HARROGATE, England-Cost increases on raw materials are threatening the success of the passenger retreading industry in Europe, United Kingdom retreaders say. The root cause of the problem, they contend, is the public perception that any new tire is better than a retread.
In the trucking industry, where retreading quality and value are better appreciated, buyers are less price sensitive.
But with passenger sizes, maintaining the price differential between a retread and a cheap new tire is crucial, they stress.
David Rowlands of Motorway Remoulds Ltd. said the retreader's only hope is that manufacturers of the cheap import brands also are suffering from increased raw material prices.
Unfortunately, he said, because the largest increases to date have been on the materials used in tread compounds, the price differential between retreads and budget new tires continues to be eroded.
Gary Oliver, sales director of Colway Tyres Ltd., said materials represent 30 percent of the cost of a passenger retread.
He said his firm hopes to circumvent the pricing problem by exiting the competitive 80- series sector in favor of the more-profitable 65- and 70- series sizes.
Neither retreader could predict what effect retread price increases would have on sales.