Page 25 - RB-59-11-4

SRI LANKA
Sri Lankan Retreading Industry Expects Growth
Satnam Singh
When I visited few years ago, Sri Lanka was fighting a bloody insurgency in the Northern part of the country. The Tamils in the North were asking for secession and a separate homeland and the Sri Lankan government wanted them to fulfil their aspirations inside the Sri Lankan constitution. Now that the war is over, the insurgency crushed and tourists have started pouring in from all over the world the hotel rates have almost doubled compared to my previous visit. Tourism is picking up once again in Sri Lanka. Now, Sri Lanka is bidding for the Commonwealth Games 2018 and it is going to be US$ 5 billion project to set up the infrastructure. A lot of commercial and construction activities would get a much needed boost if the country wins the bid.
Northern Province – A new opportunity
It has been observed that Sri Lankan entrepreneurs are awaiting the go-ahead for the improvement of the infrastructure in the Northern part of Sri Lanka. The Northern part was cut-off from the rest of the island nation for almost three decades and now local entrepreneurs are looking at the region with a lot of interest. “With the war over, the Northern area is open and a lot of commercial activity has picked up in the region. The road infrastructure is improving and truck movements have picked-up in the North and North East. We believe it will positively affect the retreading market in the future,” agreed K M Mathew, Project Manager, MRF Lanka Pvt Ltd. One retreading operator, Northern Industries has already opened its closed plant.
I thought Sri Lanka was a small
country and that the retread factories were not so far apart. So I restricted my visit to just four days. However, when I started visiting the retreading units, the four days was too short a time to make it to a dozen plants. I had to travel almost 50 kms from my hotel to visit a retreading plant and sometimes even more. With tourism picking-up transport costs have also climbed, the taxi drivers are asking exorbitant amounts for travelling to even the nearer destinations.
Retreading industry strengthened on Auto boom
Interestingly, the Sri Lankan retreading industry is expanding; market leaders like Richard Peiris, AMW and 3K Holding are increasing their capacities to consolidate their market shares.
“Sri Lanka is a 100,000 retread tyre market per month,” claimed Ananda Caldera, President, Sri Lanka Tyre Retreaders Association. Moreover, the market may further expand as peace returns to the country and there is a reduction in import duty of almost 100 per cent. As a result the vehicle population has jumped by over 50 per cent. “Previously, the duty was 300- 400 per cent depending upon the kind of vehicle imported. The vehicle boom in the country would naturally bring more tyres for retreading,” Ananda said.
Franchise network promoted by 3K holdings
While Sri Lankan company 3K holdings is running a franchise network with fair amount of success, the Indian company Treadsdirect, known globally for its franchise networks, entered the open market last year.
A Link Between 2 Industries

No.350, Jalan Haruan 7, Oakland Industrial Park, 70200 Seremban, Negeri Sembilan, Malaysia. (Marketing) Tel: +606-763 3789 Fax: +606-763 8789 (Engineering) Tel: +606-763 9889 Fax: +606-763 9789 E-mail: acten@actengroup.com.my Website: www.actengroup.com.my
®