DONGYING, ChinaShandong Deruibo Tire Co. Ltd., producer of the Deruibo, Allroad, Jaderock and Faralong tire brands, has declared bankruptcy and has been taken over by local government for liquidation, the secretary general of China Rubber Machinery Association (CRMA) has confirmed.
The company is considered the world's 35th largest tire maker as ranked in Tire Business' annual Global Tire Report, with $992 million in fiscal 2013 sales. It announced the bankruptcy in February following an appeal to the government for a restructuring earlier that month.
CRMA Secretary General Chen Weifang confirmed the company's situation recently to European Rubber Journal (ERJ), a London-based sister publication of Tire Business.
The parties did not offer any explanation for Deruibo's plight.
Deruibo Tirealso known in some reporting as Deruibao Tirewas set up in 2009 in Guangrao county, Dongying, Shandong province, and claimed annual manufacturing capacity of 33 million car, light truck, medium truck and OTR tires. The company claimed employment of 5,000 in its online profile.
Deruibo Tire was not listed separately among companies receiving a specific anti-dumping rate in the pending U.S. anti-dumping investigation by the International Trade Commission and therefore is considered to be subject to the highest rate, 87.99 percent.
Shandong Haolong Rubber Tire, another tire arm of Deruibo's parent Shandong Haolong Group, received a preliminary 27.7-percent rate.
Shi Yifeng, secretary-general of China Rubber Industry Association's tire sub-commission, told ERJ: There are bound to be a reshuffle in the sector due to reasons such as over-expansion. It's not fair to say the U.S. anti-dumping tariffs are the trigger.
According to a story by China Chemical Industry News, Deruibo had obtained about a 900 million yuan ($131 million) guarantee since 2010 from Chinese companies in the rubber sector, including Qingdao Doublestar, Tianjin Saixiang Technology, Mesnac and Greatoo. Concerns had been expressed about the impact on those companies.
Jane Ho is a correspondent for European Rubber Journal, a sister publication of Tire Business.