Leader Tread ready for growth
Some 2.3 million truck tyres are currently sold in South Africa each year, with the market fairly evenly divided between sales of new tyres and retreads. Competing in the retread market are numerous familiar global names such as Bridgestone Bandag, Michelin and Goodyear Dunlop, yet one of the longest established retreading sector firms is local player Leader Tread. The Johannesburg-based company has been in the business for almost half a century and in recent times awareness of its products has also increased outside of Africa. In February, Tyres & Accessories spoke to Leader Tread managing director Brett Sproson and gained an insight into a company that is active and growing in all areas of the retreading and retreading materials market.
Outlining the core Leader Tread range of pre-cure treads, Sproson says the company caters for all market segments with a portfolio it describes as comprehensive. Currently, the main brands Leader Tread supplies are its standard, premium PLUS and OTR lines. The managing director comments that “we are continuously developing our products to stay in step with an ever changing market,” and this timely adaption to market trends can be seen in a soon to be released addition to the Leader Tread pre-cure tread family, the ECO TREAD range. The new treads are scheduled for introduction this year and Sproson says ECO TREAD will deliver “excellent savings in operational related costs, including cost per kilometre.” When asked about the new product’s potential customer base, he shares that Leader Tread believes substantial migration will take place from the company’s standard and PLUS products to the new ‘green’ range.
In addition to export sales, the (soon to be) three truck tyre tread ranges are sold in a domestic market that, as previously mentioned, stands at around 2.3 million tyres per annum in total. While Leader Tread is unable to give figures on its own share of this market, Sproson says the company estimates the overall retread to new tyre ratio within South Africa to be 1.04 retread units for each new tyre sold. This figure is approximately the same as the ratio in Europe, and given premium tyres’ suitability for multiple retreading shows equal room for improvement. The Leader Tread managing director is however confident the ratio will continue to shift in favour of retreads. “We see improvements in the retreadability of casings coming from Asia,” he notes. “Therefore this number should improve.”
Leader Tread is part of the Leader Rubber Company, and although the manufacture of tread rubber for commercial and earthmover applications is its core business, Leader Rubber also offers an assortment of products such as bonding gum and a wide variety of retreading consumables, including items produced by well-known European manufacturers; the retreading specialist’s latest catalogue includes a broad range of patches, buffing tools, grinders, solvents and numerous other items.
The products Leader Tread sells at home are backed up by training for those who use them. Last year the company named Retyre its first accredited dealer, and several more have already followed suit. “Quality control and safety is of critical importance at each and every one of our dealer factories,” states Sproson. “Leader Tread’s accreditation programme is developed to provide our dealers with guidelines and skills to monitor and improve the quality of their products, cost of production and safety in the work environment. We have added a further six more dealers to the programme and are working towards getting all our dealers certified.”
In addition to the production of pre-cure treads and the training of pre-cure retreaders, the South African firm participates in the marketing and development of the Marangoni Ringtread system. Leader Tread has worked with the Italian retreading company since 2005, when it secured the South African agency for the Ringtread system. The first machine for producing these spliceless retreads arrive at the end of that year along with a Marangoni ITT Cubo 2500 unit capable of conducting bead-to-bead inspections. Last year this relationship with Marangoni was consolidated by the establishment of a cooperation agreement. Brett Sproson shares that as part of its investment in the Ringtread system, Leader has added CNC buffers, Ringtread builders and a new shearography machine, and the South African Ringtread production base is growing. “We are currently supplying five Ringtread plants in South Africa and we are quite far down the road in negotiations for an additional one later this year. We have a dedicated team to supply training and equipment maintenance, and have full, prompt and professional support from Italy.”
While the managing director didn’t comment as to whether the growing popularity of Ringtread may occur in part at the expense of pre-cure market share, he points out that the Marangoni system provides a “very unique premium product with excellent characteristics” – a product that “definitely has a place” in the South African market. Ringtread is managed and operated as a separate business unit to Leader’s pre-cure activities, he adds.
For many in the South African retreading business, 2011 was a hard year. Sproson shares that the economic climate last year caused the retreading market to become very price sensitive, an occurrence that didn’t help the rollout of a premium product such as Ringtread. Other challenges the country’s retreading sector faced would have a familiar ring to retreaders in other parts of the world: “The retreading industry in South Africa saw abnormal raw material price increases during 2011. Along with the unfavourable economic climate it has been a tough year. Having said this, we are happy to report growth in 2011.” As for the coming year, Leader Tread’s confidence despite market challenges can be seen in the company’s capital investment plans; its investments include an additional five deck 11 metre press, a 240 litre mixing unit and a new tread buffing line.