland.This phase of the project is designed to upgrade curing presses at the factory and is seen as the first phase in a potential GBP100m upgrade of the whole factory.The Dundee factory has capacity for around 7 million car and light truck tires annually.The investment plan was announced at the same time as Michelin an-nounced the closure of its truck and bus tire factory in Ballymena, northern Ireland.

Michelin breaks ground on huge Mexico plantMichelin Group has broken ground at its 69th global tire factory in León, Guanajuato, in central Mexico.The new plant will include covered areas of around 142,000 square meters (213 mu) on approximately a 98 hectare parcel of land (1470 mu) in the Parque Industrial León-Bajio. The plant represents Michelin Group’s largest global investment for 2016, approximately €450 million (US$510 million).The factory is expected to be on stream in late 2018. Production will increase gradually thereafter, eventually reaching 4 to 5 million tires a year, primarily under the Michelin brand for high-performance and ul-tra-high-performance cars, light trucks, SUVs and cross-over vehicles. The plant is expected to employ at least 1,000 people at capacity.

JK Tyre to set up R&D centre in IndiaIndian Tire major JK Tyre and Industries Ltd is to invest INR1000m (USD 14.9m) to set up a technical centre in Mysuru, India.The centre will consolidate all JK Tyre’s R&D activities under one roof. It will initially have about 200 engineers and scientists doubling to 400 after one year.

Orion to close carbon black plant in FranceOrion Engineered Carbons S.A. is to cease production of carbon black at its French subsidiary, Orion Engineered Carbons SAS by the end of 2016.The Orion plant in France employs approximately 40 people and has a carbon black production capacity of up to 45kt per year, predominately used in the production of tires and other rubber goods.

Tanzanian government plans new tyre factoryThe government of Tanzania has said it intends to build a new tire factory in the African country. One tire factory already exists in the country under the name of General Tire East Africa (GTEA), but this uses out-dated equip-ment and has only been operating sporadically. Dr. Adelhem Meru, a senior official with Tanzania’s Ministry of Industry, Trade and Investment said the new factory will not replace GTEA. “We are planning to build new tyre factory using latest technology to make tyre products that will compete in the present market,” he said.In 2012, the government pledged to inject 20 million US dollars to make GTEA start operations but the deal was not realised.

Bridgestone to add PCR/LT capacity in QuebecBridgestone Americas Inc. is planning to invest Can$300m (US$250m) at its car and light truck tire factory in Joliette, Quebec. The project is de-signed to increase capacity by nearly 18 percent to 20,000 units a day by 2023. Bridgestone expects to begin the first phase of the project later this year. The whole project is focused on new capacity for tires in rim sizes from 18- to 22-inches. The expansion will increase the size of the plant to 10.5 ha (15 mu) total.

Bridgestone enters Indian bike tyre segmentBridgestone is entering the hotly-contested two-wheeler tire market in India with the Neurun brand. Two-wheeler is the dominant segment in the Indian automobile market in terms of volume sales. The two-wheeler category is growing at CAGR of 8.5% in India with an estimated 150 million number of two-wheelers on the road.

BKT tyres enters two-wheeler tyre market Indian tyre manufacturer Balkrishna Industries, also known as BKT, is entering India’s booming market for two-wheeler tyres with the launch of two new products – BK Pilot and BK Raftar.BKT is best known for truck and agricultural tires.India’s two-wheeler tire market is growing at around 8.4% annually. In 2015 the total market was estimated as 84m units/year split between OE at 48m and replacement at 36m unit/year.

TVS Srichakra unveils two wheeler radial tyresIndian tire maker TVS Sri Chakra has unveiled a new range of two wheeler tires for bikes with engines of 150cc and above, under the name of Protorq.TVS Srichakra is a part of TVS Group. It is engaged in the manufacture and sale of two and three wheeler tyres and tubes having a turnover of more than $300 million.

Continental signs option for extra land at HefeiContinental on 1 August signed a long-term option to purchase additional land at the company’s Hefei tire plant in China. If fully exercised, the move would almost double Conti’s area at the Hefei facility.With this additional investment of EUR 250 million, the stage is set for further expansion phases that will take annual output as high as 14 million units. At the same time, expansion of bicycle tire production to 13 million units a year by 2025 is underway. Continental opened the tire plant in Hefei in 2011. Since then, the compa-ny has increased its annual passenger car and light truck tire production capacities to approximately five million units. Continental has scheduled total investments of more than EUR 500 million at the Hefei plant.

Michelin buys Brazil’s bike tire maker, LevorinMichelin Group has acquired Levorin, a Brazilian manufacturer of bicycle and motorcycle tires.This family business which was founded in 1943 by Hercules Levorin has specialized in the production of tires for the commuter segment in Brazil. In 2015 Levorin had an annual turnover of €135 million and employs 2,000 people at its two plants in Sao Paulo and Manaus.The offer to purchase was signed on 26 August between Levorin and Michelin, and is subject to closing conditions and also subject to the approval of the Brazilian competition authorities.

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Section 5: Legislation and government

Michelin claims it has settled trademark caseMichelin North America, Inc., said it has reached favourable settlement agreements with Atturo Tire Corporation and Svizz-One Corporation Ltd., regarding its patent infringement suit it filed on May 13 in U.S. District Court for the District of South Carolina in Greenville, S.C. The Michelin suit alleged that Atturo Tire Corporation and Svizz-One Corporation Ltd. infringed design patent U.S. D483,322 covering the Michelin® Latitude® Tour tread design.The parties agreed not to disclose specific terms of the settlement.

CommentaryIncreasingly, Western tire makers are taking to law courts to protect their intellectual property. The argument is to prevent confusion in the minds of customers. If Michelin has developed a tread pattern, many consumers might see that pattern and associate it with the brand values of Michelin. When another tire maker copies the pattern, they gain many of the bene-fits of that brand association. If the tire then does not perform as expected, the Michelin brand image suffers. As a result, all the top brands are getting more concerned about copying of tread patterns.http://michelinmedia.com/pages/blog/detail/article/c6/a518/

Goodyear to build $162m aviation tire factoryGoodyear Thailand Pcl said it plans to invest $162 million to build a new radial aviation tire factory to expand production at Phathumthani, north of Bangkok, to meet growing demand in Asia Pacific.The first phase of the three-phase expansion is targeted to begin opera-tions by 2018, O’Connor said.The expansion will help the tire maker capture growing demand for radial tyres as commercial airlines are rapidly converting their fleets to radial tires from bias tires, Managing Director Finbarr O’Connor said in a statement.The Thai unit, 66.8 percent owned by U.S.-based Goodyear Tire & Rubber Co, provides original equipment and replacement tires for passenger cars, commercial trucks and retread tyres for domestic sales and exports.

Yokohama to hit 89m unit/year by 2020Yokohama Rubber Co. Ltd. plans to lift its global production capacity of tires by the end of 2020 to 89 million units per annum, CEO Hikomitsu Noji recently announced.At the end of 2015, the company had an annual production capacity of 70.59 million units and has planned for 72.14 million units for the end of 2016, 74.19 million units for the end of 2017 and 74.69 million units for the end of 2018. The rise in production capacity between the end of 2018 and the end of 2020, however, will be some 15 million units – approxi-mately a 20 percent jump.Much of the growth is expected to come from OE sales. Yokohama plans to increase its OE sales in 2020 to four times its volume in 2014.

Firestone Tyres now in IndiaAmerican tire brand, Firestone Tires has entered the Indian market with its products for the passenger vehicle space. A subsidiary of Bridgestone, Firestone now offers two products for the small & medium cars and the SUV segment in India.The Firestone FR500 and the Firestone Destination LE02 have been introduced in the country, starting from sticker prices of Rs. 2,200 and Rs. 5,500 per tyre respectively.The tyres will be available through Bridgestone dealers across the country and these are being produced at company’s plant in Pune and Indore.

JK Tyre is looking to enter aviation marketIn an interview with a local journalist, Dr. Raghupati Singhania, chairman and managing director, JK Tyre discussed a wide range of topics and challenges, including the threat from the dumping of Chinese products.Asked about aviation tires, he said, “We are working towards that direction as it’s a very lucrative segment. Though at present I cannot comment more on it as plans are still being worked out and things are still taking shape. But one thing is sure - we cannot ignore the segment as its going very strong and offers a lot of opportunity for growth.”Asked about Chinese tires, he said, “Dumping of China-made tyres is a severe problem engulfing the Indian tyre market. Last year there has been more than 50% increase in the Chinese tyre dumping in the Indian market. Chinese tyres are about 25-30% cheaper than the Indian ones. In some instances, they can be even 40% cheaper. “At the collective level, we have also approached the central government to intervene and stop the dumping of Chinese tyres. It has been over 16 months but so far we have not seen much action on the ground by the government. In contrast, it takes just 45 days to complete the same process in a country like the US.”

Section 3: Investments; additions and closures

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Section 6: New business models

Will an autonomous car ever be able to turn?It’s not a technical issue, but a psychological one. Those of us who live in Shanghai, Bangkok, London or New York know that turning out of a junction onto a main street often requires cooperation with other drivers. You force your way out, or catch their eye and they let you out.Imagine how you might behave when there are cars driven by computers. We know that they will stop rather than have an accident, so maybe we will deliberately turn out in front of them. We know that they will not be aggressive, so maybe we will not let them out of a junction when we would do that for a human driver.Or maybe we will see that they set a good example and learn to avoid all those bad habits we pick up, like speeding, failing to signal or cutting in when we should not.Goodyear is working with the London School of Economics researchers to understand more about how human drivers might behave when they share the road with computer-guided vehicles.According to a 2015 Goodyear/LSE survey of drivers from 15 European countries, 88 percent of respondents agreed that there are “unwritten rules” that govern driver interactions with pedestrians, cyclists and other vehicles on the road.“The questions raised in our focus groups suggest that drivers’ inter-actions with autonomous vehicles will develop as we are increasingly exposed to them,” said Dr. Chris Tennant, who is leading the research project at the LSE. http://news.goodyear.eu/latest-news/all/will-self-driving-cars-be-bul-lied/s/20d3c585-19ca-4e60-8b4b-3d2a1c69b912http://www.lse.ac.uk/newsAndMedia/news/archives/2016/08/WillSelfDriv-ingCarsBeBullied.aspx

IAA says trucks are becoming data carriersThe Frankfurt auto show scheduled for this September will show how trucks and other commercial vehicles are being transformed by digital technologies.One of the key trends in the automotive industry is the transition to a digital economy. This is not just about buying and selling goods online, but about using vehicles – and even tires – as digital platforms to acquire data and use it to improve business efficiency.The 66th IAA Commercial Vehicles will be opened by Federal Transport Minister Alexander Dobrindt on September 22. https://www.vda.de/en/press/press-releases/20160803-wiss-mann-iaa-commercial-vehicles-as-platform-for-digital-transformation.html

Section 7: Upstream and raw materials

Zeon, Sumitomo to merge S-SBR businessZeon Corp and Sumitomo Chemical company are discussing the merger of their respective Solution-SBR businesses. The two companies will look into forming a new joint venture company and expect to transfer their current S-SBR operations, including those of their respective subsidiaries, to the new company with the aim of strengthening the S-SBR business. This new partnership will accelerate new product development, enhance cost competitiveness and secure a stable product supply.The two companies expect to complete due diligence by September and sign agreements by the end of this year. The new company is likely to be formed around April 2017.

CommentaryNeither has a large business in this area. Sumitomo has capacity for around 50 kt annually and Zeon has capacity for 90kt/year.The Sumitomo capacity is made up of a small 10kt in Japan and a 40kt factory in Singapore that opened in March 2014. The status of the small Japanese line is unclear. It is not listed in the IISRP directory and the size suggests it is more of a pre-production unit than a full-scale production environment.Zeon’s capacity is made up of a 55kt/year unit at the company’s Tokuyama facility in Japan and a new 35kt/year unit in Singapore, that has been on stream since April 2014. The Singapore unit was originally intended to expand to 70kt by 2016, but this has been delayed due to over-capacity in the industry. In November 2015, Zeon has said construction of the second phase was expected to finish in February 2016 with commercial produc-tion beginning in April 2016. The company has not released any state-ments saying the plant is on stream. In its annual results for the year to April 2016, the company made projections of lower sales in the Elastomer business for the 12 months to April 2017. If the plant had come on stream, the projections should be higher due to the additional volume coming out of the new factory.Japanese-developed S-SBR is regarded as the best in the world for making tires. Solution-polymerised SBR (S-SBR) differs from the older emulsion-polymerised SBR (e-SBR) in that the polymerisation process can be controlled much more accurately to make specific morphology (shapes) of molecule: either long and straight, or with controlled branching.In addition, advanced materials can add functional groups on the mole-cule. Depending on the chemistry, these can be designed to engage with particles of silica or other fillers to improve rolling resistance.Solution-polymerised SBR is one of the most critical materials for ad-vanced, ‘green’ tires. http://www.zeon.co.jp/press_e/160804.html

http://www.sumitomo-chem.co.jp/english/newsreleases/docs/20160804e.pdf

31 August 2016 - page 8 of 20© 2016 Shaw Information Services Ltd R E S E A R C H

Conti sets up TKS research facility in GermanyContinental has announced plans to build a new R&D unit in Anklam, Germany, dedicated to the commercial development of rubber from a particular species of dandelion, known as TKS (Taraxacum kok-saghyz).The company plans to invest around EUR35m by 2021 and create 20 jobs.If the research phase is successful, Conti will add a processing facility to supply industrial quantities of the new material.Conti uses the brand name Taraxagum for this material. The name is based on the Latin name of the plant.

CommentaryTKS is seen as one of two potential substitutes for natural rubber. The other is Guayule.Most tire companies have realised that natural rubber presents a business risk to their activities. Either the rubber will run out, or it will become too expensive, or there will be pressure to restrict the amount of land given over to growing rubber.Conti’s approach is to work with the gene researchers at a German research lab called Fraunhofer Institute with the aim of improving the yield and robustness of the plant. While conventional natural rubber trees grow only in tropical climates, TKS can grow in temperate climates. This makes it attractive to tire makers based in the temperate regions. The main weaknesses of TKS is that first, it is a close relative of Taraxa-cum officinale. The common dandelion is a vigorous plant that will grow in many places. TKS is much less vigorous and there is a risk that fields dedicated to TKS will be invaded by the more common and more vigorous Taraxacum officinale. A second weakness is that the yields are relatively low, so that a lot of land is needed to produce the same amount of latex.A third weakness is that the latex coagulated immediately on contact with the air, making it difficult to harvest.http://www.continental-tires.com/car/media-services/news-room/20160812-new-research-facility-for-natural-rubber

Pirelli launches dedicated site for CalendarPirelli has created a site dedicated to its famous calendar. Historically the Calendar features naked and semi-naked women, and occasionally men. From 2016 the company adopted a new approach celebrating the achieve-ments of women. The new site offers a preview of the 2017 Calendar, that appears to adopt the same trends, featuring well-known movie actresses such as Kate Winslet, Dame Helen Mirren, Uma Thurman and Nicole Kidman.

Sentury close to site selection for US factorySentury Tire is on the point of selecting a site for a large tire factory in the United States. There have been a series of reports in the US press suggesting that Sentu-ry has been investigating sites in Tennessee and in Georgia. Six months ago a former Nokian engineer who has been recruited by Sentury said it is his job to select a site and plan a factory.http://www.jacksonsun.com/story/news/local/government/2016/07/29/chinese-tiremaker-sentury-finalist-megasite/87662954/

CommentaryMost tire factories in high-cost countries exist primarily to serve the vehicle makers. Clearly it is more expensive to make tires in high-cost countries, compared with low-cost ones. For better or worse, most vehicle factories are still located close to the demand – and the demand tends to be in high-cost countries.The vehicle makers demand close support from all their suppliers. That means short logistics chains as well as technical, engineering and testing support. As a result, the premium tire brands have factories, technical centres and testing tracks located in high-cost regions. It helps that there is a high density of tire development engineers in certain locations around the world, almost all of which are in high-cost countries. Of these, there are two key locations: Akron, Ohio (United States) and Hanover, Germany.Historically, an Asian tire maker who wishes to move along the path toward supply contracts with premium-name vehicle makers will often begin by setting up a test centre to compare its own tires with those from other manufacturers. We have seen this kind of development from many Chinese tire makers.After a number of years, that develops into a technical development centre with a few engineers. Historically, it is only after years of building relation-ships and developing technologies that new tire makers set up factories in high-cost countries. And it has always meant that the tire maker is close to winning supply contracts with vehicle makers. This is the case with GiTi, Hankook and Yokohama, all of whom are setting up new factories in the United States.With Sentury it is different. We hear rumours that Linglong, Triangle and other Chinese tire makers are planning factories in the United States, but none of these is anywhere close to winning large supply contracts with the vehicle makers.The justification for these plans is to avoid tariffs from the US government.

Section 9: Company information

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recovers. With each cycle, some energy is converted to heat, and this cannot be recovered.

Improving the ingredientsTire makers have spent a great deal of time and effort to find new ingredients – especially if they can be described as naturally-sourced – to use in tires. These include orange oil, starch, silica from rice-husk ash, bio-polymers and suchlike. There is a trend to switch away from natural rubber from the rubber tree, hevea, Brasiliensis into other plant species that produce natural rubber such as guayule and Kazakh dandelions. This is partly based on the intransigence of the NR producers; partly on price volatility and increasingly now, based on land usage change from natural forest to rubber plantation.

With these new ingredients, increasingly there is a demand for them to come with documents that prove ‘green’ credentials.

Need for documentationA new requirement is emerging. In May 2016, a meeting in Singapore between tire makers, rubber consumers, rubber producers and Civil Society groups underlined the extent of de-forestation in the Mekong basin around Cambodia, Laos and southern China. Although the tire industry is not directly responsible for this de—forestation, it is seen as a major customer of the rubber growers, and therefore indirectly responsible for the de-forestation.

Following the Paris agreement and other international agreements on de-forestation, all companies that take seriously their CSR responsibilities will have to look at how their rubber is sourced and whether there is any material from land that has been, in recent history, virgin rainforest.

Michelin is the first of the tire makers to commit to 100% sustainable sourcing of natural rubber. It is likely that others will follow suit in the near future.

Reducing rolling resistanceA full life cycle analysis on a car tire or a truck tire shows that the largest contribution to its environmental footprint over the full life cycle is from the energy consumed as the tire rolls during its lifetime.

Around 80% of the total energy footprint is related to this energy.

This is why a large part of the ‘green’ message associated with tires is about rolling resistance.

Tire engineers have a number of ways of reducing rolling resistance while at the same time maintaining life and grip.

Change the tread compoundThe first is to use a high-tech tread compound. In car tires, the aim is to control the hysteresis – often measured by using the loss angle (∂) and the tangent of that angle (tan ∂). At high temperatures (around 60°C), this parameter is associated with rolling resistance. But at low temperatures (0°C), it is associated with grip.

With conventional carbon black in natural rubber, there is often not much difference between the tan ∂ at these two temperatures, but when a combination of Solution-SBR and finely dispersed silica all reacted with an organo-silane are used in the compound, tan ∂ at 0° can be more than twice the same measurement at 60°.

Change the geometryA second method is to change the geometry of the tire

The ability of a tire to carry load depends on the amount of air in the tire. In general, more air means more load can be carried.

As you might expect the biggest tires for earthmover vehicles carry a lot of air. Equally, if you need to carry more load on a given size of tire, then you can pump more air in and it will usually be OK, within limits.

If we now look at the rolling resistance of a tire, that depends on shape. The most efficient tire is like a bicycle tire. A very large rim diameter with the narrow, near-circular section of rubber to carry the load. This is because the tire compresses a little in the contact patch. A given vertical distortion on a big diameter results in less compression of the rubber and therefore less energy wastage than the same distortion on a small diameter.

As a result there is a trend in some vehicles to move to tall, narrow tires

Change the internal constructionThere are other ways to improve rolling resistance. Rolling resistance occurs because energy is being wasted when the tire distorts and then

Within China, some people think to make a tire ‘green’ or environmen-tally-friendly you only have to meet the specifications of the various regulations such as the Green Tire specification (绿色轮胎技术规范) or the Tire Industry Policy (轮胎产业政策) or Access conditions (轮胎行业准入条件).

The view in the West is more complex. One key aspect is that the Chinese specifications are written down and static. The concept of a ‘green’ tire in the West is a moving target.

If the average label grade in a given size is (say) C, then a green tire would be either a B or an A grade. The aim is to get performance that beats the average, or the common state of the art. As the average performance level moves up, so does the expectation of a tire described as ‘green’ It is more of a market focus than a technical focus.

Extending that concept we can see that in China the concept of a ‘green’ tire is more or less a technical definition. In the West, it is a marketing concept. You can call anything a ‘green’ product. But there will always be journalists (and competitors) who will challenge any claims they believe to be false.

This is one of the reasons Western tire experts think Chinese tore makers need to get a better understanding of marketing. A simple technical de-scription will rarely help to sell more tires, but when the message is part of the marketing message, the aim is to sell more tires at better prices.

Technical factors

There are a range of technical factors that can help to make a tire green – in the marketing sense of the word. These include:• Rolling resistance / fuel economy• Life• Use of ‘green’ Ingredients• Energy consumption during manufacture• Carbon off-setting

However these technical factors are there to support the marketing mes-sage. In the marketing sense, they are features, rather than benefits. The corresponding benefits are as follows:• Save money on fuel bills• Save money by replacing less often• Helping to save the planet• Helping to save the planet• Helping to save the planet

The message coming out of a company that sells ‘green’ tires is that they are environmentally-responsible and are working with various agencies and governments to offer a range of products that are sourced, manufac-tures responsibly.

What makes a tire ‘green’

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road networks would find that data incredibly useful?

When I mentioned to the road industry that the tire and vehicle people are working on grip sensors and that the likely model is that the instantaneous levels of grip would be constantly uploaded to the cloud by millions of trucks and cars, their eyes opened wide.

Currently, they spend millions trying to identify areas where the road surface needs to be improved in order to prevent accidents and save lives. That limited information guides decisions about where to direct billions of Euro of annual road maintenance budgets. Budgets that are under severe pressure.

Imagine if they could have a database that identifies levels of grip across the entire road network, generated by sensors on tires from many different manufacturers and correlating that with the air temperature and even the road temperature.

It would enable road authorities to quickly identify area where the grip changes suddenly by location and also areas where the grip changes sharply according to different weather conditions.

Diminishing returns unless we talk to the road community

One of my mentors in this industry – Roger Williams, previously technical director at Dunlop UK – always talked about roads and tried to convince the tire industry to engage more with the roads community.

I find myself doing the same, but for perhaps different reasons.

It seems to me that tire development is suffering from the laws of dimin-ishing returns. As we work every harder to improve grip and noise, we find that our efforts deliver good results on one road surface, but make the situation worse on another surface. Working with the people who design, specify and buy road surfaces might be a way to direct those efforts more efficiently.

A final thoughtDid you know that in pre-history, the wheel was invented many times, but it never really took off as a practical device until the Romans built high quality roads. A wheel is not much use on soft ground or a ploughed field.

The development of wheels and tires is intimately connected with the de-velopment of good roads. Neither is much use unless the other is equally well engineered.

If anyone in the tire industry wants to learn more about roads, or if you are a road engineer and want to know more about tires, let me know and we will try to make something happen.

loads imposed by tires. All of these things affect grip and the interaction between tires and roads. The movement of particles within the road bitu-men will also have an impact on energy consumption and fuel economy.

Tire industry needs to understand road engineeringAs we get a better understanding of tires and their compounds, we are finding that we need to learn more about the road underneath the tire.

I wanted to work with the road industry for a number of reasons.

Significantly, the tire industry has worked very hard on grip and noise, but in my conversations with tire designers, there is a certain amount of frustration. Tire engineers can deliver good results on a standard ISO sur-face. If they want to deliver good results in the real world, they need more information about real roads.

Lack of dialogue between road and tire engineersThere is precious little dialogue with the road industry among tire engi-neers.

I don’t know if the wide range of roads currently in use around the world makes developing good road-tire combinations impossible, but it seems to me that without that dialogue, we might be missing something.

Just as the tire industry is seeking to develop international standards, so the road industry has a common set of issues. Standardisation might be a good thing.

I suspect we could save a lot of lives, if the tire people worked with the road people to develop good combinations of tread compound and road surface that can improve braking.

Building real-world computer modelsAnother reason I wanted to understand roads better is for the computer modelling community. We spend a lot of time and effort modelling tires. Part of that effort is to improve wet- and dry-grip. I’ve seen a lot of models of tires, but in most of them, the interface with the road is a smooth, idealised surface.

The road community has a lot of data on the condition of roads around the world. Might we not get a better result if we can use some of the models developed by the road industry to interface with our tire models?

Smart tires help road makers plan for the futureA third reason to engage with the road industry is to plan for the future.

When we look at smart tires, we are expecting those tires to have sensors on board that measure the available grip between tire and road.

Would it surprise you to know that the people responsible for maintaining

“Where the rubber meets the road”: It’s a common phrase that means when things get real, as opposed to a theoretical analysis.

Where grip comes from

When we try to understand how tires get their grip, the bottom line is that no-one knows the truth of tire-road interaction. We have a pretty good idea, but we don’t know everything about it. We know, for example that grip is associated with a number of factors:• Rubber distorting around and engaging with microscopic asperities in the road surface;• Weak chemical interactions between the rubber compound and pol-ished surfaces• Lubrication from water or ice• Lubrication from microscopic particles of rubber

But we don’t have a good theoretical model of how to predict the amount of grip available from a given tire-road interaction.

It’s a complex business, and many of us in the tire industry spend a lot of time trying to build computer models of how tires interact with different surfaces, in order to predict the dry- and wet-grip of tires.

The trouble is that few of us in the tire industry know enough about real road surfaces to build true predictive models.

I’ve been at a few meetings recently with the road-building and road-specification industry. The road people were hungry for information about tire technology, while I was fascinated to learn a lot of really inter-esting information from the road technologists.

Did you know?Here’s a few ‘did you know’ questions for starters:• Did you know that the introduction of super-single tires significantly shortened the life of roads in the UK?• Did you know that roads have specifications for grip and noise and that rolling resistance is becoming a big deal for them?• Did you know that a full description of the surface geometry of a road does not enable you to predict grip? (The type of rock or aggregate has a big effect)• Did you know that the available grip on a road can vary from day to day and even hour to hour?• Did you know that road makers are seeking to understand the future requirements of tire makers?

Here’s another: did you realise that the bitumen used in the top surface of many roads is a visco-elastic material that distorts as tires roll over it? It compresses in a bulk way due to axle loads, but within the asphalt, each particle of rock or aggregate also moves under the lateral and longitudinal

What really happens when the rubber meets the road?

31 August 2016 - page 11 of 20© 2016 Shaw Information Services Ltd R E S E A R C H

Each year, the Japanese Automotive Tire Manufacturers’ Association (JATMA), publishes a detailed analysis of the tire manufacturing industry in the country.

The following data is taken from that report, published first in Japanese and then in English.

Japan’s tire industry is in trouble. Like the rest of Japan’s economy, it is shrinking due to reduced demand and increased competition from overseas. Auto tire production hit a peak of 1.358m tonnes in 2007. The equivalent figure in 2015 was just 1.058m tonnes, a decline of over 28% in 8 years, which is a negative CAGR of 3.07%.

Part of this is due to a decline in passenger car sales from 11.596m units in 2007 to 9.278m units in 2015. These vehicle sales drive demand for OE tires.

The decline in car sales has averaged around 250,000 units annually, leading to an average decline in demand of a little over 1m tires annually.

JATMA says 2015 sales of OE tires for cars (36.01m units) and light trucks (5.821m units) amounted to 41.831m units. This represents around 4.5 tires per vehicle, which is consistent with some imported tires being used as OE and an increase in the number of cars without a spare tire.

In fact, the decline in car sales between 2015 and 2014 was nearly double the 8-year average, at 497,000 cars. This meant reduced demand for some 2.2m OE tires. This was combined with the effects of a 32% decline in car sales between 2008 (11.576m units) and 2009 (7934m units), with the resulting decline in replacement sales.

As a result, production of automobile tyres decreased by 5.4% to 151.82 million tyres in 2015. Both domestic demand and exports decreased.

Furthermore, production of all tire types decreased from the previous year, respectively, passenger car tyres, light truck tyres, and truck & bus tyres decreased by 5.2%, by 6.1%, and by 6.7%.

Production Million units 2015/2014(%)

Passenger car tyres 113.8 94.8

Light truck tyres 23.1 93.9

Truck and bus tyres 10.27 93.3

Others 4.59 96.2

Total 151.8 94.6

N.B.: 1. “Others” are off-the-road tyres, industrial tyres, Source: JATMA

Import volume of automobile tyres in 2015 (on customs clearance basis of Ministry of Finance) increased by 0.2% from the previous year to 27.60 million units, weighing 240,000kg (a decline of 3.6%). These imports were worth ¥124.5 billion; a decline of 0.1% on the 2014 figure.Sales of OE tires Million units 2015/2014(%)

Passenger car tyres 36.01m 95.4

Light truck tyres 5.82m 98.7

Truck and bus tyres 1.37m 97.9

Special vehicle 0.883m 96.0

Motorcycle 1.00m 82.5

Total 45.09 94.6

Sales of replacement tires Million units 2015/2014(%)

Passenger car tyres 51.70m 95.8

Light truck tyres 13.61m 93.2

Truck and bus tyres 5.14m 96.7

Special vehicle 0.799m 97.1

Motorcycle 2.17m 97.7

Total 73.427 95.4It is striking in these tables that the sales volume of replacement car tires is only around 1.5 times the number of OE tires sold. This makes it clear that most tires for the replacement market are made off-shore.

Summer tyre sales Million units 2015/2014 (%) Summer tyre rate (%)

Passenger car tyres 34.85 99.6 67.4

Light truck tyres 9.43 95.6 69.2

Truck and bus tyres 2.90 93.7 56.3

Total 47.17 98.4 67.0

N.B.: 1. “Summer tyre rate” indicates a percentage of summertyres in total number of replacement tyre sales.

2. Imported tyres manufactured outside Japan byJapanese manufacturers are included.

3. All-season tyres are included in this category.

Source: JATMA

Imports and exportsExports of automobile tyres (on customs clearance basis of Ministry of Finance) decreased by 6.6% from the previous year to 51.00 million units, weighing 1.14 million tons, a decrease of 6.4%. The export value was ¥634.8 billion, a decrease of 5.6% from the previous year.

Japan Tire Industry

sales amount of the tyre industry of Japan eht dna )rebbur decudorp ylwen fo tnuoma eht( noitpmusnoc lairetam war eht ni segnahC :1 erugiF

Source: Ministry of Economy, Trade and Industry dynamic statistics

140

130

120

110

100

90

80

70

60

50

40

30

20

10

0

14,000

12,000

10,000

8,000

6,000

4,000

2,000

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Rubber consumption (tons×104) Value (yen×108)

Tyre : Value

2010 2011 20152014201320122009200820072006

Non-tyre : Rubber consumption

Non-tyre : Value

Tyre : Rubber consumption

2. Trends in Production by Tyre CategoryThe production volume of automobile tires decreased by 5.4% to 151.82 million units in 2015. This was the firstyear-on-year decline in three years. Both domestic demand and exports decreased and the production volume ofall tire types decreased from the previous year. Passenger car tyres, light truck tyres, and truck & bus tyresdecreased by 5.2%, by 6.1%, and by 6.7% respectively.

Table 2: Japan’s tire production in 2015

Production2015/2014(%)

Passenger car tyres 113.82 94.8

Light truck tyres 23.14 93.9

Truck and bus tyres 10.27 93.3

Others 4.59 96.2

Total 151.82 94.6N.B.: 1. “Others” are off-the-road tyres, industrial tyres, Source: JATMA

agricultural tyres, cart tyres, and motorcycle tyres.2. Figures of some domestic manufacturers that are

non-member of JATMA are included.

0

20

40

60

80

100

120

140

160

180

200

Figure 5: Trends in automobile tyre productionMillion units

2010 2011 20152014201320122009200820072006

Total

PC

LTTB

Others

Million units

Figure 16: Recycling of scrap tyres in 2015

2015(weight)

Reclamation 1%

Chemical factories 5%

Reuse

Retreaded tyre bases 6%

Others 1%Reclaimed & powdered rubber 11%

Thermal RecyclingCement calcining 6%

Boilers 1%

Steel manufacturing 2%

Gasification furnace 5%

PaperTyre manufacturing 2%

manufacturing 44%

Export

Used tyres 11%Cut tyres 1%

Others 8%

31 August 2016 - page 12 of 20© 2016 Shaw Information Services Ltd R E S E A R C H

Figure 21: Trends in sales share of automobile tyres (based on unit volume)

20132012201120102009200820072006

20

0

40

60

80

100%

29.1%

34.9%

29.2%

33.9%

28.7%

36.4%

34.9%

equipmentOriginal

Replace-

Export

ment

25.0%

38.4%

36.6%36.0% 36.9%

26.3%

36.0%

37.7%

27.9%

41.1%

31.0%

27.2%

42.9%

29.9%

23.3%

39.6%

37.1%

2014 2015

26.6%

43.4%

30.0%

26.8%

43.6%

29.6%

Figure 23: Tyre Production Worldwide

Source: IRSG (International Rubber Study Group)N.B.: 1. Unit: x10,000 tons (produced rubber)2. Including tyres other than vehicle tyres.

Japan

China

0

Asia and Oceania (Excluding China and Japan)

Europe, Middle East and Africa

700

2012 2013 2014 2015

279 274 279 282

700

02012 2013 2014 2015

527 568 603 604

700

02012 2013 2014 2015

700

02012 2013 2014 2015 0

North, South and Central America

700

2012 2013 2014 2015

285 290 304 316

261 267107 111 112 109

272 275

0

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Japanese automobile tyre productionMillion units

2010 2011 20152014201320122009200820072006

PC

Total

LTTB

Others

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80

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60

50

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Figure 10: Export trend by regionMillion units

North America and South & Central AmericaEuropeMiddle East and AfricaAsia and Oceania

2010 2013201220112009200820072006 20152014

0

35

30

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20

15

10

5

Figure 11: Import trends by regionMillion units

2007 2010

North America and South & Central AmericaEuropeMiddle East and AfricaAsia and Oceania

2011 2012 20152014201320082006 2009

Figure 12: Breakdown of tyre defects (Parentheses show defect rates)

Notes:1. Multiple tyre defects per vehicle are possible, thus the number of tyre defects does not correspond to the number of vehicles with tyre defects.2. The defect rate is the number of defects divided by the number of vehicles inspected.3. Tyre inspections were carried out a total of 33 times (12 times on expressways and 21 times on ordinary roads) in 2015.

Insufficient tyre grooves

Uneven wear

External cuts (reaching the cord)

Pins or alien matter

Insufficient inflation pressure

Others

21(1.8)33

(2.9)4

(0.4)4

(0.4)195

(17.2)48

(4.2)

Tyre raw material by weight

Tyre cord 13.9%

Steel cord 10.8%Textile cord 3.1%

Rubber 50.9%

Natural rubber 29.6%Synthetic rubber 21.3%

2015100%

Reinforcing agent 24.6%

Compounding ingredients 5.9%

Bead wire 4.7%

31 August 2016 - page 13 of 20© 2016 Shaw Information Services Ltd R E S E A R C H

Production of automobile tyres and tubes2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Truck and bus tyres

Tires14,837 14,394 14,140 9,450 11,208 11,387 10,843 10,808 11,001 10,266

-101.4 -97 -98.2 -66.8 -118.6 -101.6 -95.2 -99.7 -101.8 -93.3

Rubber380,344 370,286 363,618 240,743 281,604 282,053 263,370 259,638 263,082 239,596

-102.3 -97.4 -98.2 -66.2 -117 -100.2 -93.4 -98.6 -101.3 -91.1

Light truck tyres

Tires26,485 25,082 23,986 18,915 22,176 22,604 23,194 24,682 24,649 23,141

-98.9 -94.7 -95.6 -78.9 -117.2 -101.9 -102.6 -106.4 -99.9 -93.9

Rubber176,636 164,489 159,078 122,208 141,588 144,734 142,125 146,561 148,518 139,477

-98.8 -93.1 -96.7 -76.8 -115.9 -102.2 -98.2 -103.1 -101.3 -93.9

Passenger car tyres

Tires134,594 136,731 135,815 107,409 130,530 126,998 120,609 119,485 120,005 113,821

-99.8 -101.6 -99.3 -79.1 -121.5 -97.3 -95 -99.1 -100.4 -94.8

Rubber625,274 643,085 633,863 485,515 599,075 583,792 535,354 523,064 526,341 505,586

-101.2 -102.8 -98.6 -76.6 -123.4 -97.4 -91.7 -97.7 -100.6 -96.1

Off-the-road tyres

Tires554 588 588 293 438 525 504 453 479 446

-106.7 -106.1 -100 -49.8 -149.5 -119.9 -96 -89.9 -105.7 -93.1

Rubber130,611 142,492 157,097 117,670 152,870 181,585 188,224 181,232 164,831 155,453

-106.2 -109.1 -110.3 -74.9 -129.9 -118.8 -103.7 -96.3 -91 -94.3

Industrial tyres

Tires721 748 763 429 449 476 442 399 453 415

-87.2 -103.7 -102 -56.2 -104.7 -106 -92.9 -90.3 -113.5 -91.6

Rubber8,721 9,144 9,108 4,696 5,451 5,899 5,744 4,864 5,761 5,380

-92.8 -104.9 -99.6 -51.6 -116.1 -108.2 -97.4 -84.7 -118.4 -93.4

Others

Tires8,441 8,286 7,371 4,642 4,906 4,452 3,607 3,804 3,838 3,726

-94.3 -98.2 -89 -63 -105.7 -90.7 -81 -105.5 -100.9 -97.1

Rubber30,187 28,836 25,618 15,272 15,123 13,900 12,088 12,591 12,529 12,078

-97.5 -95.5 -88.8 -59.6 -99 -91.9 -87 -104.2 -99.5 -96.4

Total

Tires185,632 185,829 182,663 141,138 169,707 166,442 159,199 159,631 160,425 151,815

-99.5 -100.1 -98.3 -77.3 -120.2 -98.1 -95.6 -100.3 -100.5 -94.6

Rubber1,351,773 1,358,332 1,348,382 986,104 1,195,711 1,211,963 1,146,905 1,127,950 1,121,062 1,057,570

-101.5 -100.5 -99.3 -73.1 -121.3 -101.4 -94.6 -98.3 -99.4 -94.3

Thousand tires Tons rubber Year-to year comparisonN.B.: 1. Source : JATMAN.B.: 2. “Others” are “agricultural tyres”, “motorcycle tyres”, “cart tyres”, and “flaps and rim-bands”*. (*”Rubber” only)N.B.: 3. 2001 and following years had a category shift between truck and bus tyres and light truck tyres

31 August 2016 - page 14 of 20© 2016 Shaw Information Services Ltd R E S E A R C H

Domestics shipment of automobile tyres and tubes2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Truck and bus tyres

Tires6,687 6,681 6,300 4,319 5,166 5,647 5,611 6,051 6,294 6,102

-103.8 -99.9 -94.3 -68.6 -119.6 -109.3 -99.4 -107.8 -104 -96.9

Rubber147,320 147,205 138,982 94,056 111,821 121,806 118,001 128,194 132,039 125,959

-104.3 -99.9 -94.4 -67.7 -118.9 -108.9 -96.9 -108.6 -103 -95.4

Light truck tyres

Tires17,070 16,563 15,227 11,863 14,130 14,576 16,313 18,034 17,766 16,913

-100.8 -97 -91.9 -77.9 -119.1 -103.2 -111.9 -110.5 -98.5 -95.2

Rubber94,671 92,450 86,314 64,126 74,287 76,891 84,184 89,746 90,023 84,935

-100.7 -97.7 -93.4 -74.3 -115.8 -103.5 -109.5 -106.6 -100.3 -94.3

Passenger car tyres

Tires83,538 82,987 81,240 64,410 77,274 76,304 81,640 81,411 81,736 77,441

-102.7 -99.3 -97.9 -79.3 -120 -98.7 -107 -99.7 -100.4 -94.7

Rubber360,177 363,280 348,690 260,861 315,780 304,580 319,184 318,344 319,414 304,460

-105 -100.9 -96 -74.8 -121.1 -96.5 -104.8 -99.7 -100.3 -95.3

Off-the-road tyres

Tires215 217 192 102 140 172 169 188 199 194

-103.9 -100.9 -88.5 -53.1 -137.3 -122.9 -98.3 -111.2 -105.9 -97.5

Rubber16,758 18,594 18,487 7,514 12,757 16,152 14,985 12,823 14,406 12,889

-97.4 -111 -99.4 -40.6 -169.8 -126.6 -92.8 -85.6 -112.3 -89.5

Industrial tyres

Tires726 733 762 470 556 608 545 539 568 541

-92.5 -101 -104 -61.7 -118.3 -109.4 -89.6 -98.9 -105.4 -95.2

Rubber8,079 8,413 8,686 5,184 6,230 6,825 6,157 6,124 6,414 6,111

-97.7 -104.1 -103.2 -59.7 -120.2 -109.6 -90.2 -99.5 -104.7 -95.3

Others

Tires4,485 4,223 4,003 2,676 2,641 2,528 2,261 2,097 2,091 1,988

-90.2 -94.2 -94.8 -66.9 -98.7 -95.7 -89.4 -92.8 -99.7 -95.1

Rubber16,269 15,399 15,609 9,914 9,971 9,464 8,961 8,786 8,797 8,490

-93 -94.7 -101.4 -63.5 -100.6 -94.9 -94.7 -98.1 -100.1 -96.5

Total

Tires112,721 111,404 107,724 83,840 99,907 99,835 106,539 108,320 108,654 103,179

-101.9 -98.8 -96.7 -77.8 -119.2 -99.9 -106.7 -101.7 -100.3 -95

Rubber643,274 645,341 616,768 441,655 530,846 535,718 551,472 564,017 571,093 542,844

-103.6 -100.3 -95.6 -71.6 -120.2 -100.9 -102.9 -102.3 -101.3 -95.1

Thousand tires Tons rubber Year-to year comparisonN.B.: 1. Source : JATMAN.B.: 2. “Others” are “agricultural tyres”, “motorcycle tyres”, “cart tyres”, and “flaps and rim-bands”*. (*”Rubber” only)N.B.: 3. 2001 and following years had a category shift between truck and bus tyres and light truck tyres

31 August 2016 - page 15 of 20© 2016 Shaw Information Services Ltd R E S E A R C H

Export shipment of automobile tyres and tubes2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Truck and bus tyres

Tires8,002 7,760 7,743 5,288 6,011 5,803 5,208 4,630 4,739 4,146

-97 -97 -99.8 -68.3 -113.7 -96.5 -89.7 -88.9 -102.4 -87.5

Rubber229,625 224,257 224,628 152,284 171,056 163,608 146,529 129,486 133,266 114,516

-99 -97.7 -100.2 -67.8 -112.3 -95.6 -89.6 -88.4 -102.9 -85.9

Light truck tyres

Tires9,516 8,939 8,800 7,347 8,122 8,184 6,867 6,616 6,840 6,437

-93.4 -93.9 -98.4 -83.5 -110.5 -100.8 -83.9 -96.3 -103.4 -94.1

Rubber82,301 75,470 73,511 61,294 68,985 69,691 59,288 57,844 59,719 56,596

-94.7 -91.7 -97.4 -83.4 -112.5 -101 -85.1 -97.6 -103.2 -94.8

Passenger car tyres

Tires51,627 54,355 54,351 44,139 53,420 51,097 39,953 38,182 39,070 36,717

-98.3 -105.3 -100 -81.2 -121 -95.7 -78.2 -95.6 -102.3 -94

Rubber266,372 282,519 281,589 229,881 280,881 274,091 216,362 204,849 209,103 201,221

-99.6 -106.1 -99.7 -81.6 -122.2 -97.6 -78.9 -94.7 -102.1 -96.2

Off-the-road tyres

Tires359 388 401 241 350 408 388 335 346 326

-109.8 -108.1 -103.4 -60.1 -145.2 -116.6 -95.1 -86.3 -103.3 -94.2

Rubber113,909 122,943 137,891 112,522 140,328 166,756 174,104 170,369 151,308 143,992

-107.5 -107.9 -112.2 -81.6 -124.7 -118.8 -104.4 -97.9 -88.8 -95.2

Industrial tyres

Tires141 146 118 108 109 78 59 56 70 65

-93.4 -103.5 -80.8 -91.5 -100.9 -71.6 -75.6 -94.9 -125 -92.9

Rubber2,225 2,304 2,064 1,692 2,044 1,866 1,840 1,355 1,841 1,832

-107.1 -103.6 -89.6 -82 -120.8 -91.3 -98.6 -73.6 -135.9 -99.5

Others

Tires3,268 3,500 3,531 2,353 2,704 2,304 1,682 2,000 2,035 2,066

-98.7 -107.1 -100.9 -66.6 -114.9 -85.2 -73 -118.9 -101.8 -101.5

Rubber13,200 13,068 13,310 9,879 10,514 8,985 7,163 7,678 7,763 7,468

-102.1 -99 -101.9 -74.2 -106.4 -85.5 -79.7 -107.2 -101.1 -96.2

Total

Tires72,913 75,088 74,944 59,476 70,716 67,874 54,157 51,819 53,100 49,757

-97.5 -103 -99.8 -79.4 -118.9 -96 -79.8 -95.7 -102.5 -93.7

Rubber707,632 720,561 732,993 567,552 673,808 684,997 605,286 571,581 563,000 525,625

-100 -101.8 -101.7 -77.4 -118.7 -101.7 -88.4 -94.4 -98.5 -93.4

Thousand tires Tons rubber Year-to year comparisonN.B.: 1. Source : JATMAN.B.: 2. “Others” are “agricultural tyres”, “motorcycle tyres”, “cart tyres”, and “flaps and rim-bands”*. (*”Rubber” only)N.B.: 3. 2001 and following years had a category shift between truck and bus tyres and light truck tyres

31 August 2016 - page 16 of 20© 2016 Shaw Information Services Ltd R E S E A R C H

Exports of tyres and tubes Based on Ministry of Finance customs statistics

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Truck and bus tyres

Tires8,002 7,760 7,743 5,288 6,011 5,803 5,208 4,630 4,739 4,146

-97 -97 -99.8 -68.3 -113.7 -96.5 -89.7 -88.9 -102.4 -87.5

Rubber229,625 224,257 224,628 152,284 171,056 163,608 146,529 129,486 133,266 114,516

-99 -97.7 -100.2 -67.8 -112.3 -95.6 -89.6 -88.4 -102.9 -85.9

Light truck tyres

Tires9,516 8,939 8,800 7,347 8,122 8,184 6,867 6,616 6,840 6,437

-93.4 -93.9 -98.4 -83.5 -110.5 -100.8 -83.9 -96.3 -103.4 -94.1

Rubber82,301 75,470 73,511 61,294 68,985 69,691 59,288 57,844 59,719 56,596

-94.7 -91.7 -97.4 -83.4 -112.5 -101 -85.1 -97.6 -103.2 -94.8

Passenger car tyres

Tires51,627 54,355 54,351 44,139 53,420 51,097 39,953 38,182 39,070 36,717

-98.3 -105.3 -100 -81.2 -121 -95.7 -78.2 -95.6 -102.3 -94

Rubber266,372 282,519 281,589 229,881 280,881 274,091 216,362 204,849 209,103 201,221

-99.6 -106.1 -99.7 -81.6 -122.2 -97.6 -78.9 -94.7 -102.1 -96.2

Off-the-road tyres

Tires359 388 401 241 350 408 388 335 346 326

-109.8 -108.1 -103.4 -60.1 -145.2 -116.6 -95.1 -86.3 -103.3 -94.2

Rubber113,909 122,943 137,891 112,522 140,328 166,756 174,104 170,369 151,308 143,992

-107.5 -107.9 -112.2 -81.6 -124.7 -118.8 -104.4 -97.9 -88.8 -95.2

Industrial tyres

Tires141 146 118 108 109 78 59 56 70 65

-93.4 -103.5 -80.8 -91.5 -100.9 -71.6 -75.6 -94.9 -125 -92.9

Rubber2,225 2,304 2,064 1,692 2,044 1,866 1,840 1,355 1,841 1,832

-107.1 -103.6 -89.6 -82 -120.8 -91.3 -98.6 -73.6 -135.9 -99.5

Others

Tires3,268 3,500 3,531 2,353 2,704 2,304 1,682 2,000 2,035 2,066

-98.7 -107.1 -100.9 -66.6 -114.9 -85.2 -73 -118.9 -101.8 -101.5

Rubber13,200 13,068 13,310 9,879 10,514 8,985 7,163 7,678 7,763 7,468

-102.1 -99 -101.9 -74.2 -106.4 -85.5 -79.7 -107.2 -101.1 -96.2

Total

Tires72,913 75,088 74,944 59,476 70,716 67,874 54,157 51,819 53,100 49,757

-97.5 -103 -99.8 -79.4 -118.9 -96 -79.8 -95.7 -102.5 -93.7

Rubber707,632 720,561 732,993 567,552 673,808 684,997 605,286 571,581 563,000 525,625

-100 -101.8 -101.7 -77.4 -118.7 -101.7 -88.4 -94.4 -98.5 -93.4

Thousand tires Tons rubber Year-to year comparison

31 August 2016 - page 17 of 20© 2016 Shaw Information Services Ltd R E S E A R C H

Exports of tyres and tubes Based on Ministry of Finance customs statistics

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Asia

Tyres9,002 9,063 9,129 6,999 7,560 7,827 6,477 5,985 6,356 5,180

-105.3 -100.7 -100.7 -76.7 -108 -103.5 -82.8 -92.4 -106.2 -81.5

Value626,039 680,002 799,530 674,912 808,485 1,031,338 1,054,305 962,418 836,093 631,309

-114.6 -108.6 -117.6 -84.4 -119.8 -127.6 -102.2 -91.3 -86.9 -75.5

Middle East

Tyres11,775 13,921 14,702 13,412 13,627 12,031 10,606 10,333 10,370 9,180

-103.1 -118.2 -105.6 -91.2 -101.6 -88.3 -88.2 -97.4 -100.4 -88.5

Value787,641 956,237 1,184,574 1,107,936 1,173,872 1,263,993 1,234,746 1,087,672 977,794 763,439

-114.5 -121.4 -123.9 -93.5 -106 -107.7 -97.7 -88.1 -89.9 -78.1

Europe

Tyres20,275 22,170 22,200 15,070 18,908 21,108 17,057 15,392 15,324 13,570

-98.6 -109.3 -100.1 -67.9 -125.5 -111.6 -80.8 -90.2 -99.6 -88.6

Value1,288,941 1,668,181 1,849,351 1,162,604 1,486,981 1,928,789 1,725,179 1,509,561 1,377,041 988,576

-105.4 -129.4 -110.9 -62.9 -127.9 -129.7 -89.4 -87.5 -91.2 -71.8

North America

Tyres24,792 22,090 20,729 17,352 23,016 19,353 14,152 13,599 13,996 14,972

-93.6 -89.1 -93.8 -83.7 -132.6 -84.1 -73.1 -96.1 -102.9 -107

Value1,659,175 1,529,500 1,613,517 1,359,334 1,870,321 2,064,587 1,907,040 1,674,369 1,608,169 1,543,873

-103.4 -92.2 -105.5 -84.2 -137.6 -110.4 -92.4 -87.8 -96 -96

S. & central America

Tyres3,673 3,815 4,512 3,086 4,365 3,993 3,160 3,407 3,556 3,113

-103.2 -103.9 -118.3 -68.4 -141.4 -91.5 -79.1 -107.8 -104.4 -87.5

Value295,779 351,155 437,762 410,729 573,743 727,322 817,381 806,013 675,734 595,299

-116 -118.7 -124.7 -93.8 -139.7 -126.8 -112.4 -98.6 -83.8 -88.1

Africa

Tyres2,142 2,329 2,140 1,771 2,274 2,085 2,146 1,868 2,284 2,303

-95 -108.7 -91.9 -82.8 -128.4 -91.7 -102.9 -87 -122.3 -100.8

Value247,077 274,414 289,539 273,759 338,985 369,284 433,173 408,086 357,368 303,212

-101.3 -111.1 -105.5 -94.5 -123.8 -108.9 -117.3 -94.2 -87.6 -84.8

Oceania

Tyres 3,683 4,214 3,959 3,332 3,697 3,243 3,093 3,029 2,747 2,686

-99.2 -114.4 -94 -84.2 -111 -87.7 -95.4 -97.9 -90.7 -97.8

Value 373,273 462,104 490,931 442,356 589,773 763,649 802,393 697,401 537,353 416,188

-102.7 -123.8 -106.2 -90.1 -133.3 -129.5 -105.1 -86.9 -77.1 -77.5

Total

Tyres75,342 77,602 77,371 61,022 73,447 69,640 56,691 53,613 54,633 51,004

-98.4 -103 -99.7 -78.9 -120.4 -94.8 -81.4 -94.6 -101.9 -93.4

Value5,277,926 5,921,593 6,665,204 5,431,630 6,842,160 8,148,962 7,974,217 7,145,520 6,369,552 5,241,896

-107.2 -112.2 -112.6 -81.5 -126 -119.1 -97.9 -89.6 -89.1 -82.3

Thousand tires Tons rubber Year-to year comparison

31 August 2016 - page 18 of 20© 2016 Shaw Information Services Ltd R E S E A R C H

Imports of tyres and tubes Based on Ministry of Finance customs statistics

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Passenger car tires

Tyres25,925 24,089 23,572 19,302 19,346 19,401 20,920 20,267 21,304 21,924

-108.9 -92.9 -97.9 -81.9 -100.2 -100.3 -107.8 -96.9 -105.1 -102.9

Value7,147,540 7,261,682 7,386,186 5,292,031 5,527,743 6,247,210 7,293,639 8,034,798 9,126,658 9,101,192

-121 -101.6 -101.7 -71.6 -104.5 -113 -116.8 -110.2 -113.6 -99.7

Commercial vehicle tires

Tyres2,707 3,207 3,145 2,880 2,617 2,577 2,170 2,245 2,639 2,322

-163.4 -118.5 -98.1 -91.6 -90.9 -98.5 -84.2 -103.5 -117.6 -88

Value1,046,032 1,159,415 1,124,280 911,466 947,069 1,081,932 1,149,559 1,151,719 1,713,412 1,757,492

-147.6 -110.8 -97 -81.1 -103.9 -114.2 -106.3 -100.2 -148.8 -102.6

Motorcycle tires

Tyres3,155 3,091 2,895 2,362 2,595 2,743 2,931 2,841 3,009 2,768

-94.3 -98 -93.6 -81.6 -109.9 -105.7 -106.9 -96.9 -105.9 -92

Value398,770 463,459 382,082 330,296 385,462 416,944 469,834 514,251 558,067 540,554

-101.5 -116.2 -82.4 -86.4 -116.7 -108.2 -112.7 -109.5 -108.5 -96.9

Others

Tyres384 423 510 401 556 593 557 532 592 584

-130.6 -110.3 -120.5 -78.6 -138.7 -106.7 -93.9 -95.5 -111.3 -98.6

Value405,295 528,694 712,295 395,608 701,082 777,141 821,736 833,951 728,744 725,961

-141.6 -130.4 -134.7 -55.5 -177.2 -110.8 -105.7 -101.5 -87.4 -99.6

Tubes Value42,523 128,103 421,909 312,576 351,526 272,805 300,251 302,412 328,625 323,553

-97 -301.3 -329.4 -74.1 -112.5 -77.6 -110.1 -100.7 -108.7 -98.5

Total

Tyres32,171 30,811 30,122 24,945 25,114 25,314 26,578 25,885 27,544 27,598

-110.5 -95.8 -97.8 -82.8 -100.7 -100.8 -105 -97.4 -106.4 -100.2

Value9,040,160 9,541,352 10,026,752 7,241,977 7,912,882 8,796,032 10,035,019 10,837,131 12,455,506 12,448,752

-123.2 -105.5 -105.1 -72.2 -109.3 -111.2 -114.1 -108 -114.9 -99.9

Thousand tires Tons rubber Year-to year comparison

31 August 2016 - page 19 of 20© 2016 Shaw Information Services Ltd R E S E A R C H

Sales of original equipment tyres2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Truck and bus tyres5,608 5,588 5,091 4,042 4,620 4,931 4,727 5,026 5,319 5,143

-102.1 -99.6 -91.1 -79.4 -114.3 -106.7 -95.9 -106.3 -105.8 -96.7

Light truck tyres14,462 14,057 13,103 11,959 12,769 13,731 13,820 14,272 14,615 13,615

-100.5 -97.2 -93.2 -91.3 -106.8 -107.5 -100.6 -103.3 -102.4 -93.2

Passenger car tyres51,931 49,504 46,952 43,124 46,908 50,448 50,119 52,109 53,956 51,699

-101.2 -95.3 -94.8 -91.8 -108.8 -107.5 -99.3 -104 -103.5 -95.8

Total for four-wheeled vehicle tyres72,001 69,149 65,146 59,125 64,297 69,110 68,666 71,407 73,890 70,457

-101.2 -96 -94.2 -90.8 -108.7 -107.5 -99.4 -104 -103.5 -95.4

Off-the-road tyres131 132 117 76 87 102 94 101 105 103

-102.3 -100.8 -88.6 -65 -114.5 -117.2 -92.2 -107.4 -104 -98.1

Industrial tyres756 741 711 530 593 635 565 583 597 581

-98.2 -98 -96 -74.5 -111.9 -107.1 -89 -103.2 -102.4 -97.3

Agricultural tyres167 130 120 110 114 109 103 100 93 86

-85.6 -77.8 -92.3 -91.7 -103.6 -95.6 -94.5 -97.1 -93 -92.5

Motorcycle tyres2,147 2,096 2,092 1,877 1,908 1,702 1,637 1,604 1,551 1,510

-97.7 -97.6 -99.8 -89.7 -101.7 -89.2 -96.2 -98 -96.7 -97.4

Cart tyres40 38 35 33 29 28 27 30 28 29

-87 -95 -92.1 -94.3 -87.9 -96.6 -96.4 -111.1 -93.3 -103.6

Total75,242 72,286 68,221 61,751 67,028 71,686 71,092 73,825 76,264 72,766

-101 -96.1 -94.4 -90.5 -108.5 -106.9 -99.2 -103.8 -103.3 -95.4

31 August 2016 - page 20 of 20© 2016 Shaw Information Services Ltd R E S E A R C H

Replacement sales of summer tyres and winter tyres2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Truck and bus tyres Total 5,608 5,588 5,091 4,042 4,620 4,931 4,727 5,026 5,319 5,143

-102.1 -99.6 -91.1 -79.4 -114.3 -106.7 -95.9 -106.3 -105.8 -96.7

Summer 3,401 3,511 3,331 2,587 2,923 2,969 2,710 2,961 3,090 2,896

-98.2 -103.2 -94.9 -77.7 -113 -101.6 -91.3 -109.3 -104.4 -93.7

Winter 2,208 2,077 1,760 1,455 1,697 1,962 2,017 2,065 2,229 2,247

-108.8 -94.1 -84.7 -82.7 -116.6 -115.6 -102.8 -102.4 -107.9 -100.8

Light truck tyres Total 14,462 14,057 13,103 11,959 12,769 13,731 13,820 14,272 14,615 13,615

-100.5 -97.2 -93.2 -91.3 -106.8 -107.5 -100.6 -103.3 -102.4 -93.2

Summer 9,858 9,911 9,561 8,901 9,344 9,654 9,547 9,750 9,863 9,426

-96.2 -100.5 -96.5 -93.1 -105 -103.3 -98.9 -102.1 -101.2 -95.6

Winter 4,604 4,146 3,542 3,058 3,425 4,077 4,273 4,522 4,752 4,189

-111.1 -90.1 -85.4 -86.3 -112 -119 -104.8 -105.8 -105.1 -88.2

Passenger car tyres Total 51,931 49,504 46,952 43,124 46,908 50,448 50,119 52,109 53,956 51,699

-101.2 -95.3 -94.8 -91.8 -108.8 -107.5 -99.3 -104 -103.5 -95.8

Summer 34,417 34,859 33,564 31,183 33,620 34,394 33,366 33,738 34,979 34,851

-97.4 -101.3 -96.3 -92.9 -107.8 -102.3 -97 -101.1 -103.7 -99.6

Winter 17,514 14,645 13,388 11,941 13,288 16,054 16,753 18,371 18,977 16,848

-109.8 -83.6 -91.4 -89.2 -111.3 -120.8 -104.4 -109.7 -103.3 -88.8

Total Total 72,001 69,149 65,146 59,125 64,297 69,110 68,666 71,407 73,890 70,457

-101.2 -96 -94.2 -90.8 -108.7 -107.5 -99.4 -104 -103.5 -95.4

Summer 47,675 48,281 46,456 42,671 45,887 47,017 45,623 46,449 47,932 47,173

-97.2 -101.3 -96.2 -91.9 -107.5 -102.5 -97 -101.8 -103.2 -98.4

Winter 24,326 20,868 18,690 16,454 18,410 22,093 23,043 24,958 25,958 23,284

-109.9 -85.8 -89.6 -88 -111.9 -120 -104.3 -108.3 -104 -89.7