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As online shopping increases, deliveries turn to LCV instead of heavy trucks
Then came along the pandemic, and Chinese manufacturing was hit; across the board, container prices sky-rocketed, and the advantage the Chinese manufacturers had largely vani- shed.
Whilst trade in Europe fell initially during the pandemic, it started to recover in early 2020 and this saw, anecdotally, a bit of a boom for retreaders as they took up some slack crea- ted by the reduced number of Chinese tyres in the market.
A CORRECTION TO THE MARKET
Jorge Crespo at Vaculug looked at the Europool figures and whilst he agreed that there was some pressure on retreads today, he believed that it was not so much a decline in retrea- ding, but rather a correction to the market as the Chinese tyres returned in volume.
“If we look at the Europool figures,” says Crespo. “We can see that for TBR 2019, despite Covid, was a strong year with sa- lesupon2018.IfwelookatTBRsalesin2022wecanseea pretty stable market. What might be impacting in 2023, is the return of volume in Chinese tyres. This could be impacting on retreading, but in reality, it is just a reversion to the pre-Co- vid situation.”
Of course, the next driver of change in the market was Rus- sia’s invasion of the Ukraine*. We might speculate that had the initial “special operation” been successful, then things may be different in many ways. However, the conflict did hit trade between Russia, Byelorussia, Ukraine and the rest of Europe. International transport of goods both into and out of the three countries was reduced. This has hit long-haul trans- port, and sanctions and closed borders between the Russian -bloc and Europe mean that imports and exports have been
hit hard. This obviously has an impact upon the sales of com- mercial vehicle tyres and, by association, retreads.
It is difficult to get empirical evidence of the impact the war has had, but it has certainly hit prices and consumer spending across Europe, though, it is argued by some that it has hit har- der in the UK due to the additional costs and delays created by Brexit.
Every consumer knows that the official inflation figure do not match the real inflation met by consumers. Imported goods are more expensive, and some European suppliers and hauliers refuse to trade in the UK due to the additional pa- perwork and costs – the same can be said for some SMEs in the UK.
The point is that Covid, the Ukraine war, and Brexit, to a point, have all had an impact upon the market, not to mention the costs to the producers of tyres and retreads.
It is worth noting that two of the key ingredients in tyres have been hit hard by sanctions – oil, as we know, saw prices go skywards as sanctions hit, but less well known was the fact that much of the carbon black for tyres, including retreads, comes from Russia, and the sanctions hit that supply chain hard – though, as they say, one door closes and another opens – and that particular crisis has handed a boost to tyre recy- cling by pyrolysis – but read more about that in our sister ma- gazine Tyre and Rubber Recycling.
CONSUMER FACTORS
However, there are other changes that are hitting the com- mercial tyre sector. The biggest is the way we shop. Even if we were still buying the same goods as we have always bou-
ANALYSIS
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