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LATVIA
per cent in the overall structure of sales, while 75 per cent is still sold in the domestic market.
“In terms of exports we are supplying our retreaded tyres to Russia, Norway and other Baltic States. We also try to get to the Finland market, as we have been participating in one of the local agricultural expos, and hope that we will have some progress in this area in the nearest future,” he suggested.
Efficiency improvements
Re-equipping at the end of last year cost Juva EUR 660,000 and allowed the company to increase overall production capacity. According to Lukjanov, in 2015 the company produced 7,000 units of retreaded tyres, while the target for 2016 is about 10,000 tyres. At the same time, of key importance is the fact that Juva has managed to significantly increase operational efficiency and reduce man hours per unit of retreaded tyre.
“First of all, we have managed to install two new autoclaves to replace the one old. As a result, we have two installations for vulcanising now, and in general we have more modern equipment now than we had previously,” added Kucins, stressing that Juva is applying the technology of Kraiburg with the additional protection of the sidewalls.
“We have improved the security of the technological process. Also, previously we had one vacuum station per whole production line, so in the case of any breakdowns it brought a lot of problems to the retreading process. Now we have two vacuum stations, in other words one station per autoclave,” said Lukjanov.
This increases the efficiency of the whole production system by nearly three times, according to Lukjanov. “We can safely say that this is equipment of the new generation, which offers a reduced number of errors in the autoclave, a more stable temperature regime and a digital controller with sensor screen. Previously a lot of tasks had been conducted manually: Now, everything is controlled by a computer. The new autoclaves will maintain the appropriate operation even if you try to screw up something,” jokes Lukjanov.
Changes of operating process
In the past, explained Kucins, the biggest production volume Juva ever had was 1,400 tyres per
month, and this was the biggest monthly volume of production among all Latvian retreaders. At the same time, the company previously had to operate in a very limited workshop territory and it was rather complicated.
“Our workshop place was very small and it is located only at the ground floor of our centre. If we compare it with other firms, some of them have hectares of territory. We took the decision to expand production capacity by taking some space from the warehouse. As a result, the overall territory of the workshop rose by nearly double and now amounts to 700 square metres,” Kucins estimated.
“Our factory probably was the smallest one in Latvia for a long time - in terms of occupying area - at the same time accounting for largest volume of production in the country,” he added.
The expansion of space for the production line was in general part of the re-organisation programme the company introduced at the end of last year.
“In terms of casings, up to 70 per cent are casings of our own clients. In the autumn we will also launch production on our own casings, as we import them from Germany and from the Netherlands,” he said.
Faith in better times
Juva executives believe that the dark times in the country’s market will soon come to an end, as the domination of Chinese tyres in Europe should not last much longer, especially if some actions are taken at government level. “Chinese imports are really strong, but we hope that this situation with the dumping of all Chinese tyres is a temporary thing, since, as we know, Germany already has some subsidies to clients who purchase retreaded tyres, while many other countries have anti- dumping duties against cheap Chinese tyres,” said Kucins.
“These are U.S., India, Brazil, but only Europe so far has not applied any measures in this regard. You probably know that BIPAVER is trying to support some restrictions in the European Parliament. We are living with the hope for the future and continuing active work,” he added.
In addition, Juva spokespersons estimate that at the moment the price of their tyres with premium casing and premium tread exceeds the price of Chinese tyres by up to 15 per cent, thus there is a clear
tendency for the rise in prices for Chinese products.
According to Lukjanov, those clients who carefully estimate prices are still purchasing retreaded tyres, since they may possibly cover a distance nearly twice that compared to Chinese tyres, so their
purchase is saving clients’ money. In general, this is the key of Juva’s faith in better times – that at certain points clients will understand the benefits of their tyres compared to cheap alternatives.
Riepneks Maintains Stable Business in OTR Sector
There is probably no better time to understand how important it is to have your own market niche than during a crisis. Latvian firm Riepneks SIA specialises in retreading off-the-road (OTR) tyres and, being the only such retreader in Latvia and probably the largest company in this segment in the region, the company is maintaining a stable position, even amid the overall crisis in the industry.
Riepneks is a unique company within the Latvian retreading industry. Located 100 km away from Riga, it occupies several industrial buildings just as large as the tyres it is retreading here. In the past the overall area of 7,000 square metres belonged to GAZ, where more than two
manages to operate at a profit. Riepneks director Ildis Kokins is a veteran of the Latvian retreading industry. According to his own words, he had been engaged at the plant for several years even before the collapse of the Soviet Union, in the position of Production Manager. “Riepneks was established in 1994. When the country broke apart, work at the plant was suspended. I rented this facility and started to conduct retreading, but with the use of the hot cure method. “Originally, we were focused on the retreading of passenger and truck tyres and were not performing the retreading of OTR tyres,” he explained.
He added that in this period, the
Riepneks’ Ildis Kokins
decades ago there were workshops for repairing tyres for Soviet cars.
Some market participants jokingly say Riepneks has left a lot of things unchanged since the Soviet times. It is really located in old buildings with a clear need for capital repairs in some particular places. However, despite this fact, the company operates using modern equipment and, more importantly, and unlike some other retreaders in Latvia,
company’s range of tyres was fully within Soviet standards as well as the technologies they applied. However, things changed quickly, when the retreading of passenger tyres turned out to be no longer profitable, Riepneks decided to purchase a new autoclave with the ability to conduct the retreading of OTR tyres.
“As a result, over the past 10 years we have been specialising mostly on this segment, working with diameters from 50
44 Retreading Business