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INDIA
being a major auto hub.
The virus hit the industry so hard that one of the biggest retreaders in Maharashtra, the Mumbai headquartered Tyresoles, has been forced to re-draw its operational strategies. The retreader had been operating multiple sites in a variety of states including in Belgaum (Karnataka), Jabalpur (Madhya Pradesh), Ahmedabad (Gujarat), Hyderabad (Telangana) and Erode (Tamil Nadu). However, the almost six-month long lockdown period has made it virtually impossible for the company to operate all its diversely located factories profitability.
“We have decided to move out of the Telangana and Tamil Nadu market and consolidate operations at Belgaum, which is one of our biggest retread operations,” confided Karun Sanghi, Managing Director, Tyresoles India Pvt Ltd. The retreader and tread rubber maker had already moved the machinery from its Hyderabad and Erode sites to Belgaum in the middle of 2020. Tyresoles had been retreading about 20,000 tyres per month when all five sites were operational. However, with only three factories currently operational, production has come down to between 13,000-14,000 tyres each month.
“Now, our installed capacity post consolidation is in between 25,000 – 30,000 tyres each month but we are functioning at 50% of the installed capacity,” said Sanghi. Tyresoles also has a captive tread making site in Mangalore, producing about 200 tons of
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tread to feed its own retread operations.
Now, however, the rising cost of raw materials is posing another challenge for the retreading industry. “The market is staring at lot of issues like the shortage of carbon black, an important ingredient in the tread rubber production. Moreover, its prices are skyrocketing and are up by 200% due to shortages,” Sanghi complained.
The shortages have led to the closure of several factories engaged the rubber related
businesses. It has also been noted that carbon black producers are shipping production abroad to meet their earlier commitments, leading to shortages in the domestic market. The outbreak of Covid-19 has also led to supply chain disruption. “We have stocks until April but we do not know what will happen if supplies remain short and prices continue to remain at an all-time high,” said Sanghi.
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