Import glut ripples across European truck tyre market

The ups and downs of European retreading continued last year. According to current figures from the European Tire & Rubber Manufacturers’ Association (ETRMA), association members retreaded and marketed a total of 4.298 million truck tyres in Europe (excluding Turkey) in 2022. This corresponds to a decline of at least 6.2 per cent compared to the previous year, but is still 4.9 per cent above the figures for the previous year. However, since ETRMA members’ new tyre was largely stable (down 0.5 per cent), the importance of retreaded truck tyres fell significantly compared to the new tyre market and was only 37.2 per cent at the end of last year. The association’s figures also show something else very clearly: the EU tariff effect, which had reduced imports of truck tyres (by non-ETRMA members) for a number of years, has now completely fizzled out.

We’ve been publishing the current ETRMA figures on the European truck tyre market since 2007. While the ETRMA figures don’t cover 100 per cent of the market, they do give a good overview of what is happening in local markets. And that is apparently again heavily influenced by imports from non-ETRMA suppliers.

When imports of new truck tyres – usually from the Far East, namely China – swelled in the early 1900s, the EU significantly increased the market access costs for importers with the anti-dumping and anti-subsidy tariffs then introduced in 2018. From 2017 to 2018, imports of truck tyres plummeted by 1.1 million, or 21.4 per cent. But this effect was short-lived. After a three-year low with imports in the range of 3.7 to 3.8 million truck tyres and a share of a good fifth of the total market reported by ETRMA, imports rose again significantly in 2021.

Why? The consensus amongst market participants is that many producers from China set up new production bases outside China in the years of the trough, thus avoiding the disadvantage of increased tariffs for market entry costs. However, the really big leap in import figures only took place last year.

As ETRMA figures show, 5.59 million new truck tyres were exported to and sold in Europe in 2022, compared to ‘only’ 4.46 million tyres the year before, already the third-highest value in our statistics. Until then, that level had only been surpassed by the two years directly before the introduction of EU tariffs. Last year, new truck tyres that were not produced and sold by the ETRMA members in Europe or that they imported themselves accounted for a 26.1 per cent share of the total market. Before the so-called “China glut” began, the import share was usually 10 per cent or less.

Less dramatic, although the trend is just as clear, is the continued and steady decline in retreaded truck tyres. While in the peak year of 2012 there were 60 retreaded truck tyres for every 100 (ETRMA) new tyres, last year there were only 37. The following figures also offer an exciting perspective on the changes in the market: For every 100 new truck tyres, brought into Europe by non-ETRMA members and marketed here, 360 retreaded truck tyres came in. Last year, that number was just 77. Only the two years before the introduction of tariffs (2016 and 2017) were similar.

In other words, the proverbial “China glut” has now become an “Asia glut”, whereby the wave resembles a tsunami.