German 'declaration' urges government to protect tire industry

Kassel, Germany – German trade unions and works councils have called on the federal government to provide measures to protect the tire industry in the country, including support for antidumping duties against Chinese tire makers.

In a 4-page declaration signed 8 March, some 40 representatives from trade union IGBCE and local works councils called on the politicians to ‘create the right conditions’ for the survival of the tire industry in the country.

The document, signed during a two-day ‘tire works’ conference in Kassel, noted that “good money” could still be made in the German tire industry.

“We want tires to remain a high-tech and future product in Germany as an industrial location,” said IGBCE board member Francesco Grioli.

Furthermore, Germany as a location provides advantages such as “knowledge, experience and skills” which Grioli said should not be “thrown out of the window.”

Citing planned factory closures announced by Michelin and Goodyear last year, IGBCE said the German tire industry is being threatened.

"Four of the twelve existing tire factories are to be closed in the coming years and a total of 3,300 jobs will be lost," it noted.

Michelin’s case, said the declaration, is ‘explicitly connected’ to cheap truck tires in the European market, mainly originating from China.

Such truck tires, it added, are “sold below [production] cost, even with significantly cheaper retreading, and cannot be rivalled by [local] companies.”

The IGBCE said it has offered to participate in the extension and expansion of antidumping duties by the EU on such products.

Goodyear's management, on the other hand, has referred to the high costs and overcapacities in Germany as its reasons for closure.

At the same time, IGBCE said Goodyear repeatedly emphasised last year that it did not need “a bridge price”.

“For us… this is not a credible strategy. We know that in parallel, the expansion of production in Eastern Europe is being prepared,” it added.

Aside from its impact on “a third” of the industry, the cuts are “a completely out-of-proportion reaction,” according to Grioli.

“It's difficult to understand because the industry is managing to operate profitably overall, despite the challenging environment and significantly higher producer prices,” Grioli added.

According to the statement, Pirelli is a good example showing that profits can be made with passenger car tire production in Germany.

“The gross value-added [in the industry] remained almost stable at 28%, despite the Corona years and despite the war in Ukraine,” it said.

Personnel, material and energy costs, it went on to add, are “also not plausible reasons for the closure or relocation of production capacities and plants”.

In order to keep tire production in Germany, IGBCE and works councils suggested that companies should invest in “ecological and economic competitiveness” rather than plant closures.

These, it said, include research and modernisation of systems as well as conversion to renewable energy sources.

The 'Kassel declaration' also called for closer cooperation with German car and truck production sites in order to fully exploit efficiency potential.

“It makes sense to integrate the research departments of the OEMs even more closely with those of the tire manufacturers,” it said.

The proximity of the Goodyear factory in Fuerstenwalde to the new Tesla factory, for example, could be an ideal option for efficient just-in-time delivery, the statement added.

As for political support, the unions called on the EU and the federal government to provide the necessary industrial policy framework to support the industry.

“We demand from federal politicians to advocate within the EU for the extension of anti-dumping measures on Chinese truck tires,” said the declaration.

Furthermore, the unions asked that “circumvention of the punitive tariffs through imports from other Asian countries” should also be excluded.

The federal government was also urged to launch investment programmes to promote the development of new generations of tires for future mobility in Germany.

This, it said, would also benefit other industries in the supply chain of the "strategically important" automotive industry in the country.