Tyre Makers Mulling Price Hike From 9th September, 2018
Owing to various factors such as the rise in the rate of US dollar, floods in Kerala and shortage of domestic natural rubber, the prices of tyres are set to hike by 9th September 2018.
Industry experts last month indicated that tyre prices are set to soar in the wake of Kerala floods from mid of September 2018. The major tyre makers including Apollo, MRF, TVS, CEAT and others have officially announced that they will raise the prices across certain tyre segments from 9th of the current month. One of the major reasons for this price hike is the fact that there is a considerable decline of approx. 15% in the rubber production due to the flooding in the largest rubber producing state of India. Moreover, tyre industry analysts have also hinted that there will be a shortage of motorcycle and scooter tyres in the coming months as the major tyre companies are more inclined to export of two and three wheeler tyres due to US dollar fluctuation rather than selling their tyres in after replacement Indian market.
Further, the industry experts believe that the impact of Kerala floods will reflect in 2018-19 Q2 results for many companies including big tyre manufacturing companies. However, it is yet to be seen that how long this impact will remain. Also, with the expected increase in domestic and global rubber prices, accompanied by the devaluation of the Indian rupee, tyre manufacturers are likely to witness pressure on their profit margins.