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ARC
Rajiv Budhraja, Director General of ATMA the Indian Automotive Tyre Manufacturers Association
GiTi Tyres Chris Bloor
Tai Qisheng
Stevens pointed out that new tyre volumes in North America rose from 15.7 to 18 million units between 2013 and 2015 but retread sales have stayed almost static at just under 15 million
to the unique nature of the Indian retread market, which still has a large unorganised sector, is 80% hot cure, and is still characterised by smaller retreaders with an average production of 2-300
rubber manufacturer GIIB also dealt with the issue of how to approach the market under challenging price conditions. His presentation “Retreads Future in a Price War – Environment or Profit – Or Both?” argued that the future for retreading is a four-way street – with the compounder, retreader, dealer and fleet all needing to work together in a single system.
The compounders role, said Tai, was to continuously explore new industrial manufacturing and compounding technologies to assure more efficient compounds and manufacturing processes, to optimise the set-up of the production floor, and to remove any non-value added processes. The retreader’s
responsibility, he
said, revolved
around
optimising the
process on the
factor y floor,
using the most
up to date new
generation
cushion gum to
assure optimum
bonding, to train
the people on the
shop floor to use
proper processes
and to provide
the correct advice
to fleet customers astohowtouse
the product.
According to Tai,
the responsibility
does not end
with the
retreader, though.
The dealer, he
said, has a responsibility to provide a complete offering to their customer with appropriate levels of quality and performance, to provide adequate knowledge to the customer as to how to use a new tyre and retread appropriately, and to provide added value by identifying customer issues and advising them how to maximise the use of the product.
The fleet, he added, also has a role to play in selecting the best products that are suitable for its operations and application, maintaining the vehicle and tyres by regular inspections and making sure tyre pressures are correct and training the drivers to be both vehicle and tyre friendly.
Last but not least, Chris Bloor from Giti Tyres in his presentation “Under Pressure: The Impact of
Cheap New Tyres on the Global Retread Industry” identified the four key dynamics causing the current price competition in the market. These, he said, were overcapacity in Chinese TBR production leading to brutal price competition, four years of falling raw material prices, potential indirect government support to commodity players, and a quest by commodity players to provide even cheaper products.
To illustrate his point, Bloor showed a huge list of innovation grants given by Shandong Province to manufacturers located in that region of China. He also pointed out that the difficulties in some parts of the world, and especially Europe, are likely to be
units. During this period new tyre prices have fallen, driven by growth in tier 3 and 4 brands whilst retread prices have stayed flat, so the price differential has changed.
In addition to the challenge of low cost tyres, Stevens identified a focus on up-front pricing, a misinformed regulatory environment and continued misconception issues relating to retreads as the key threats to the retreading sector.
Rajiv Budhraja, Director General of ATMA the Indian Automotive Tyre Manufacturers Association, gave an Indian perspective on the challenges of cheap tyres. Like several other speakers, Budhraja spoke about rapidly growing imports, decreasing price differentials with retreads and a stagnant retread market. However, he also drew attention
retreads per month. Despite growing radialisation, improved road consitions and an increased acceptance of pre-cure retreading, the Indian retreading sector, said Budhraja, is still an industry in search of an identity with no representative body, no data and no representation in government. Indeed, outside of the conference hall, it was clear that there was a great desire among the leading players in the Indian market, to form a trade association to represent the industry’s interests. The overall message from Budhraja was one of cautious optimism. The success of retreading in India, he suggested, depends on the pace of the growing trend towards a shift to premium CV radials backed up with the introduction of suitable retread programmes.
Tai Qisheng from Malaysian tread
exacerbated by the proposed USA Anti Dumping and Countervailing duties. The excess tyres, he pointed out, will need to be sold somewhere.
In proposing a solution Bloor drew attention to a key point – namely that for retailers, selling cheap new tyres rather than retreads is an easy sale, the inference being is that retreaders cannott rely on support from retailers. He also warned of the danger of supporting the Shandong based commodity players, but also warned against putting all Chinese manufactured tyres in the same boat. Bloor’s solution was that retreaders need to position themselves in the driving seat of the relationship with the fleet and forge closer relationships with their end-users.
30 Retreading Business
