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ESTONIA
but we keep working. We hope
to find new clients in Russia, and we have thoughts to go to Scandinavia, supplying our tyres to Finland and Sweden. By all means, in 2019 we plan to increase our overall production volume,” Gerasimov said.
From the very beginning, Wolf Tyres was considering Russia as one of the main sales markets. For instance, in the past few years the company on average has been selling 60% of its tyres in Russia, 25% to 30% jointly in Latvia and Finland and only 20% in Estonia. To some extent, this is because the company is focused primarily on producing winter stud-design tyres.
“For example, we are not exporting our tyres for example to Poland or Germany, because in both these countries, like in many other countries of Eastern Europe, there are restrictions on using stud-design tyres. Belarus or Ukraine has possibilities, but drivers prefer non studdable winter tyres. So as long as we produce primarily stud-design tyres, our main targets are northern countries. For this reason, in the next year our main task is to go to Sweden, and to
expand sales in the northern Russian regions”.
It is noteworthy, that in Russia, Wolf Tyres is selling tyres to more remote regions, like the Urals and Siberia. For instance, to get from Johvi to Kemerovo in Siberia, where some clients are located, the tyres have to cover around 4,200 km.
“To some extent, these logistics obviously increase the cost of tyres for the final customers, but this is always different. Some customers are getting tyres from our warehouse to deal with transport deliver y and customer clearance on their own, while others want us to cope with these tasks. In 2017, we opened our office and warehouse in St. Petersburg and so some customers in Russia are able to purchase and take retreaded tyres from there,” according to Gerasimov.
On the other hand, weak demand is considered as the only factor limiting the company’s production abilities. Basically, there is no shortage of high- quality casings, he says.
“There is only a shortage of casings in certain categories. For example, in the most popular
sizes like 205/55/16 or 195/65/15, there is no shortage and there is even a surplus. However, if we look at some other, less widespread sizes, including in R16 and R17, we might actually see some shortage. We are tr ying to collect them ever ywhere we can, but only quality ones” Gerasimov said. When it comes to casings Wolf Tyres is working only with the premium European brands. According to Gerasimov, it is a principle stance that the company is not retreading Chinese casings. Wolf Tyres is also not taking casings on the domestic market. Due to various reasons, 85% to 90% of the local casings are not appropriate for retreading.
For this reason, Wolf Tyres is importing casings from Germany, France and the Netherlands. Now there are also negotiations to start purchasing casings from Belgium and the UK.
Changes down the road
In general, Wolf Tyres anticipates that some shortage of casings may arise “down the road”, as the company will see its
production performance growing in the coming years.
“The quality of casings may be an issue. While the majority of our partners promise to keep the reject rate on casings between 5% and 7%, the actual figures usually are higher. We have rather strict requirements on casings, which is necessary if we want to produce good retreaded tyres,” Gerasimov added.
The main raw material supplier for Wolf Tyres is Kraiburg Austria GmbH. Gerasimov explained that with this company some advanced terms were achieved both on quality, payments and deliver y.
In 2015, the Eurasia Economy Union started anti-dumping duties against cheap Chinese tyres. That decision concerned only truck tyres. Gerasimov said that it would be great if some similar measures could be applied in the passenger tyre market too.
In general, the company believes that future will be bright. There is a gradual growth in demand for the retreaded passenger tyres in the main sales markets for Wolf Tyres.
“Of course, there are always