Titan International: Strong 2022 results, India concerns

Titan International, Inc. has reported record turnover and profitability during the 2022 financial year. While the US-based manufacturer of OTR tyres and wheels increased its net sales by 21.9 per cent to US$2.2 billion (£1.8 billion), income from operations jumped by more than 141 per cent to $205.8 million (£171.5 million), almost doubling the return on sales to 9.5 per cent.

The earthmover and construction tyre business contributed particularly strongly to this result, with a margin of 16.8 per cent at the end of the financial year, compared to exactly four per cent in 2021. In its Annual Report for 2022, Titan International explains that strong performance in the segment was “primarily driven by the impact of net sales” and the “continued improved production efficiencies stemming from the strong management actions taken to improve profitability for the long-term.”

Letter to Biden – Titan’s reply to BKT plans?

In spite of these strong figures, Titan International believes it “faces intense competition” from producers at home and abroad. Its Annual Report reminds readers of a 2016 petition to the US Department of Commerce and International Trade Commission that alleged US market dumping of a range of products including “imported off-the-road (OTR) tyres from India.” The threat is apparently still there: OTR tyres from India are no longer just accused of being sold at uncompetitive prices, now they also contain low-priced but sanctioned Russian raw materials.

In a letter to US President Joe Biden, Titan International and the United Steelworkers union claim that in addition to defending existing anti-dumping and countervailing duty orders on OTR tyres from India, in the last year they have “faced a new threat from Indian producers” – their ability to “leverage access to cheap, sanctioned Russian petroleum products.” They allege this enables manufacturers in India to “drive down tyre prices and propel injurious exports to the United States.”

Of the six tyre manufacturers that Titan International’s Annual Report names as “significant competitors in the off-highway tyre market,” two have a manufacturing footprint entirely in India. These are Alliance Tire Company (part of Yokohama Off-Highway Tires) and Balkrishna Industries, or BKT. Titan and the USW don’t name these (or any) firms in their letter to President Biden, but in light of BKT’s recent announcement of ambitious growth plans, it’d come as no surprise if Titan wished to further restrict their tyres’ access to the US market.