Another foreign giant has withdrawn from China, and Bridgestone is also numb?
Recently, Bridgestone issued the "Notice of Closure of China's Commercial Vehicle Tire Supporting Business", announcing the termination of the commercial tire business of its Chinese subsidiary and the closure of its Shenyang plant, which will focus on the high-end passenger car tire business.
As a world-renowned tire giant, Bridgestone officially entered the Chinese market in 1996, 27 years ago, and the Shenyang plant is its first tire factory and its business headquarters in China.
Just before Bridgestone issued the notice, there was news on the Internet that the Shenyang factory had more than 1,200 employees and more than 5,000 tires per day.
However, even after 27 years of deep cultivation in China, Bridgestone still chose to say goodbye and officially announced the termination of the commercial tire business of its Chinese subsidiary.
What's going on? Why did the once well-known tire giant "fold" China?
Bridgestone's departure from China was actually a sign of it.
At the end of 2021, Bridgestone issued a notice saying that all its Huizhou factories would be closed, and all the production capacity and equipment of the Huizhou factories would be transferred to the Shenyang factory.
By the end of 2023, the same plot will be staged again, and Bridgestone said that it will terminate the sales of commercial vehicles in China on December 31, 2023, "facing challenges such as the market recovery is less than expected and the international market demand is sluggish".
To put it bluntly, the product does not sell well, the business pressure is too great, and I will not do it in the future.
Then, in January this year, Bridgestone issued another notice that its Shenyang plant was completely shut down on January 27, and finally completely closed on February 29, drawing an end to Bridgestone's commercial vehicle tire business in China.
With the factory gone, where will the 1,200 employees go?
It should be said that Bridgestone has done quite well in terms of severance compensation.
Generally speaking, the statutory severance compensation amount in China is n+1, that is, the salary of the position multiplied by the number of years of service, plus one month's salary as compensation.
But Bridgestone multiplied it by 1 on the basis of n+1The coefficient of 3 is equal to 13 times.
Some employees appeared on social **, saying that someone around them got 500,000 yuan, and if they were dual-income families, they could even get 1 million yuan.
It is precisely for this reason that we do not call Bridgestone's withdrawal from the Chinese market a defeat, but rather an "withdrawal", after all, in terms of conscience and responsibility, Bridgestone has done quite well.
Regarding the reason for withdrawing from the Chinese market, Bridgestone made it clear in the announcement:
Production and sales of commercial vehicle tires in China declined. Although our company has made many internal efforts to optimize production capacity and reduce costs, the effect has not met expectations and has not been able to change the predicament.
As a well-known leader in the global tire industry, it has been deeply involved in the Chinese market for 27 years, why did it suddenly decline?
The main reason is the rise of domestic tires, the profit margins of these tire giants are constantly compressed, the market share is decreasing, and the operating pressure is increasing.
Unlike the passenger car tire market, there is only one decisive factor affecting sales in the commercial vehicle tire market, and that is cost.
Consumers often consider more brand value requirements when choosing passenger car tires, as long as the tire performance is better and the brand is bigger, even if they pay a certain brand premium for it, most consumers will gladly accept it.
But commercial vehicle tires are very different, as part of the means of production, the lower the more durable is the most "excellent" tire.
As for what brand to choose, it has never been the first factor that commercial vehicle tire consumers consider, and it may not even be considered at all.
Especially in recent years, the cost of land transportation has continued to rise, the cost pressure of individual transporters is increasing, and the cost requirements for tires are also increasing.
And when it comes to cost, it is precisely the biggest advantage of domestic tire brands.
Compared with foreign brands that are still considering the safety performance, low rolling resistance, comfort, silence, etc., domestic tire brands are directly simple and rude, giving the most powerful **.
Just imagine, if you are a large truck owner, in the case of similar basic performance, domestic tires are half or even less of foreign-funded tires, how will you choose?
It is precisely because of this that foreign tires are gradually losing their competitiveness in the Chinese market, not only Bridgestone, but also many foreign tire giants, including Sumitomo Rubber and Dunlop, have become numb, and withdrawing from the Chinese market has almost become the only option.
Every time foreign capital withdraws from the Chinese market, it is always accompanied by bursts of boos, as if leaving the Chinese market is equivalent to a death sentence, which means that the company has completely failed.
But let's be objectiveFrom the perspective of these multinational enterprises, it is actually a very normal thing to adjust their own development strategies and seek a broader space for development.
Bridgestone, for example, is increasing its investment in its Indian factories while withdrawing from the Chinese market.
Just last year, Bridgestone spent 6.2 billion rupees (about 5 yuan.)100 million) to build a tire plant in Pune, India, to expand production capacity by 10%-12%.
In the final analysis, it is because the competition in the Chinese market is too fierce, the rise of Chinese tire manufacturers is too fast, and Bridgestone's competition is weak, so it has to turn to Southeast Asia, where it is easier to make money.
After all, all business choices are for the purpose of "looking at money", as long as you can make money by changing the market, then change the market.
At a deeper level, as China's industrial upgrading continues to move forward, more Chinese companies will rise in the future, and similar plots will definitely be staged again, Bridgestone is not the first, nor will it be the last.
For example, in the new energy vehicle market, which is now fighting bayonets, Chinese car companies are making continuous progress in the process of continuous involution, while joint venture car companies are losing ground and retreating, and there are not a few joint venture car companies that choose to withdraw.
But whether or not to leave the Chinese market, it is a commercial choice, which is also the advantage of multinational enterprises.
Write at the end:
Bridgestone's withdrawal from the Chinese market is shining in that the aftermath has indeed been done beautifully, and the enforcement of labor laws is in place.
At this point, some domestic enterprises should really open their eyes and learn hard, and do things from the beginning to the end, and the same is true for enterprises. Kunpeng Project