All-steel tires: End-of-year economy "presses" warehouses, inventory markdown reserves become a ghostly shadow

As we enter the final month of the year, the steel belt tire market once again faces a “surplus warehouse, shortages in sales” situation. According to data from Golden Ten Data on January 4th, in December, most dealers experienced a significant increase in inventory levels, with only a few maintaining stable or slightly reduced stock compared to previous months.

Pressure from Market Demand

The main cause of this situation is not external factors, but the continuous weakening of end-user demand. During this period, downstream construction and industrial manufacturing activities show clear signs of decline. This directly impacts the amount of goods shipped from dealer warehouses — decreasing month over month, leading to sluggish consumption rates.

Additionally, the last quarter of the year is when dealers focus on signing new contracts and recovering receivables. This burden further slows down the dispatch process, creating a vicious cycle: unsold goods, yet continued imports to meet targets.

Contradiction Between Target Pressure and Inventory Levels

Strangely, despite high inventory levels, dealers continue to import goods. The reason is they are under “pressure” to meet annual goals. However, not all dealers can “handle” such inventory levels. Those who have accumulated high stock levels earlier are forced to actively control and even reduce new imports to avoid adding further burden.

January Will Be a “Storm” for Warehouses

According to Zhuochuang Information, January next year is the most dangerous period for dealers. It is the last month before the Lunar New Year — when demand drops to its lowest. At the end of the month, many downstream industries enter the holiday break, severely limiting overall demand.

Dealers will continue to focus on recovering receivables, with warehouse dispatch rates remaining sluggish. In a scenario of “overstocked goods, no buyers,” discounting inventory to reduce stock will become a major pressure on dealers’ profit margins.

However, due to the pressure to meet targets, many dealers will still continue to import goods. This could lead to an even higher overall inventory level before the Lunar New Year.