Kazakhstani businessmen bought snow tires manufactured in China at the China-Kazakhstan Horgos International Border Cooperation Center, Northwest China's Xinjiang Uygur Autonomous Region on November 8, 2023. Photo: VCG

Since the beginning of 2024, Sentury Tire, a renowned Chinese tire manufacturer, has been operating its factory at full pace to keep up with the overwhelming overseas demand. 

This booming activity highlights the strong demand for Chinese tires and propels the momentum of China's export outlook in 2024, which is expected to see a positive trend after making steady improvement in 2023, experts said.

Booming tire exports 

The Chinese tire industry experienced a booming year in 2023 and many see this trend continuing in 2024. Due to multiple factors such as high demand and overseas expansion of companies, the domestic tire industry in China is experiencing favorable conditions for development.

"Starting from the beginning of 2024, we have seen a significant increase in orders from the traditional lucrative markets of Europe and America. There is also a noticeable growth in demand for orders from North Africa, the Middle East, South America, and Southeast Asia," Wang Qian, securities representative of Sentury Tire, told the Global Times on Monday. 

According to Wang, the company's demand for orders far exceeds its production capacity. It is expected that the intended overseas demand will continue to be strong throughout the entire year 2024.

Another Chinese tire manufacturer, Sailun Group, told the Global Times on Monday that their export orders for January are full. "We primarily export to North America and Europe and the export situation in 2024 mirrors the momentum we saw in the third and fourth quarter last year," a company executive in charge of investor relations said.

In the face of high inflation in the European and American markets, Chinese tires have a significant advantage in terms of cost-effectiveness, leading to a substantial increase in exports. China's car exports, which was set to beat Japan and rank first globally for the first time in 2023, also led to an increased share of Chinese tires overseas.

The country's export of semi-steel tires, primarily utilized for passenger vehicles, witnessed a remarkable 20 percent year-on-year surge, reaching a total of 287 million units in 2023.

"Chinese tire products display good cost-performance, which is highly valued by foreign consumers. Most [Chinese] tire manufacturers are optimistic about the prospects for the coming years," Wang from the Sentury said.

The optimistic outlook propelled Chinese tire exporters to expand more actively into the overseas market.

In order to meet the strong demand for overseas orders, Sentury established a new production base in the Morocco last year which is expected to start operations in the fourth quarter of this year. 

"Our plan for the next few years is to keep expanding production capacity," Wang said. "There is no problem with orders, as the demand is strong."

Sailun is also planning to establish a joint venture in Mexico for the production of semi-steel tires with an investment of $240 million, the company said in a filing in December 2023.

Rapid turnaround 

The tire industry's booming start of 2024 mirrors a positive "turnaround" in the export situation for the year. 

According to the General Administration of Customs, China's imports and exports expanded by 0.2 percent year-on-year in 2023, reaching a total of 41.76 trillion yuan ($5.80 trillion). The foreign trade scale had seen steady increase each quarter, with growth continuing month by month in the fourth quarter. In particular, December saw a historical high in monthly trade volume, reaching 3.81 trillion yuan.

Since the fourth quarter of 2023, a revival in China's imports and exports to the European Union and the US has sent a clear signal that a turning point in foreign trade has emerged. This indicates that China's policies aimed at stabilizing foreign trade have started to take effect after a year of hard work, Wei Jianguo, former Chinese vice minister of commerce, told the Global Times on Monday.

Chinese authorities have stepped up efforts to stabilize foreign trade in 2023 with various effective measures. This includes supporting the private economy and accelerating the integration of domestic and foreign trade.

 "Efforts should be made to seize the opportunity presented by the turning point and make even greater efforts to quickly transform the upward trend into better development this year," Wei said.

Despite the weak global economic recovery and overall sluggish performance of global trade, China has managed to expand its foreign trade scale and keep consumer prices at a steady level, in contrast a trend of global inflation across major economies.

The achievement is hard-won and indicates China's increasing contribution to the global economy, Wei said.

In 2023, China's economic growth rate came in at 5.2 percent, which is not only higher than the projected global growth rate of around 3 percent but also ranks among the top in the world's major economies, according to the National Bureau of Statistics (NBS).

The NBS estimates China's economy to contribute over 30 percent to global economic growth in 2023, making it the largest engine driving global economic growth.

"In 2024, China's contribution to the global economy and its share in global trade will continue to increase," Wei said.

The fundamentals sustaining China's steady growth in the long run have not changed and the world has shown confidence in China's economy in 2024.

An IMF senior resident representative in China forecast that the Chinese economy will maintain sound growth in 2024 and continue to account for one-third of global economic growth. The Economist Intelligence Unit predicted that the fundamentals of China's economy in 2024 will be further cemented. Institutions such as the US Center for Strategic and International Studies believe that China's exports remain strong in electric vehicle batteries, electronic products and minerals and quite a few Chinese industries have become globally competitive.