Shandong Linglong Tyre Co. started life in 1975 when China and Chinese businesses remained a huge mystery to outsiders. Mao Zedong was still alive and leading the country, and only recently had Western leaders visited the country. The state-owned Zhaoyuan Tyre Manufacturing & Repairing Plant was officially established in Shandong prefecture, with the primary aim of repairing damaged bias ply tires and producing small lots of tires. To shed some light on Linglong, its products and its plans for growth in North America, Tire Review spoke with Alan Ye, director of branding strategy and the marketing department for Shandong Linglong Tyre Co.
Thirty-six years later, Shandong Linglong Tyre is the third largest tiremaker in its home country and 15th largest globally, posting $2.2 billion in sales, based on Tire Review estimates. Despite this rapid rise to global prominence and having become a well-known and respected brand in China, the tire company still remains a bit of a mystery to the Western world.
Tell us a little of the history of Shandong Linglong Tyre Co., and where it ranks among Chinese tire companies.
“The company has devoted itself to the development and manufacture of high quality, value-added tires. Today, the company is among the top 500 Chinese enterprises and is an accredited ‘China Outstanding Private Enterprise.’ It is also one of the three largest tire manufacturers in China and by our estimates ranked No. 16 in the world in 2010. Our production facilities cover an area of 1.1 million square meters and we have more than 5,000 employees.
“In terms of the history of Linglong, I would like to use the word ‘miracle.’ We started as a tire repair plant and have grown to the present as a professional tire enterprise with abundant potential. Linglong is really a miracle in the tire industry.
“There were two milestones in Linglong’s history. One was during the period 1987-2000, during which Linglong staff began expanding the scale, from tire repair to mass production of the bias tires. The other key period was from 2001-10, during which came a fantastic transformation when we put emphasis on the production of radial tires. During this time, too, we became China’s largest tire export company for three consecutive years and the Linglong brand value ranks at the top of the Chinese tire industry. In 2010, the sales revenue of overseas markets reached $800 million, maintaining an annual growth rate of 30%.
“During the next five years, we are faced with many new opportunities and challenges, so Linglong created a new blueprint and we are now on our way to the globalization stage. We are using technological innovation as the engine and low carbon environmental protection as our purpose, and are promoting the diversification and globalization to become a ‘resource-saving and environmentally friendly, cost-effective’ organization.”
How many tire plants do you operate in China, and what tire types do you produce there?
“There are five tire plants at our production base in Zhaoyuan, China. Each plant undertakes a different division of production, such as passenger car radial tires, radial truck/bus tires, off-the-road tires, agricultural tires, industrial tires and so on. With expanding of markets, production must expand as well, so a sixth plant is going into operation next year. Guided by the Linglong globalization strategy, we will consider building plants in other districts, including overseas, and we will choose the appropriate time to build a raw material supply base and production bases overseas so that we can form a complete system of supply and marketing, while protecting our efforts and reducing risk.
“The company has independently developed more than 3,000 tire specifications, such as for light truck radial tires, truck/bus radial tires, high performance passenger car radial tires and specialty tires.”
Other than the Linglong brand, are there other brands Shandong Linglong produces?
“Other than the Linglong brand, we also have other sub brands. With intense market competition at home and abroad, Linglong puts forward a multi-brand innovation strategy. Our three top brands of Linglong, Shanling and Leao are our competitive advantage, and we occupy the international middle- and high-end market with such brands as Infinity and Benchmark. Our brands are also popular in the market based on high performance and quality. Currently, Linglong has been one of the top 500 ‘most valuable Chinese brands’ for eight consecutive years. With a brand value estimated at 9.27 billion RMB, it ranks tops in the industry.”
How long has Shandong Linglong sold tires in the U.S. and Canada?
“More than 10 years. With environmentally friendly products as an introduction point, the company supplies international middle- and high-end markets. We are expanding our marketshare and have become a primary supplier for several major overseas automobile manufacturers. Furthermore, Linglong has been a qualified potential supplier of two global top 10 automobile manufacturers.”
What types of tires is Shandong Linglong now selling in the North American market?
“We mainly sell radial tires for passenger cars, truck/bus, off-the-road equipment, industrial vehicles and agricultural vehicles. Also, we can provide bias tires. Linglong passenger radial tires reach or exceed international first-rate level on performance and have raw materials that are environmentally friendly. Certain of our tires provide lower rolling resistance, others are environmentally friendly, and we have run-flat tires, low noise tires and wet traction tires. Linglong provides products for major automobile manufacturers in the world.”
Talk a little bit about the technological advances Shandong Linglong has made over the past 10 years.
“We invested 400 million RMB to establish the R&D center and post-doctoral workstation with first-class facilities, and we constructed the first tire noise laboratory in China. That facility has undertaken a number of national technological projects such as 863 Plan, Torch Program and others. The company has obtained more than 300 patents at home and abroad, and developed 20 new products and new technologies, which filled gaps in our domestic product offerings.
“In 2010, we received a national prize for progress in science and technology. Also, we have passed certifications from CCC, DOT, ECE, GCC, the EPA SmartWay program, INMETRO and LATU for the products, and have earned ISO9001 and TS16949 certificates for management and ISO14001 and GB/T28001 certificates for environmental management and occupational health and safety systems.
“I think the following event is worth mentioning, also. Linglong took part in summer tire testing in 2011 carried out by Test World Oy, a publication in Finland. There were some 12 global tire brands that took part in the test, including world famous brands such as Goodyear, Continental, Michelin and so on. The test report showed that Linglong was calm to drive, offered good lateral grip and was easily controllable in a handling and evasive maneuver test. The test report said, ‘Linglong was a surprise, being clearly the best Chinese tire ever in our tire tests. Linglong beat a bunch of familiar, more expensive brands.’ This is a representative example that shows the technical achievement of Linglong.”
What advantages would Linglong products give to a tire dealer who decides to carry and sell your products? What is the “Linglong sales pitch”?
“Nowadays, Linglong is being exported to more than 160 countries and regions all over the world. Linglong has created a precedent for supporting the dealer in Europe and America. In addition, as a result of its continuously focusing on brand building and quality control, the ‘Linglong’ brand name has been recognized as a ‘China Famous Brand’ and is one of the ‘500 Most Valuable Brands in China.’
“We have been an official sponsor of China’s national women’s volleyball team, a race team and a traveling soccer team. It is worth mention that Hou Yifan, member of Linglong Tire Chess Team, won championships in the Asian Games and the world championships, and is the youngest female chess champion in history.
“Also, Linglong gives support to its dealers every year, such as with promotional gifts, activity sponsorships, POP materials, a co-marketing fund, and so forth. More importantly, Linglong emphasizes R&D and product innovation. For instance, the Linglong Green-Max, a new generation of high performance passenger radial tires, which have some key features like good water evacuation, a quiet and safe ride, and low rolling resistance, can also provide fuel savings and deliver a nice driving experience for customers.
“Our objective is to become an internationally well-known brand. Thus, we will continuously invest in brand building to make sure our tire dealers and their customers can recognize and share the value of the Linglong brand.”
