SHANGHAI -- As China's auto market slows, some tire makers are cutting expansion plans and relying on aftermarket sales to support demand.

 

"Growth was at a slower pace than earlier and were weaker post the Olympics," says Goodyear's Darren Wells, executive president and chief financial officer.

 

In response, Goodyear is closing its plant in Australia and has bought out minority shareholders in its China business.

 

Two tire makers that started slowly in China, Pirelli Tyre Co. and Yokohama, are now glad they did not build huge plants.

 

Giuseppe Cattaneo, CEO of Pirelli Tyre Co (China) says: "Being not too involved -- so far -- in the OE business [in China], we are keeping to our original plan for 2009. No special actions."

 

Earlier this year Pirelli said it is investing $100 million (then 681 million yuan) to double capacity in China. By 2011 the Italian tire maker will have capacity to make 11 million tires annually.

 

Meanwhile, Yuji Sakamoto, a planning executive at Yokohama Rubber (China) Co., says, "At the moment we have no plan to cut back on production in China, because our production capacity is not enough for the demand  for our brand tires."

 

With a $25.4 million (174.6 million yuan) expansion recently completed, Hangzhou Yokohama Tire Co. can make 300,000 passenger car tires per year. A fourth phase expansion is expected to begin next year.

 

"Luckily our factory is not too big as [are] the other tire manufacturers" in China, says Sakamoto. "So we are not changing our plan now."

 

Domestic tire maker Shandong Linglong Rubber Co. is cutting production, depending on the market, says Jiang Guibo, a senior executive at the tire maker.

 

"Now the market is bad," he says. "We do [production] plans monthly."