Recently, CCTV Finance’s “Zhengdian Finance” launched a special report on “Tire Price Rise Investigation”, focusing on the wave of price increases that have swept the entire industry since mid-April.
Michelin, Bridgestone, Zhongce and other leading domestic and foreign companies have successively issued price adjustment letters. Passenger car tires generally increased by 2% to 5%, and truck and bus tires followed suit.
Behind this seemingly ordinary price adjustment are the multiple pressures of skyrocketing raw materials, exchange rate fluctuations, and pressure on the industrial chain. It is also an industry turning point for new energy vehicles to reshape demand and domestic tires to accelerate their breakthrough.
This round of tire price increases is not caused by strong market demand, but by passive price adjustments under continued pressure from the cost side.
The immediate trigger was the sharp rise in rubber prices.
In terms of natural rubber, affected by the delayed opening of production areas in Southeast Asia and the mismatch between market supply and demand, the spot price once shot up to 17,900 yuan/ton, a high in recent years.
Synthetic rubber is even worse. The raw material butadiene has risen rapidly since March, with a maximum surge of nearly 8,000 yuan per ton in a single month. The futures price once reached 17,470 yuan/ton. It is rare to overtake natural rubber.
At the same time, fluctuations in international crude oil and changes in the situation in the Middle East, coupled with rising shipping costs, have further driven up the prices of auxiliary materials such as carbon black and steel cord, and the overall production costs of tire companies have continued to rise.
Many people mistakenly believe that manufacturers increase prices to earn higher profits, but the fact is exactly the opposite.
At present, most companies are still consuming their early low-priced raw material inventories. Even so, profit margins have been greatly compressed, and some mid-range brands have even fallen into loss-making production.
This round of price increases is more like a self-protective price adjustment by an enterprise. The purpose is to maintain the basic bottom line of production rather than pursue excess returns.
Cost pressure will not stay at the production end, but will be transmitted step by step along the industrial chain to dealers and terminal stores. This is also the most realistic portrayal of the industry in the CCTV survey.
Faced with price increase notices issued by manufacturers in advance, channels have already begun to proactively respond.
When CCTV visited many auto repair stores in Shandong, it was found that many store owners locked up the supply of goods in advance and increased stocking. Some stores even reserved enough commonly used tires for two months in order to lock in low prices and hedge against the operating pressure caused by subsequent price increases.
But this buffer only provides temporary relief.
Stores have limited inventory capacity and high capital usage, and cannot withstand the cost impact caused by high-level operations of raw materials for a long time.
Coupled with the fierce competition in the terminal market, stores dare not easily raise prices significantly and can only make a difficult balance between small price adjustments, compressed gross profits, and reduced promotions.
It is generally judged in the industry that as the early low-price inventory is gradually exhausted, if raw material prices continue to remain high, the end market is likely to see more significant price increases, and this round of cost-driven adjustments will also accelerate the survival of the fittest in the industry.
Faced with dual fluctuations in raw material prices and exchange rates, leading tire companies did not passively bear the pressure. Instead, they continued to improve risk management tools and build a multi-dimensional hedging system.
On the commodity side, with the listing of No. 20 rubber options, companies have richer risk control tools. Most leading companies use a combination of long-term price lock agreements + hedging to stabilize the cost risks caused by large fluctuations in rubber prices.
On the foreign exchange side, as tire companies accelerate their overseas expansion, overseas business generally accounts for more than 40%, and the exchange impact caused by exchange rate fluctuations has significantly increased. Many listed tire companies have announced the implementation of foreign exchange hedging.
“Commodity + foreign exchange” portfolio hedging is becoming a key means for enterprises to hedge core risks.
In addition, companies are also actively adjusting their product mix, increasing the proportion of high value-added products, simultaneously optimizing formulas and cost control mechanisms, improving risk resistance from the product side, and gradually getting rid of the past extensive model of low price and high volume.
If rising costs are a short-term pain, then the rapid popularity of new energy vehicles is a key force in reshaping the tire industry in the long term.
Due to heavier batteries and greater motor torque, new energy vehicles have put forward new requirements for tires: the load capacity needs to be increased by 5% to 10%, the silent effect needs to be reduced by another 5-8 decibels, and the low rolling resistance and grip requirements are about 10% higher than those of traditional fuel vehicle tires.
The long-standing devil’s triangle problem in the industry of “low rolling resistance, wear resistance, and safety” that is difficult to balance has become the core direction of technological breakthroughs.
Relying on the world’s largest new energy vehicle market, domestic tires have ushered in a rare opportunity to break through.
Domestic companies continue to increase technology research and development. For example, Sailun Group has achieved performance breakthroughs through liquid phase mixing technology, gradually breaking down the technical barriers of overseas brands.
Domestic tires have also shifted from focusing on the after-sales replacement market in the past to being deeply involved in the front-loading of new energy vehicle companies. The domestic market share has exceeded 55% for three consecutive years.
Judging from the overall trends of the industry, this round of price increases has formed a large-scale transmission effect.
According to incomplete statistics, since May, in addition to Michelin, Bridgestone, Zhongce and other leading brands mentioned in CCTV Financial Research, more than 80 domestic and foreign tire companies have successively issued price adjustment announcements, covering all categories of products such as passenger tires and truck and bus tires. This price adjustment has officially become the second round of large-scale centralized price adjustments in the tire industry in 2026.
Judging from the logic of market operation, this round of price adjustment is not a short-term pulse market.
The progress of cutting in the main natural rubber production areas is slow and the supply recovery is less than expected. The prices of synthetic rubber and chemical auxiliary materials are still running at a high level, and the cost pressure on enterprises has not yet been substantially relieved.
Coupled with the continued depletion of low-price raw material inventories in the industry, if commodity prices remain high, cost pressure will continue to be transmitted to terminals, which also means that this round of price increases may not be the end, and the industry price upward cycle is still continuing.
This round of tire price increase surveys conducted by CCTV Finance essentially presents a true picture of China’s tire industry transforming under pressure and upgrading amid changes.
In the short term, price increases will put pressure on corporate profits, narrow channel gross profits, and slightly increase terminal tire replacement costs, which is a pain that the entire industry must face.
But in the long run, this round of cost pressure and demand changes are pushing the industry to bid farewell to extensive growth, accelerating the elimination of small and medium-sized players that lack cost control, weak technology, and fragile channels, allowing leading companies with risk control capabilities, R&D capabilities, and global layout to occupy a larger market share.
From raw material hedging to technological research, from domestic supporting to overseas deployment, China’s tire industry is completing a key upgrade under pressure.
This price increase is not the end of the industry, but a new starting point for domestic tires to get rid of low price tags, delve into technology research and development, and enter the global stage.
For some time to come, tire prices will still be deeply tied to raw material prices, and competition on the new energy track will ultimately determine the position of Chinese tires in the global industrial landscape.
