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Tyre foreign companies double environmental standards when prohibited
China has become the world's largest tire producer, with its global market share steadily rising each year. The Chinese tire market is growing at an annual rate of over 20%, prompting multinational tire companies to intensify their presence in the country. These corporations have poured significant investments into local factories, localized research and development, and expanded retail networks, leading to substantial profits. However, this rapid expansion has also resulted in resource wastage and severe environmental pollution.
Competition among multinational tire companies has intensified, especially in the retail sector, which accounts for two-thirds of all tire sales. Market share in this segment largely depends on the extent of a company’s network coverage. As a result, expanding sales channels has become a key strategy for these firms. They are accelerating their expansion efforts to gain a competitive edge.
Goodyear was the first major international tire brand to enter China. Recently, it shifted its focus toward sales channels, business models, and after-sales services. Within six months, the company opened 300 retail franchise stores, averaging two new locations per day.
Michelin has invested over $400 million in China to capture a larger market share. It now operates factories in Shenyang and Shanghai, with more than 300 dealers, adding around 100 new dealers annually. Bridgestone, too, has significantly increased its investment in China, becoming the world's largest tire company to build manufacturing facilities there. A single factory in Huizhou required an investment of RMB 5 billion, causing considerable industry shock. In addition, Bridgestone has developed a large testing ground in Yixing, Jiangsu, covering 839,000 square meters.
Hankook also considers China as its most important market and has established factories in Jiaxing and Jiangsu. It currently holds a leading position in the Chinese car tire market and aims to open 300 franchise stores within five years. To further strengthen its position, Hankook has launched a full-vehicle production line, expected to produce 60,000 tires annually.
Despite their economic success, multinational tire companies have caused serious environmental damage. Many failed to implement the “three simultaneous†system during construction, leading to improper wastewater discharge and unauthorized pollution control measures. This has led to a sharp rise in environmental violations.
In January 2007, Michelin’s subsidiary in China was penalized by the State Environmental Protection Agency for multiple violations, including uncompleted desulfurization and dust removal systems, excessive emissions, and noise pollution. Despite being ordered to correct these issues, Michelin delayed its response, resulting in another warning later that year.
Industry sources note that tire production involves numerous chemical intermediates, and without strict controls, it can lead to severe environmental harm. The pollution incidents involving Michelin and others highlight this risk. Some companies argue that cost pressures—due to rising raw material prices and demands from automakers to cut costs—have reduced their environmental investments. However, many foreign tire brands, such as Bridgestone, Michelin, and Goodyear, have raised product prices by 3% to 5% in recent years, allowing them to offset costs and even increase profits.
This profit-driven approach, combined with a lack of environmental responsibility, has contributed to pollution in China. Multinational companies often adopt different environmental standards in developing countries, following stricter rules at home but relaxing them abroad. This double standard has led to growing concerns about corporate social responsibility.
Environmental experts suggest that addressing this issue requires improving legal frameworks, ensuring equal treatment of domestic and foreign enterprises, and strengthening supervision and penalties. Closing illegal foreign-funded enterprises and curbing local governments’ preferential policies for multinationals are essential steps toward sustainable development in the tire industry.