India Now 3rd Largest Market for Budget Chinese Tyres
Data released by India’s Automotive Tyre Manufacturers Association (ATMA) adds weight to complaints from Indian tyre manufacturers about the quantities of budget tyres arriving from China. According to the ATMA, since 2002-03 India has jumped from being the 39th largest market for Chinese tyres to being the third, and the organisation predicts it will slip into top place in the near future.
India’s Business Standard newspaper reports that during April-February 2008 Indian imports from China, at 1.2 million units, had almost doubled compared with the same period a year earlier. Chinese tyres hold a 15 per cent of the RS 78 billion (£927 million) replacement tyre market for trucks.
Koshy Varghese, MRF vice president, marketing, said: “About 15 per cent share of the after market, which could have been ours, has gone to the Chinese players. The imported tyres are allowed in the country freely and are sold at 30 per cent less than local tyre prices. The Indian buyer is attracted to Chinese tyres purely because of the pricing and not for technology. We cannot reduce our prices because of spiralling input prices.”
An industry expert claimed that even though prices of Indian tyres cannot be lowered, the technology and quality of domestic tyre products are better than the Chinese tyres. “Even though the consumer is aware about quality issues of Chinese tyres, there will always be a demand for such tyres because of cost advantage.”
In a presentation made by ATMA Chairman Raghupati Singhania, who is also the chairman of India’s third largest tyre maker, JK Tyres, to the commerce ministry in May, the body pointed out that despite filing two petition against the import of Chinese tyres, little has been done so far.
The body has thus asked for anti-dumping investigations and the imposition of duties on China for import of radial tyres. India had imposed a similar anti-dumping duty on bias ply tyres in June 2007.
Rajiv Bhudhraja, director general, ATMA, said: “The average price of a pair of Chinese truck tyre is about Rs 7,500, which is significantly lower than Indian prices which retail at about Rs 13,000-15,000. More than 100,000 Chinese tyres are imported every month, totaling to about Rs 900 crore yearly (Rs 9 billion). More alarming is the fact that people have changed their perspective about products from China, which was once thought to be sub-standard.”