Report
20.03.2017
The Russian tyre market has a paradoxical situation. In recent years, it had lost in sales; also 2016 did not become an exception. At the same time, domestic production of tyres, including on localized enterprises of international corporations, has grown so much that Russia has become a solid exporter.
According to Andrey Pantyukhov, the temporary president of Nokian Tyres concern and the general director of Nokian Tyres Russia, the Russian tyre market in 2016 continued its decline, which began in 2013. As per the company's estimates, the overall secondary market for passenger car tyres without primary configuration decreased by 5 percent and amounted to approximately 31.5 million tyres. The premium and mid-price segments fell by 10 percent, while the consumer segment remained practically at the same level. In general, today the market has been stabilized, and this year we can expect growth in the range of 5 to 10 percent. At the same time, production of passenger car tyres in Russia, according to Nokian Tyres, grew by about 9 percent.
“The main growth drivers were the production localization of international producers and import substitution. The export of passenger car tyres from Russia, which became more profitable due to the devaluation of the rouble, increased by 26 percent”, Andrei Pantyukhov emphasized.
Nadezhda Churmeeva, the executive director of the Tyre Manufacturers Association, informed the “RG” that many large producers chose to start production in Russia as their strategy. Now we have successfully operating production sites of Continental, Michelin, Nokian Tyres, Pirelli and Yokohama brands. At the end of the last year, Bridgestone launched its production. “Undoubtedly, this shows that Russia occupies a serious place in the strategy of international tyre manufacturers. Many companies are actively increasing the export of products manufactured in Russia, which means that more and more tyres of brands well-known abroad are sold with the mark “Made in Russia”, the expert said.
Ilya Alimov, the head of the marketing and retail network development department of “Bridgestone CIS”, stressed that in the medium term, a systematic increase in production will recommence in Russia. Every year experts and key players note the rise in the culture of tyre consumption. There is a trend in which consumers are more responsive to the choice of brand, paying due attention, in addition to price, to the product characteristics and brand reputation. “Despite the continuing sales decline of new cars, the share of premium brands remains high, which speaks for the great potential of the “premium” segment, – Alimov said. – The tyre segment for SUV is developing dynamically, and this trend will probably continue”.
According to Michelin estimate, the 4x4market share is 5.7 million tyres in overall volume. This segment resists the crisis better than the market as a whole, and has shown the steady growth over the past three years, while the overall market has fallen by 18 percent, Dmitry Molokanov, the director of MICHELIN marketing department of passenger car tyres in Russia, told RG.
Nina Kozlova, the general director of the audit and consulting group “FinExpertiza”, stressed that the tyre market was falling at a much slower pace than the sale market of the new cars, because only one-fifth of the production is delivered to the conveyors of car factories. She also drew attention to the fact that in the structure of the cost of tyres about 70 percent is accounted for raw materials. And one of the reasons for localization cravings of foreign companies in Russia is the possibility of using domestic raw materials in production. This provides local products with trump cards in competition with imported products.
However, all enterprises – those, who buy raw materials for the currency, and those who use domestic raw materials – have good reasons for increasing price of the product. One of such reasons is that since 2015, tyre producers and importers are responsible for recycling waste products or payment of the environmental tax amounting to 7.1 thousand roubles per ton.