Falling car sales puncture tyre companies’ hope of revival_Falling car sales puncture tyre companies' hope of revival

Falling car sales puncture tyre companies’ hope of revival

May 29, 2024

Coach: Tire makers will be looking to make a financial recovery last quarter as the decline in auto sales is expected to fall due to lower natural and synthetic rubber prices.

Swaranjit, Director, JK Tire Materials “So far, the tire industry has not performed well compared to last year.” The festive season was disappointing. We expect sales to increase in the last quarter due to economic recovery.” “I’m not sure,” he said. “Over the past year, natural rubber prices have been in line with global trends, while synthetic rubber prices have been on a downward trend. Last month, with the fall in crude oil prices, rubber prices became cheaper.

However, the industry could not benefit from the fall in prices of key raw materials due to weak demand for tires. As the post-Lantern Festival boom did not materialize as expected, many automakers introduced discounts to boost sales and some tire makers followed suit. In this scenario, tire makers are now maintaining low inventory levels.

A leading tire maker executive, who asked not to be named, said, “The company’s profitability is good as rubber prices and costs are falling, but low demand is the problem.” Moreover, tires are made from 70% natural rubber and the rest from synthetic rubber.

President, Rubber Industries Association of India “Synthetic rubber prices have fallen by 15% due to fall in butadiene prices. Most of it is imported and the import price is ‘0.110’ per kilogram.” ” He said. Although it is the prices of some varieties of synthetic rubber such as SBR and BR that have come down, the prices of other types of synthetic rubber such as EPDM are still higher.

Synthetic rubber varieties which are not produced in India should be allowed to be imported duty free,” Gupta said.

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