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LITHUANIA
Vytenis Gulbinas, the managing director of Guminta
transport companies, but most of the trucks today are working in the west, coming back to the country only for technical checks once a year. These transport companies are expanding their fleets, but in large number of cases the local service companies in the west are supplying Lithuanian trucks with tyres. So on the one hand we see a rising number of trucks registered in the country, but on the other hand nothing is left for us,” he says. Gulbinas indicates that 50-60% of the company’s production is done on customer casings. 5-6 years ago the company was using a lot of imported casings, but now, due to the market situation, Guminta has moved away from import. 80-85% of new tyre sales are accounted for by Bridgestone Group brands. The company says it aims to sell premium tyres just to get those casings back or to retread them for the same clients.
“At the moment I don’t see any problem with casings, because we try to stay away from the sales of Chinese tyres. We focus on
stereotypical attitude about the products quality, but Guminta over the years has managed to change this perception at least for 30% of the market it accounts for.
“In the beginning of the year our price was right on the level of Chinese tyres. The products of our competitors were EUR 20-30 lower, compared to cheap Chinese tyres. At the same time, the market situation changes every day. In terms of quality we test 500-1,000 tyres every year, so I would say the mileage of our tyres is nearly 10% higher compared to the products of our competitors and nearly two times higher compared to Chinese tyres,” he estimates.
“Guminta now accounts for only 5% of the total business structure [of his family’s group], so sometimes we talk about that saying that this not the thing to do, not the business you should go into, but we are here, we need to stay and we still believe that the retreading business has a future. Maybe this is not the business that can earn you millions but the
Bandag quality ensures a steady market for Guminta
years, and we are happy with this anniversary. We have four shops distributed throughout Lithuania. For years we were more focused on the retreaded tyres, but because of the situation in the market in the past two years we’ve changed our operational mode, and now we are working 50/50 with retreaded and new tyres. We were producing 8,000 – 9,000 tyres per year in the past, but last year this figure was
has to compete at the market with the tyres of Marangoni and Kraiburg.
“There is no official data, but as we see we have around 30% of the market, so with the Bandag we have one of the biggest shares on the market, but the problem is within the market itself, because the market is really small and we calculated that its size is only about 15,000 – 20,000 tyres per year. The
Guminta operates a Bandag franchise, which they are very happy to continue with
only about 5,500 tyres. This year, however, I hope we will produce 6,000-6,500 tyres,” he forecasts. Gulbinas suggests that the market is quite simple in Vilnius with several small-sized companies and three big players, and every day the company
market is really specific because of the share of Chinese tyres, and it is really complicated to compete with Chinese products, especially because the market is shrinking,” Gulbinas explains.
“At the same time, we have strong
premium products, and we track every tyre that we sell, and we try to get them back, either for retreading or to purchase it as the casing. So we don’t see the same problems as we faced back in 2012 when the half of the casings in the market were imported from Western Europe,” Gulbinas notes.
“I think because of the extreme competition we now have the lowest prices for premium products in the whole of Europe. Talking about our future plans, we are planning to continue successful cooperation with Bandag. On the other hand, we are exploring future opportunities to enter markets where Bandag dealers are not yet present,” Gulbinas adds.
He also suggests that the perception of retreaded tyres in Lithuania still burdened with a kind of
market needs it. The other thing that is still crucial in Eastern Europe is the environment. We need retreading to better manage our environment and this is also why we see the future of this business,” Gulbinas concludes.
Motorida struggles against Chinese tyres
Motorida is the oldest retreading facility not only in Vilnius, but in the whole of Lithuania. The company has been operating in the retreading business since 1985, when the Finland-based subsidiary of Euromaster introduced the company’s executives to the nuances of the business. Valdas Lakneris, the director of Motorida, says that the company was the first one in the country who started
34 Retreading Business