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ESTONIA
“Three Snowflakes” – and that all retreaded tyres with certificated winter treads must carry that mark as well. This mark means that the tread fits the harsh winter conditions of the northern highways.
Shortly after the law was adopted, several Estonian transport companies were fined in Norway, although their tyres were carrying
the Three Snowflakes. It turned out that when the tyres are retreaded, the Three Snowflakes should be put not only on the tread, but also on the casing, which means that only special casings are approved for the tyres on Norwegian roads. This is the new requirement Estonian retreaders will have to deal with in 2019.
solution from Kraiburg, envelopes from Italian-based MAE, patches from Tech and some materials from a Polish supplier.
On the other hand, retreaded tyres are only a part of the business for Veguma. The second part is tread strips the company produces at the same plant and sells both in Estonia and abroad.
“We produce on average 20,000 tread strips per year now. We export them primarily to Russia, and in this direction, we see a strong expansion potential. We can reach out to the markets of the Baltic countries, Scandinavia and other European Union member states,” Kalinkin said.
On the Russian direction, Veguma exports its tread strips all over the country. There are clients in the North-West federal district, near St. Petersburg, in southern regions, near Sochi, in Siberia and even near Vladivostok, which is, for instance, almost 10,000 km away from the Russian border with Estonia.
“In the rubber tread strips segment, the Russian market generates around 30% profit for the company, although in physical terms sales are higher there compared to Estonia. The reason is a continuing downward rally of the exchange rate of the Russian ruble. As the result, the average margins on sales in Russia both on retreaded tyres and tread strips is lower, compared to the European Union,” Kalinkin said.
In Estonia, Veguma sells not so many tread strips. In fact, the only customer is a local retreader Urmas Rehvid. This is because most retreaders in Estonia already had long-term agreements with other suppliers by the time Veguma returned to the market, according to Piller. This is not likely to change in the coming years, so the company is not considering increasing sales of treads in Estonia as its main priority.
Touching the sky
So far, Veguma has been considered itself as a supplier of tread strips with medium quality and mileage, Piller added. The product has rather good price-quality ratio, and for this reason it enjoys high demand among retreaders. However, at the moment a major R&D project is on the way at the plant, in order to design new tread strips with a premium quality.
“Once this goal is achieved, we will be able to expand our sales network and get to the new market segments,” Piller claimed.
In order to design a better rubber composition formula and respectively improve the quality of tread strips, Veguma has recently hired a new chief engineer, Sergei Sedlov, who has been appointed to handle this task.
“From the point of view of receipts, the rubber composition formula for the tyre treads is not ranging significantly among all suppliers. Generally speaking, the quality depends mainly on the certain nuances of the
technological process, like what equipment is used and what this equipment allows the operator to do,” Sergei Sedlov, chief engineer explained.
“For example, now we are elaborating different options of how we could raise the wear resisting properties of our rubber mixtures. We are considering purchasing some brand-new blending equipment as well as purchasing some ready-to-use rubber mixtures from several suppliers we are currently negotiating with,” Sedlov said.
The other possible option is a contract production of the new rubber mixtures with certain properties with other plants that have good blending equipment. “The task for 2019 is to produce tread strips with the mileage ranging between 150,000 km and 200,000
Veguma: Hard Revival
Veguma is one of those few retreaders that managed to pass through seven circles of hell and came back to life. Over the past few years, this Estonian truck tyre retreader has been struggling against severe financial problems that eventually led the company to bankruptcy, and that was followed with a big fire that nearly destroyed
with 17.5 and 22.5 inches. We have three main sales markets, Finland, Russia and Estonia. All these markets have equal share in our sales,” Kalinkin said.
Veguma is working hard to expand the mileage of its retreaded tyres, according Piller. This is a part of the company’s comprehensive expansion strategy for the coming
Veguma looks to sell its own tread into new markets
the plant.
The company was saved only by the mercy of a new owner who has some faith in the retreading industry and so invested a lot of money to raise the plant back from ashes.
Originally, the company was named Regum. It was founded more than two decades ago, as a truck tyre retreader and existed until 2012, recalled Denis Kalinkin, chairman of the sales department of Veguma. At one time, its former owner was excited with out-of-the-box solutions. He was fond of various experiments, including with the rubber mixtures and those experiments did not always lead to good results.
“There were cases when the retreaded truck tyre served for only 40 metres. These things have spoiled our reputation for many years and we still struggle to change that,” says Jaanus Piller, sales manager of the company.
“At the moment, we retread around 10,000 truck tyres per year in sizes ranging from 225/70 and 335/65,
few years.
“We have a strong export programme, as we sell more tyres abroad than in Estonia. We have some targets in terms of mileage for our tyres that we would like to achieve. After that, we plan to start looking for the customers in new directions, like, for example, Germany,” Piller said.
According to Piller, Veguma has recently made the first sales of retreaded tyres to Latvia and Lithuania. In future, the markets of Finland, Sweden and Norway also look rather promising.
Veguma imports almost all its casings from Italy. Around 10%, primarily in less widespread sizes, are imported from Scandinavia. Although, the company is accepting clients’ casings, it basically does not take casings from Estonia. According to Piller, the reason is simple – because it is impossible to find anything with sufficient quality on the domestic market.
As for the raw materials, Veguma purchases some products like cushion gum and vulcanising
Kraiburg has long been a partner for Veguma
52 Retreading Business