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Retreading, an opportunity to be seized

Massimo Condolo

Retreaded tires business offers many economical and environmental opportunities, but low cost tires gives it more than a pressing concern
Nowadays scenario sees the low cost tires offer eating away market shares to retreading business, making this industry face new and crucial opportunities. Stefano Carloni, Airp (Italian association of retreaders), highlighted how in the last twenty years the number of active companies went down from 300 to 40.

Thanks to the circular economy, in which retreading can be pointed out as one of most classical best practices (it makes save raw materials by 70%, CO2 emissions by something from 24 to 37% and costs by 40%), retreading has still market room, if its mentality and technology can evolve. Franco D’Amore, Energy Area – Institute for Competitivity director, explains: “as a recent survey by AIRP statued, in addition to what we said, retreading can make us saving 29% of land, 19% of water, and to preserve economical value of materials by 70%”. That’s what emerged from the “The futuring of retreading” conference. Experts and player in the sector participated. Retreading ranks today in a growing tire market, but few room for it is still very few. Chinese tires does not only fight on prices: they know very few about retreading, a technology that is not widespread in their domestic market. In Europe only two of the four big markets record an increase of more than 5%, while Germany is still and UK decreases sensitively. “North American and European markets”, says David Shaw, Tyre Industry Research CEO, “are recording a decrease in sales volumes, that is pushing big retreading brands to scout for new customers also among smaller fleets”.

Dirk Reurslag from VMI Technologies goes on: “Two big problems remain: quality and quantity of the cases to be retreaded and finding skilled and trained workers”. Marketing is another sticking point: “We have five years, the time anti-dumping laws will last, to prepare campaigns and services that will make people appreciate environmental, technical and economical features of retreaded tires”, ends Sadro Garcia Salmones from Valebridge Media Services. Chinese new single-life tires ate out a big market share to retreaded tires, particularly in the big fleet business. Chinese industry expansion reached via acquisitions and merging some eastern and western production areas, such as Serbia, United States, Thaliand and Vietnam. This is another aspect from the same phenomenon, involving Chinese products coming from countries not subjected to anti-dumping laws.In Europe 71retreading industries went out of business between 2014 and 2017: it means that strong changes in mentality is required to revered the trend. “We have to fight against competition from low technology products with top level technologies”, says Hajeeve Kandahari from Vacuuìlug Technology Ltd. His company, that retreads only truck and OTR tires, uses for its products aerospace technologies providing an optimal cost/quality/performance ratio.

“Price is not the only driver in customer decisions: the total cost of ownership of the chosen solution is paramount”. New technologies encourage transition: being able to trace and geolocate a tire without big investments but simply using TPMS system and on-board electronic network of the lorry makes scalable for small and even mono-vehicular fleets some apps that up to yesterday were exclusive to big ones. “Another effect of the competiton from China is the growth for non-premium brands, Tier 2 in particular. In Italy and Germany also Tier 3 brands are growing significantly, while on French and Italian market also retreading business is are increasing slightly ”, says Ivano Garavaglia from Gfk Growth For Knowledge.

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