The Tire Industry in Thailand

The Car Tire Industry In Thailand

1.Introduction

1.1 What is a car tire?

A tire is a strong, flexible rubber casing attached to the rim of a

wheel. Most of vehicle ties are pneumatic.The pneumatic rubber tire is

the point of contact between the automobile and the road surface. It

functions to provide traction for acceleration and braking and limits the

transmission of road vibrations to the automobile body.

（

http://www.britannica.com/EBchecked/topic/44957/automobile/259054

/Tires）

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1.2 What components are a car tire made of?

The main components of a tire are as follows:

（www.tokohama.com/customer service/ tire basics）

1. Sipes：Small, slit-like grooves in tread blocks that allow the blocks to

move more. This added flexibility increases traction by creating an

additional biting edge. Sipes are especially helpful on ice, light snow

and loose dirt.

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http://www.tokohama.com/customer%20service/


2. Belt：The belt is a reinforcement layer extending around the outer

circumference of the carcass under the tread. It acts like an iron hoop

in improving the stiffness of the tread area. In the case of truck and

bus tires, the belt is more heavily reinforced compared to passenger

car tires.

3. Bead：The bead area supports the extremities of the carcass on each

side of the tire. This is the part of the tire that anchors the tire to the

wheel.

4. Blocks ： Those segments making up a tire's tread. The primary

function of tread blocks is to provide traction.

5. Ribs：The straight-lined row of blocks that create a circumferential

contact "band."

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6. Shoulder ： Provides continuous contact with the road while

maneuvering.Shoulders wrap slightly over the inner and outer

sidewall of a tire.

7. Void Ratio：The amount of open space in the tread.A low void ratio

means more rubber is in contact with the road. A high void ratio

increases the ability to drain water. Whether a tire has a high or low

void ratio depends on the tire's intended use.

8. Sidewall：The sidewall on each side of the tire, between the shoulder

and the bead is the section that deflects most during running. The

rubber coating serves to protect the carcass.

9. Dimples：Indentations in the tread improve cooling.

10.Grooving：Used to create voids for better water channeling on wet

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road surfaces. It is the most efficient means of channeling water from

in front to behind the tire. By designing grooves circumferentially,

water has less distance to be channeled. Circumferential grooves

provide the shortest distance from the front to the rear edges of the

contact patch.

11.Tread：The tread is the part of a tire that contacts the road surface.

The tread consist of a layer of rubber, compounded to suit the

application purpose of the tire, and the thickness serves to protect

the belt and carcass. The tread pattern serves the purpose of

improving water drainage, providing traction, braking and cornering

characteristics and long tread life.

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12.Carcass：The carcass is the load-bearing framework that forms the

body of the tire. It is composed of rubber coated steel cords laid in a

radial direction. In consideration of the importance of a tire's load-

bearing capability, truck and bus tire carcasses are more heavily

reinforced than those of passenger cars.

13.Bead Filler： This is a reinforcement rubber that has a triangular

cross-section and which is used to increase the stiffness of the bead.

14.Steel / Nylon Chafer: The chafer fabric andmore steel cords is

wrapped around the bead section in order to reinforce it. It is

conventionally composed of steel. However, the specification may

sometimes call for the use of nylon.

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1.3 What is a car tire made of?

A tire is made of rubber, carbon black and other chemicals.

1. There are two types of rubber: natural rubber and synthetic

rubber.Nature rubber is a milky and sticky liquid in the bark of the

rubber tree. Synthetic rubber is produced from the polymers of crude

oil.

2. Carbon black is a fine soft powder created when crude oil or natural

gas is burned with a limited amount of oxygen, causing incomplete

combustion and creating a large amount of fine soot.

3. Other chemicals can produce specific tire characteristics.

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1.4 How to produce a car tire?

(http://www.siamtirecord.com/)

1. Twisting: Drawn yam is twisted in Z direction ( in the same direction

as twisting given in stretching process) by ring-twister for single-

twisting and wound up on flanged bobbins Tai-end if yam on pim for

single-twisting must be connected with yam head on succeeding pim

so that yams be fed to single-twister continuously and smoothly

single-twisted yam thus obtained is then doubled and twisted in S

direction by ring-twister for cable-twisting and wound up on flanged

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bobbin.

2. Weaving: Shuttle looms and projectile looms shall be adjusted

according to the specification of fabric required by tire manufactures.

Cable-twisted yam is woven into fabrics by picking weft and such

woven fabric is wound on take-up rollers and is stored.

3. Dipping &Streching: This stage is the most important of tire cord

fabrics production because it is in this stage that the raw fabric must

be stabilized in order to achieve the standard quality that is essential

to the manufacture of automobile tires. The most stringent process

and quality control procedures are implemented in this stage or

production which involves chemical and heat treatment. The raw

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fabric is continuously fed into a dipping machine, moving up to a

specific height, where it is dipped in latex, stretched, and heat dried

in ovens. This process facilitates adhesion of the fabric to the rubber

compound in tire manufacturing; at the same time, the fabric is

stretched under very accurate conditions of time, temperature, and

tension to modify the physical properties of the cord.

1.5 What about the new technology of produce a car

tire?

(http://www.gizmag.com/go/3603/)

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For Michelin, Tweel is a long-term vision that represents the next step

in a long path of industry-changing innovations. Fifty years ago, Michelin

invented the radial tire and there is no question that radial tire

technology will continue as the standard for a long time to come.

Michelin continues to advance the performance of the radial tire in areas

such as rolling resistance, wear life and grip.

In the short-term, the lessons learned from Tweel research are being

applied to improve those conventional tire performances. In the future,

Tweel may reinvent the way that vehicles move. Checking tire pressure,

fixing flats, highway blow-outs and balancing between traction and

comfort could all fade into memory.

2.Case analysis

2.1 Which firm will be chosen? Why?

Vee Rubber Group is chose as a case. Because it is the leader in

Thailand, in terms of the variety of vehicle tire types produced, ranging

from small go-kart to large commercial. These are carefully made from

selected raw materials using modern manufacturing technology and

processes. All group products are of the highest quality possible, and

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supplied mainly to export, but also domestic markets.

2.2 What is the background of “Vee Rubber” Group?

Vee Rubber was formed in 1977 as a manufacturer of bicycle and

motorcycle tires and tubes by CEO VItornSukanjanapong. Its sales quickly

spread throughout Asia, Western Europe, USA, Canada, the Latin

American countries, and other corners of the world. Vee Rubber has

more than 10 branches situated all over the world, now employing in

excess of 4000 people. Vee Rubber has also invested more than 100

million US dollars in its domestic market. Recognition of Vee rubber’s

outstanding performance is evidenced by the 1995 and 1998 Prime

Ministers Export Awards.

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2.3 What about business environmental issues?

1. Policy& Law in Thailand

Although many countries have implemented measures to attract

investment, foreign investors rated investment incentive and labor law in

Thailand as more advantageous compared to all other competitors. In

terms of corporate income tax rate, investors agreed that Thailand was

more competitive than Vietnam, the Philippines, Indonesia, India and

China, but at the same level as Malaysia. Comparison of Thailand's

competitiveness in terms of stability of government policy revealed that

foreign investors rated Thailand at the same level as the Philippines,

Indonesia and India. However, Thailand's competitive position in this

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business environmental

issues

government element

policy & law in Thailand

tire industry element

raw material supply

competitor

product standard

customer element product demand & product sort


area was lower than Vietnam, Malaysia and China. In terms of

transparency of government procedures, foreign investors were clearly

more confident in Thailand's government compared to the Philippines

and Indonesia, and slightly more confident than India. However,

transparency in Thailand was perceived to be at the same level as

Vietnam and China, and very much less so than Malaysia.

(2010 Foreign Investor Confidence Survey Report: Thailand Board

of Investment (BOI))

2. Raw material supply

Being one of the largest natural rubbers producing and exporting

countries, Thailand has tremendous potential to produce added value

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finished rubber products from natural rubbers, especially tires for forms

of vehicle. In the situation, Vee Rubber not only manufacture vehicle, but

supply rubber as well.

3. Competitor

In Thailand, there are many companies to sell car tires. They include

multinational corporation and domestic corporation. The brands such as

Michelin, Bridgestone, Dunlop, Goodyear, Sumitomo, Pirelli are famous

international brands in Thailand. So they are important competitor of

Vee Rubber in Thailand. But quality tires made in Thailand are cheaper

than those that have been imported from aboard. So Vee Rubber’s main

competitors are from the same country. Some of the Thai companies are

Vee Rubber, Deestone, Inoue, Hihero, Siam Rubber, Thai Sin Rubber,

Otani, Hwafong's Duro, Roadstone and Innoce.

(http://www.sonirodban.com/thailand-top-tire-exporter.html)

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4. Product standard

Vee Rubber has received awards and certifications from many

regulatory agencies such as the U.S. department of transport (DOT), Thai

industrial standards institute (TISI) and the as the Federation of motor

sports clubs of Thailand (FMSCT).

5. Product demand & Product sort

TYPE CHARACTER

V2

Classic City Style

All-Star Mileage

All-Season Performance

Sophisticated Tread Design for Low Noise, Fuel Economy and

Outstanding Value

V329Good All-Season Traction

Steel Belted Radial Reliability

V22

Intended for all Light Truck uses

On paved roads or soft tracks, V22 gives the best compromise

of grip

Shoulder ribs optimize soft surface traction

Help keep the tire clean

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Marat

The next evolution in commercial light truck tires

Zigzag circumferential grooves for excellent wet traction and

snow traction

Constant contact lugs for low noise, outstanding load carrying

capacity

Taiga Ice

Axe

Pinned for studs and LT construct W/Silica

5 large circumferential grooves Zigzag for optimum snow

traction

Multitude of horizontal grooves and wavy sipes for snow

biting and ice grabbing traction

Winter

Season

Multi-Siped Directional tread pattern provides stylish design

and confident winter performance

Zigzag circumferential grooves provide bite in snow

Silica compound featuring new ribbed

Traimat

e

For work or for fun, the traimate supports trailer loads for the

long haul

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3.SWOT analysis

1. Strengths

Thailand is the biggest country where natural rubber is planted. It

will provide enough raw material.

An amount of vehicles nowadays are increasing significantly. So, a

number of tires are demand.

Vee Rubber is a well-known brand. It has a good reputation in

Thailand. Many customers convince their quality.

The scale of Vee Rubber is so big that it has capability to bring forth

new ideas.

Vee Rubber has many affiliate companies to maintain its sale-chain.

Vee rubber produces so many kinds of tire that most of customer-

needs are satisfied.

2. Weaknesses

Compared to another corporation such as Michelin, Vee Rubber

owns less patents of a new technology.

The most of industry standards are worked out by Bridgestone.

Bridgestone is leader in the industry. In other word, Vee Rubber is

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follower.

3. Opportunities

The cost of human resource is low in Thailand. So, Vee Rubber can

produce low-price tire as a native corporation.

The new technology may make market share changed. Vee Rubber

may get the biggest market share.

4. Threats

The polity and law of Thailand is benefit for foreign capital. More

new manufactory of tire with foreign capital may be open.

The process of producing tires is not difficult. A new corporation of

tire may be open without much money and technology.

Vee Rubber have too many competitor.

SWOT ANALYSIS

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OPPORTUNITIES

THREATS

STRENGTHSWEAKNESSES

VEE RUBBER


4.Conclusion

As the number of cars is larger, the car tire industry in Thailand

becomes bigger. In this background, Vee Rubber will get some chances to

be champion in the industry. But it will face a lot of threats as well. As

one of the best well-known corporations, Vee Rubber has more strengths

than its weaknesses. In the future, Vee Rubber will go on providing and

developing a variety of products to customers.

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5.References

1. PERFORMANCE TIRES, Vee Rubber, Thailand

2. Chapter 13, Value Added Tax & Specific Business Tax, Thailand

3. 2010 Foreign Investor Confidence Survey Report, BOI, Thailand

4. http://www.britannica.com/EBchecked/topic/44957/automobile/

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259054/Tires

5. www.tokohama.com/customer service/ tire basics

6. http://www.siamtirecord.com/

7. http://www.gizmag.com/go/3603/

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The Tire Industry in Thailand

Documents

business environmental

car tire industry

car tire made

product demand

vee rubber

car tire

vee rubber

radial tire