Pirelli’s challenge in the United States has little to do with how its tires perform. The real issue is who owns the company, and regulators in Washington are watching closely.
Sinochem, a Chinese state-owned enterprise, holds more than one-third of Italian tire manufacturer Pirelli. US rules aimed at limiting Chinese-backed automotive technology could put Pirelli’s access to the American market at risk.
The Italian government is positioning itself behind the scenes as both mediator and safeguard.
For drivers who prioritize performance, Pirelli is a familiar and trusted name. Whether on premium road cars or at the pinnacle of motorsport in Formula 1, the Milan-based company has built a reputation around high-end tires and proprietary innovations. To most buyers, Pirelli appears unmistakably Italian in both brand identity and legacy.
What often goes unnoticed is that Sinochem, a Chinese state-controlled chemical conglomerate, owns roughly 34 percent of the company. As the US prepares to implement new regulations targeting Chinese-backed technology in vehicles, Pirelli could find itself effectively shut out of the American market unless its ownership structure changes.
Pirelli’s US business is not focused on low-end products. The company primarily sells premium tires infused with advanced, in-house technology, precisely the type of offering that is now drawing increased regulatory scrutiny.
Executives have examined ways to limit Sinochem’s influence, including discussions around divesting the stake, but no decisive action has yet been taken.
The Italian government has been involved behind the scenes for some time, and pressure is building again. With US restrictions expected to take effect in March, Rome is prepared to intervene if negotiations fail to make progress.
Under Italy’s so-called “golden powers” framework, the state can restrict foreign shareholders in companies considered strategically sensitive. That authority has already been exercised once.
In 2023, Italy limited information sharing between Pirelli and Sinochem and increased the voting threshold required for major board decisions, citing concerns over the protection of sensitive technological know-how.
If talks collapse entirely, Italy could escalate matters by suspending Sinochem’s voting rights altogether. Officials would prefer to avoid such a move, instead seeking a compromise that preserves Pirelli’s competitiveness without triggering a broader diplomatic clash with China.
The United States generates close to 20 percent of Pirelli’s total revenue, making it far too significant to sacrifice lightly. It is also one of the most important markets for premium and performance tires, where profit margins are stronger and brand reputation carries greater weight.
Being pushed out of the US would do more than dent revenue, it would undermine Pirelli’s standing as a global leader in tire technology. That reality explains why Italy is prepared to step in and why solutions that once seemed unthinkable are now under serious consideration.
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