At a time when climate change is taking an increasingly higher place on the agenda, retreads are coming more and more to the forefront of discussions, both at business and political levels. This topic was dealt with recently by BRV Managing Director Hans-Jürgen Drechsler in an interview carried out in the German tyre trade magazine Gummibereifung.
Prospects Good for German Retreaders
In a discussion with editor Olaf Tewes, Drechsler expressed the opinion that retreads can look forward with optimism to a potential renaissance based on growth experienced in the market during both 2018 and 2019.
According to Drechsler, sell out figures of truck retreads in first six months of 2019 have been very good, showing an index of 102.1 in comparison with the previous year. This, he said, compares favourably with the performance of new tyres, whose index was only 96.5. Drechsler expressed the opinion that the positive trend will continue during the rest of the year bearing in mind the fact that the period from September to November traditionally makes up 35% of annual sales.
Drechsler agreed that there had been a noticeable consolidation in the European retread market due to the recently introduced antidumping regulation. This he said has resulted in the European retread market growing from 4.167 million units in 2017 to 4.342 million in 2018 – i.e. 4.2% growth.
“Indeed, in Germany the change was noticeable already in 2017 where the reduction in the market began to stabilise,” said Drechsler. “In 2017-18 the German market grew 1.3% to 806,000 units.
On the question of whether retreads will be completely elevated to promotional support status in the 2020 De-Minimis regulation, Drechsler pointed out that he was not able to confirm one way or the other.
“We have submitted a comprehensive and detailed application to the Federal Ministry of Transport and Digital Infrastructure for the 2020 funding period to increase the eligible expenditures for retreaded tyres from the funding period 2020 to at least 80 percent.
“We will fight for this,” he added, but expectations should not be overstated as the promotion of retreaded truck tyres as environmental products would represent an exception to the promotional support rules, in so far as only supra-mandatory products (ie those which exceed legal standards) are usually promoted. In addition to this, such a decision would dependent on a comprehensive ministerial coordination among the various ministries.”
Despite this, Drechsler felt that the current focus on climate change had the potential to give positive momentum to the retreading industry. “We have begun discussions with the Environment, Economy and Transport Ministries with particular reference to a study entitled The Socio-Economic Influence of Retreaded Truck Tyres in Europe: Circular Economy Related to Tyres in Danger. We will continue this campaign, also internationally through BIPAVER.”