Another production capacity plan landed in Southeast Asia

In 2025, another tire industry company began to consider deploying production capacity in Cambodia. However, this time it was not the tire industry, but its upstream industry that started the Southeast Asian production capacity inspection. It is reported that Hainan Rubber, a major natural rubber producer in China, is considering building a factory in Cambodia or Laos to optimize its overseas industrial layout.

01 Hainan Rubber Southeast Asia Factory
On March 19, 2025, Wang Hongxiang, Secretary of the Party Committee and Chairman of Hainan Rubber, and his party discussed relevant matters with the Lao Ministry of Agriculture and the Cambodian Rubber Association during their inspection of overseas production capacity layout. During the negotiation with the Lao Ministry of Agriculture, Wang Hongxiang stated that Hainan Rubber plans to use its capabilities in planting, processing and trade to promote the development of the Lao rubber industry.

At the same time, it also introduced China's "multiple preferential policies" to promote the development of the natural rubber industry and encourage the development of natural rubber planting, processing and trade. Wang Hongxiang said: "In the future, Hainan Rubber will focus on building standardized rubber planting demonstration sites to improve the overall level of local natural rubber technology in Laos." When Hainan Rubber negotiated with the Cambodian Rubber Association, Hainan Rubber focused on discussing the large-scale capacity investment of Chinese tire manufacturers in Cambodia in the past two years, as well as the growing demand for natural rubber in these factories in the future. Hainan Rubber's factory construction inspection in Cambodia is also an on-site study of the feasibility of building an advanced rubber factory in Cambodia.

Although the rubber industry speculates that Hainan Rubber has begun to deploy overseas factories in order to optimize overseas channel supply, and at the same time obtain more raw material supply and lower costs in more rubber main producing areas to expand profit margins, industry insiders in the tire industry generally believe that Hainan Rubber's move is also to achieve more overseas cooperation with Chinese tire factories.

According to incomplete statistics, as of January 2025, at least five Chinese tire companies have built tire factories in Cambodia. Tire companies have already started production and started the second and third phases of the project, which also means that Cambodia's demand for natural rubber products will usher in explosive growth! In the future, as global trade barriers continue to increase, more tire companies will be "forced" to start global capacity upgrades to sell in overseas markets, which also means that upstream companies will "migrate" overseas together with the shift of their downstream demand.

02 Tariffs increase, China's tire industry tightens its belt
In 2025, Trump increased tariffs on Chinese products twice in just one month. The first time was on February 4, 2025, when a 10% tariff was imposed on Chinese goods; one month later, on March 4, the United States increased tariff barriers again-an additional 10% on the original 10%, with a cumulative tax rate of 20%. This also means that a truck tire exported from China to the United States in 2024 will increase by at least 169 yuan compared to 2023, and the price of Chinese truck tires will lose its price advantage again.

In order to maintain the same price advantage as before, it is not ruled out that Chinese tire companies will squeeze profits on their own and reduce export prices to a lower level. However, as more overseas markets (Brazil, South Africa, and Europe) continue to increase tariffs on China, and the United States is expected to increase tariffs with uncertainty, how long will this period of relying on "self-sacrifice" in exchange for sales last?