Affected by factors such as insufficient demand in the domestic replacement market and intensified competition in the international market, in 2025, the production and sales of Triangle Tire Co., Ltd. (hereinafter referred to as “Triangle Tire”) (601163.SH) fell slightly year-on-year, operating income fell by 3.30% year-on-year, and net profit attributable to the parent company fell by 16.30% year-on-year, a “double decline” for two consecutive years.
However, due to factors such as lower raw material prices, higher gross profit margins, and increased sales, the company’s performance rebounded against the trend in the first quarter of 2026, and profitability indicators were restored.
On the afternoon of May 11, Triangle Tire held a performance briefing for 2025 and the first quarter.
At the meeting, issues such as the company’s significant increase in R&D expenses, rising inventory scale, 2026 business plan and overseas market layout were discussed.
Lin Xiaobin, general manager of Triangle Tire, responded that the company’s production capacity will remain stable in 2026, with a planned output of 25 million units. At the same time, it will maintain a high production-to-sales ratio and inventory will be maintained at a reasonable level.
Faced with the tire industry being affected by rising raw material costs, trade barriers and regional conflicts, the company will actively respond to changes and challenges.
In terms of overseas markets, the company will adhere to a balanced and sustainable market layout.
The differentiation of market demand has dragged down the production and sales of Triangle Tire.
The annual report shows that Triangle Tire is a professional tire manufacturer and supplier that integrates tire design, manufacturing and marketing. It takes tire R&D, manufacturing and global marketing as its core business. Its tire business revenue accounts for more than 99% of the company’s total operating revenue, and its business structure is highly concentrated.
In 2024, Triangle Tire’s operating income will be 10.156 billion yuan, a year-on-year decrease of 2.55%.
In 2025, the company’s revenue will further decline to 9.821 billion yuan, a year-on-year decrease of 3.30%.
Among them, domestic revenue was 4.038 billion yuan, a year-on-year decrease of 2.25%; gross profit margin was 14.98%, a year-on-year increase of 1.23 percentage points; foreign revenue was 5.747 billion yuan, a year-on-year decrease of 3.95%, but the gross profit margin was 23.08%, a year-on-year increase of 2.78 percentage points.
In terms of products, during the reporting period, the company’s main business (tires) revenue was 9.786 billion yuan, a decrease of 329 million yuan or 3.25% year-on-year; the main business cost was 7.854 billion yuan, a decrease of 478 million yuan or 5.74% year-on-year.
In 2025, the company will produce 24.09 million tires of various types, with a production capacity utilization rate of approximately 90%; sales will be 22.61 million, with a production and sales rate of 94%.
From the perspective of market segments, the company’s domestic trade sales of commercial vehicle tires and domestic sales of passenger vehicle tires will increase by 3.6% in 2025, of which the supporting volume of new energy vehicles will increase by more than 40%; the supporting sales of passenger car tires will increase by 15%, of which the supporting volume of new energy vehicles will increase by nearly 40%; radial engineering tires will seize the opportunity of the continued growth of the domestic engineering machinery industry to achieve an increase of more than 20% in supporting volume.
However, during the same period, the company’s tire inventory increased significantly by 95.10% year-on-year, which triggered the market’s attention to inventory control and turnover efficiency.
At the performance meeting, regarding inventory control and production and sales planning in 2026, Lin Xiaobin emphasized that the company’s inventory “currently remains at a normal level.”
The inventory volume in 2025 will increase significantly year-on-year, mainly due to the low inventory at the end of 2024.
In 2026, the company’s “inventory will be maintained at a reasonable level.”
The comprehensive financial report shows that Triangle Tire’s profitability has continued to weaken in recent years.
In 2023, the company’s net profit attributable to the parent company was 1.396 billion yuan, which dropped to 1.103 billion yuan in 2024, a year-on-year decrease of 21.03%.
In 2025, the company’s net profit attributable to the parent company further dropped to 923 million yuan, a year-on-year decrease of 16.30%.
It is worth mentioning that among the many factors that put pressure on profits, the sharp increase in R&D expenses has become one of the core influencing factors.
According to the annual report, the company’s R&D expenses will increase from 154 million yuan in 2024 to 465 million yuan. High-cost R&D is mainly invested in the fields of new energy supporting tires and high-end wear-resistant tires to meet the needs of high-end domestic and foreign markets.
Regarding the substantial increase in R&D expenses, Lin Xiaobin replied that it was mainly due to the increase in R&D investment in this period and the impact of centralized collection.
It did not disclose further detailed plans for long-term sustainable planning of high R&D investment.
Despite continued pressure on performance, the company still plans to distribute a cash dividend of 4 yuan (tax included) to all shareholders for every 10 shares.
Based on the total share capital of 800 million shares, a total cash dividend of 320 million yuan (tax included) is planned, accounting for 34.67% of the net profit attributable to shareholders of listed companies in the 2025 consolidated statement.
Entering 2026, the external operating environment of the tire industry has improved marginally, coupled with the company’s internal optimization of business strategies and upgrading of cost control systems, the first quarter performance has reversed the continuous downward trend and achieved performance recovery growth.
The first quarter report shows that from January to March 2026, the company’s operating income was 2.470 billion yuan, a year-on-year increase of 10.04%; the net profit attributable to shareholders of the listed company was 218 million yuan, a year-on-year increase of 31.18%; the net profit after deducting non-attributable shares was 167 million yuan, a year-on-year increase of 54.82%.
Triangle Tire said that its first-quarter performance rebounded mainly due to factors such as lower raw material prices, increased gross profit margin, and increased sales in the current period.
In terms of production, sales and pricing, in the first quarter of 2026, the company’s main product production volume was 5.4838 million units, sales volume was 6.0324 million units, and corresponding product sales revenue was 2.455 billion yuan.
At the same time, the sales price of the company’s tire products fell by 4.25% year-on-year and 0.32% month-on-month.
The comprehensive purchase price of the company’s main raw materials, natural rubber, synthetic rubber, steel cord, and carbon black, fell by 9.63% year-on-year and increased by 1.76% month-on-month.
Although the performance in the first quarter showed an improvement trend, Lin Xiaobin still cautiously stated that in 2026, the tire industry will be affected by rising raw material costs, trade barriers and regional conflicts.
It is understood that the export sales of Triangle tires currently account for nearly 60%, and the marketing network covers more than 180 countries and regions around the world.
But at the same time, the rise of global trade protectionism and the intensification of geo-trade barriers have also become core uncertain factors restricting the company’s overseas business expansion.
Just on April 13, the EU reached a preliminary trade agreement, planning to reduce nearly half of its steel imports and impose an additional 50% tariff on excess imported steel. Trade protection continues to increase.
In response to overseas policy risks and response strategies, Lin Xiaobin said that in the short term, the company will actively communicate with EU customers and maintain close coordination. At the same time, relying on a balanced global marketing network, it will strengthen the development of potential markets in other overseas regions and achieve dynamic diversification of regional risks. From a long-term strategy, the company will continue to deepen its global layout, steadily promote overseas localization projects, systematically enhance its ability to withstand trade risks through optimizing supply chains, and build a sustainable international business system.
Currently, Triangle Tire’s overseas localization layout has implemented substantial projects: On January 15 this year, the company announced that it plans to invest 3.219 billion yuan in a new high-performance radial tire project in Cambodia with an annual output of 7 million units. The project is scheduled to start construction in March 2026 and the construction period will be approximately 17 months.
After the completion of the project, Triangle Tire will have an additional production capacity of 6 million semi-steel radial tires and 1 million all-steel radial tires, and is expected to achieve an average annual operating income of 2.585 billion yuan.
Lin Xiaobin said that the Cambodian project is currently undergoing the approval process and is making relevant preparations.
It is understood that one of the core purposes of the company in building overseas factories is to avoid trade barriers.
Compared with the strict trade policies of Europe and the United States, Cambodia has policy advantages such as preferential foreign investment and tax exemptions, which can effectively reduce tariff costs and expand overseas profit margins.
According to a research report by Huatai Securities, Triangle Tire’s current export sales account for nearly 60%, and its marketing network covers more than 180 countries and regions around the world.
With the planned annual production capacity of the new Cambodian factory of 6 million semi-steel tires and 1 million all-steel tires gradually reaching production and expansion, the expansion of the European and American markets is expected to drive the company’s performance and profit.
