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UAE/OMAN
Towell Diversifies into Industrial OTR Retreading
Tyre Plus in Muscat Imports Brazilian Tread to Compete with Chinese Tyre Imports
Towell Auto Centre LLC (TAC) is a subsidiary of the wholly-owned W J Towell Group, regarded as one of the oldest family owned groups in Oman with diversified interests in trading and construction, automobile, telecommunication, printing and publishing.
Towell is also active in the retreading industry and runs the Bridgestone Bandag operation in Muscat, having set-up a
retreading plant in Mabela, 40 km north of the capital.
The company has recently diversified into the retreading of industrial OTR tyres up to size 35”. The expansion was carried out around four months ago as part of the company’s objective of expanding its retreading operation. “We have installed Italmatic equipment for OTR retreading, but here we are faced with the challenge of competing against new Chinese OTR tyres, which are being sold at half of our price,” said Oommen John, Assistant General Manager, Towell Auto Centre LLC.
Talking about the company’s strategy of entering into the OTR retreading sector, John explained; “The foray would further widen our product profile, in addition to which diversification would help us to sell OTR tyres, supporting our customers as well as our retreading operation.
Towell Auto Centre LLC was set up in 1972 and has the distributorship of a number of international car brands such as Geely, Mazda, Zhengzhou Nissan, Higer, JAC etc. as well as other automotive sector brands like Suzuki, SEAT, Total, Bridgestone, Mahindra and Lucas. Towell is
expanding its business activities in Oman and has opened new headquarters at Ghala in Muscat. The company says it is constantly looking for new global auto brands to make their products and services available in Oman. The 600 tyre capacity retread plant is constantly looking at new ways to improve retreading standards and its acceptability in a society that uses and then throws away tyres. “We have been facing difficulties to get casings for some time, as casings are not allowed to be imported, and good casings are in short supply locally. Retreading volumes are therefore always low,” explained John. Production has fallen to 400 tyres in recent months. “We could retread up to 40 tyres in a day on a 22-tyre chamber, but we are currently operating at much below the capacity. We only hope the situation will improve and the market revives as soon as possible,” he said. In order to counter the problems created by low priced tyres, the company has recently diversified into OTR retreading to bring in customers and open new business opportunities. Towell has a truck and tyre centre in Muscat and five fleet points to service truck tyres in various parts of Oman.
“Our fingers are crossed and we hope that oil prices will soon pick up and give the required push to the economy,” he added.
Towell Auto Center currently retails 5,000 – 6,000 tyres each month. 2014 was the company’s best year, having sold 80,000 truck tyres during the year.
Four years ago, Mohsin Haider Darwish LLC started a retread plant in Al Buraimi, an oasis town in the north-western part of Oman, on the border of the United Arab Emirates. The plant, which began production was set- up in February 2012, operates in co-operation with Michelin and follows Michelin’s Recamic process of retreading.
The factor y is strategically located on the border to cater to the markets of three nations, Oman, UAE and Bahrain. “But the plant caters majorly to the markets of Muscat, Abu Dhabi and Dubai,” informed Najmi Pocketwala, Head Retreading Division, Mohsin Haider Darwish LLC.
Like many plants in the region, the retread factor y is currently operating below capacity due to the local market being flooded by low priced Chinese imports.
“We are retreading around 400 tyres each month, but this may be difficult to improve in the near future as it has been becoming increasingly difficult to convince people to get their tyres retreaded due to cheap Chinese new tyres being easily available ever ywhere,” said Pocketwala. “A new Chinese tyre is available at Omani Rial 80 and a retread at around Rial 92. Therefore, who is going to buy the retreaded tyre?” he asked.
The plant retreaded 600-700 tyres in 2003-04 and at that time new Chinese tyres were priced at around Rial 150 but, over the years, Chinese tyre makers have continued to slash prices. “The people are coming back to us mainly due to the quality of our retreads, and we regard it as our
USP in this market,” he stressed. With markets flooded with low priced tyres, the company is
tr ying to cope with the challenge by retreading with a more competitive tread rubber. “We are importing the price-competitive tread brand ‘Ruzi’ from Brazil in order to compete with the Chinese tyres,” informed Pocketwala.
Previously, the company retreaded only Michelin brand casings using the Recamic system, but now all kinds of international branded tyres like Yokohama, Goodyear and Bridgestone are being retreaded with the Ruzi tread. “The results are good and the feedback is ver y positive from the market,” he assured.
The Muscat based partner in the retread plant has been a dealer of Michelin tyres for almost three decades, selling around 4,500 tyres each month. It has a widespread network with two Tyre Plus centres in Muscat and Hail, 10 tyre centres and 5 warehouses in Oman. It also sells OTR tyres from the Indian manufacturer BKT. Our new tyre sales are growing around 8-10 per cent each year, and even sales of OTR are also picking-up,” informed Antony Mathew, Senior Sales Executive at Muscat based Tyre Plus.
The Al-Buraimi plant is the only retreading unit being installed with a shearography machine, indicating the heavy investment made by the companies in retreading in the region.
Tyre Plus at Muscat
Oommen John, Assistant General Manager, Towell Auto Centre LLC
40 Retreading Business