MTD Exclusive: Triangle’s Ding on Globalization, Products, IPO and Tariffs
While in China for the 40th anniversary of Triangle Tyre, Modern Tire Dealer Publisher Greg Smith sat down with Triangle Group Chairman Yuhua Ding in his Weihai office.
The exclusive interview included a variety of topics, ranging from global sales plans and new production facilities to the company’s pending IPO. Triangle Tire USA’s Mary Ma, director of marketing, served as the interpreter for the interview.
Ding says the company currently has export sales of 58%. He did not break down export sales by country or region, nor did he answer specific questions regarding sales figures or profit figures for the company.
During the conference in Shanghai, the company reported growing from having sales in 126 countries in 2010 to 178 countries currently.
“In the next five years, Triangle will continue to stay committed to brand globalization for stable, solid, and fast growth in the global market. We will further segment the global market, continue to customize sales according to different market demands, promote global marketing and service systems, build global distribution networks, and develop a product portfolio to meet different market needs and address different consumer demands,” Ding said.
Asked about tires for the U.S. market, Ding said, “Triangle Tire USA will coordinate with A3T based in Akron, Ohio, and Weihai R&D headquarters to develop new products for the U.S. market needs and demands.”
Ding said the company is looking for long-term growth in the U.S. market and plans to focus on its Triangle brand name. He wants to achieve this growth goal through high product quality, consistent performance, and integrated market and service systems. The company is planning for continued investment in product innovation, research and development, and advanced manufacturing systems. “We must continue to build a partnership with the right customers,” Ding said.
Triangle currently has five factories, all of them based in the greater Weihai City area. Ding wants the company to have a sixth production base within three years. He further says it will not be in China, and it could be obtained through an acquisition of an existing plant or could be a new facility.
In early 2015, Triangle announced plans for an initial public offering (IPO). Ding said the IPO application was approved in January 2016, but the company is waiting for the right timing to go public with the stock. Currently, market conditions were not favorable. Ding hopes that the offering will move forward in the first half of this year. The total amount of stock to be offered by Triangle is 25%, according to Ding.
Regarding U.S. PLT tariffs, Ding said, “Triangle will focus on segments that can absorb these increased costs. On the flip side, it helps us to build our brand and shift from commodity segments to value-added segments, such as UHP.” Regarding potential TBR tariffs, Ding simply said, “There are lots of uncertainties with TBR.”
In China, Ding says that Triangle maintains a 50/50 balance between OE and replacement tire sales, but he sees this growing to a 70/30 split in favor of replacement sales due to increased vehicle ownership in China. Globally, Ding says the ratio is 80/20 in favor of replacement sales. He added that “the challenge for the U.S. market is to get more OE demand.”
Since 1995, Ding has held a strategic vision that Triangle must be a global company. He realized that China, as a nation, was not alone, and his company would need to compete on a global basis with a complete portfolio. ■