Routes to Growth shares the experience, knowledge and success of UK businesses in China and South-East Asia.

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Manufacturing

Rise of the robot tyre-makers

21st Mar '16

An explosion in technical capability and use of artificial intelligence mean Chinese factories knock spots off European equivalents, says Hugh Wilson

Company: Davanti Tyres Sector: Automotive Manufacturing in: China


"It’s the quality, that’s what we get from China. You might not have said that in the past, but you certainly say that now"

When a well-established tyre wholesaler based in England’s North-West wanted to establish its own brand, it chose China for its production base.

“We knew China well, because Oak Tyres has been representing Chinese tyre brands on an exclusive basis for many years,” says Sean Maddocks, sales director for Oak subsidiary Davanti Tyres.

“And what we knew as a result was that in the last six or seven years there has been an explosion in technical capabilities in China. We know that China now has some of the most advanced factories in the world.”

Davanti explored manufacturing options across Europe and Asia before choosing as its manufacturing partner Sentury Tire, which has a plant in Qingdao. Maddocks insists that ‘state-of-the-art’ barely does it justice.

“Before Davanti I worked for a very large tyre manufacturer and this factory knocks spots off the equivalent European factories I’ve visited,” he says.

The production process is run almost entirely by robots, controlled by sophisticated artificial intelligence. Most human staff are programmers, but once programs have been written the factory largely looks after itself. For example, the artificial intelligence will sense flaws in the production process and takes autonomous decisions on the best way to resolve them.

Peter Cross and Sean Maddocks reviewing test results at IDIADA in Spain

What a performance: Peter Cross and Sean Maddocks review Davanti test results

The factory is an example of the much vaunted ‘Industry 4.0’, a manufacturing leap which promises a much higher level of digitisation and automation than anything seen up to now.

The sophistication of the factory has other advantages for Davanti. The brand was launched last May but already offers 160 sizes of tyre, and expects to be selling over 200 by the end of 2016. The range includes tyres for a standard family hatchback as well as more specialised products – for commercial vans and black cabs, for instance. Hi-tech production facilities make adding to the range relatively straightforward.

“The old perceptions are dated,” says Maddocks. “You can still find the ‘bad’ China if you look for it – small factories making poor-quality products. But at the top end the new China is world leading.”

Finding those top-end partners takes time and effort. Despite Oak’s considerable experience in China, Davanti spent two years researching potential partners, meeting executives and touring factories before its launch in 2015. “If I had one tip for others wanting to set up operations in China it would be just that: research your supplier,” says commercial director Peter Cross.

“That should include facets such as financial health, product quality, their loyalty to customers and their management structure. You have to get to know who the decision maker is and what their objectives are for the relationship.”

Trade shows have played a part in both Oak’s success and the development of Davanti. The first contact with Sentury was at the annual SEMA (automotive products) show in Las Vegas.

Davanti was launched at Autopromotec in Bologna last year before exhibiting at Citiexpo in Shanghai, a major international tyre-industry show. Davanti’s global expansion will be further boosted by representation at seven more international trade shows in 2016.

Cross believes that trade shows are an excellent way to meet potential partners, but also that they should be very much the start of the journey rather than the end. Both parties have to work hard to make the relationship work. “Gaining the respect of the supplier was vital to forming the partnership for us. This took time and a lot of demonstrating that we do what we say we will do – they could trust us. Until this respect was gained, it made communication difficult in the earlier stages,” he adds.

Davanti Tyres 1Cross continues to travel to China four times a year and Davanti now employs three staff in China out of a total workforce of 10, as well as Chinese speakers in the UK office.

The company’s commitment to a relationship with one of the world’s most advanced tyre manufacturers seems to be paying off, even if it is early days for Davanti. The company projects a £10 million-plus turnover for its first full year of trading, and now distributes across the UK and into Malaysia, New Zealand, France, Spain and the French Caribbean, among others.

“It’s the quality, that’s what we get from China,” says Maddocks. “You might not have said that in the past, but you certainly say that now.”

www.davanti-tyres.com

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