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LITHUANIA
retreading operations using the cold technology.
According to him initially the retreading of tyres was seen as a new thing for the region, but the company steadily developed and soon managed to expand
includes the presence of cheap Chinese tyres in the market as well as the fall in transit cargo traffic from Europe to Russia. As a result several huge clients of Motorida have left the country and were not planning to go back.
reached above 6,000 tyres, while the prospects of 2017 remain unclear yet.
In terms of technology Motorida is working with Nokian and, according to Lakneris, this was because the company from the first days was building up business basing on the cooperation with Finland Euromaster. In the course of the past decade Motorida also started using raw materials and technology from Kraiburg.
“In order to cut costs the company in the last two years has refused to purchase casings from abroad. We put some effort into this and in general we succeeded to collect casings in the domestic market. The price difference between imported casings and casings in the domestic market is not huge, but the problem is that you need to pay the
“On the other hand, there are several huge clients, who have been using Chinese tyres for some time, and when they estimated the costs, the mileage, the fuel spends and other factors, they decided to shift back to the use of retreaded tyres. So, we believe that this trend could become common and some time should pass before the other transport companies evaluate the economic benefit of the use of retreaded tyres compare to Chinese products as well,” he suggests. Rolandas Turskis, Motorida service director explains that in the competition against Chinese tyres there are certain leverages the retreading businesses can use. In the first place, this is about the inability of Chinese tyres to operate at the winter roads. He explained that there were numerous clients of
Valdas Lakneris, a director of Motorida
production capacity. The organisational structure passed through serious changes over the past decades, as Euromaster left the company nearly ten years ago, because of the changes in the company’s investment strategy. However, last year it returned and a
“At one point Chinese tyres in Lithuania were even slightly cheaper than retreaded tyres, though now the prices for Chinese tyres have started growing. I cannot say for sure if this is a long-term trend and, of course, retreading is rising in price as well,” Lakneris says.
Rolandas Turskis, Motorida’s service director
new partnership agreement has been signed.
The past few years for Motorida were problematic, Lakneris admits, saying that there have been a lot of reasons for this, and most of them are well-known for the market. This
The comprehensive problems in the market have forced the company to cut production volumes. According to Lakneris prior to 2015 the company was producing up to 10,000 tyres per year. In the past two years this figure has not
utilisation fee for the import of casings and also to pay for carriers who will deliver it to your facility,” Lakneris explains.
According to company’s estimates, in 2016 Motorida retreaded roughly 70% of its tyres on a COC basis and only 30% or about 2,000 units using stock casings. The company now collects casing on average at the price of EUR 25-30 per unit, depending on the size, and offers retreading of the casings of the client at EUR 110-115 per unit. “We are not working with cheap casings and with Chinese casings still very prevalent this could in future become a problem, because the share of these casings in the domestic market is steadily growing. Still, there are some new trucks purchased by local carriers, and they are coming with the new premium tyres, which are a perfect fit for retreading, so at the moment we do not have a problem with the lack of casings,” Lakneris notes.
the company who moved to the use of Chinese tyres and discovered that in the roads of Northern Europe they are simply “falling to pieces”. “There are numerous Lithuanian companies operating in Norway and other countries of Scandinavia and they have already burned their fingers on Chinese tyres, so now they are putting only good new or retreaded tyres for the driving axle in order to prevent incidents. The drivers have simply started to refuse to drive north on Chinese tyres for the obvious reasons,” Turskis says. So this is a very encouraging thing for Lithuanian retreaders, as it seems that the clients are beginning to wake up and not chase a quick- fix profit any longer. This raises some hopes that the market for the retreaded tyres in Vilnius has already hit the lowest point and their is one way for further development – upwards.
36 Retreading Business