Bekaert — PMI & Steel Wire Cycle

Bekaert is the world's largest independent steel wire transformation company — drawing, coating and fabricating steel wire into tyre cord (steel belts in car tyres), sawing wire for semiconductors, hose wire, fencing and construction products. Operating in 40 countries with 21,000 employees, Bekaert's revenues follow the global PMI cycle through its tyre cord (automotive), construction wire and industrial wire applications.

Tyre Cord: The Automotive PMI Link

Bekaert's largest segment — steel tyre cord — provides the structural reinforcement in every radial tyre. When global vehicle production rises (PMI-driven), tyre production increases proportionally and Bekaert's tyre cord volumes follow. Chinese tyre production — the world's largest — is Bekaert's most important single market. When Chinese auto and tyre production expands, Bekaert's Asia revenues accelerate.

Sawing Wire: The Semiconductor Cycle

Bekaert produces diamond-coated steel wire used to slice silicon ingots into wafers for semiconductor manufacturing. This niche product follows the semiconductor capex cycle — when chip fabs invest in new wafer slicing capacity, Bekaert's sawing wire orders rise. The semiconductor sawing wire segment provides a technology-sector demand layer independent of the construction and automotive PMI cycle.

Construction Wire: The Infrastructure Demand

Bekaert's construction products — fence wire, concrete reinforcement wire, pre-stressed strand for bridges — follow infrastructure investment cycles. Government infrastructure spending programmes (US IIJA, EU Cohesion funds) drive construction wire demand. This infrastructure segment provides some cycle diversification from pure automotive PMI exposure.

Emerging Market Manufacturing: The Cost Advantage

Bekaert operates steel wire facilities in China, India, Brazil, Southeast Asia and Eastern Europe — benefiting from lower local labour costs and proximity to fast-growing tyre production markets. This emerging market manufacturing base provides competitive cost positions versus Western competitors and captures the structural shift of automotive and tyre production toward Asia.

Key Risks

Chinese competition in tyre cord — local Chinese producers expanding capacity — is compressing global market share and pricing for Bekaert. Tyre cord is a commodity-adjacent product where cost leadership is essential and pricing power is limited. PMI downturns rapidly reduce tyre production and cord orders. Steel wire input costs follow HRC cycle movements.

Cycle Performance Summary