Global Recession Costs UK Tyre Manufacturers and Distributors £299 million

The recession has cost the UK tyre manufacturers and distributors £299 million in lost profit during the last year, according to new research by Plimsoll Publishing. David Pattison, senior analyst and author of the Plimsoll Analysis – Tyre Manufacturers & Distributors, commented: “The recession has hit the sector hard with more than half of the companies analysed in our new report making less profit than they were a year before. The bill in lost profits stands at £299 million”.

When pressed for a reason for this collapse in the bottom line of companies throughout the market, Pattison suggested: “With demand so subdued and the resultant competition, many companies are unable to charge the price they need to make healthy profit margins. In the absence of pricing power many companies will have to make painful but necessary cutbacks in the next 12 month”.

However, the burden of lost profit is apparently not being shared equally: “118 companies have bore the brunt of the downturn. These companies have seen their profit margins decimated and in the absence of a big upturn in demand will have to cut their cloth accordingly. Watch out for further job losses and closures as these companies as they look to claw themselves back to profit next year. If they fail to act quickly they could find themselves running out of cash”.

In a none-to-subtle plug for the report, Tyres & Accessories/tyrepress.com readers can claim a £50 discount off this new special edition of the Plimsoll Industry Analysis – Tyre Manufacturers & Distributors by quoting reference PR/TI76.