Home > Automobiles, Tyre, Uncategorized > Rubber price stretches further.. tyre prices to zoom

Rubber price stretches further.. tyre prices to zoom

Natural rubber prices surged to a 20 week high of Rs 170 per kg at the start of May 2010. This was in line with expectations. In my previous article (Consumers of automotive vehicles…..get ready to shell out more), I had mentioned that natural rubber prices are expected to remain firm in the near future which would adversely impact its user industries like tyre manufacturing. If the price of natural rubber keeps rising, I wouldn’t be surprised to see another round of tyre price increase (third time in 2010).

This indeed is happening. To partially offset the recent surge in prices, tyre producers have announced a rise in tyre prices for the third time in 2010. They had increased prices by 2-4% in April and 3-5% in January, this year. Apollo Tyres said it will increase prices by 4% across segments in June.

A rise in tyre prices will have a bearing on the costs of the automobile manufacturers. However, due to growing demand for auto-mobiles — even in April and in spite of a hike in vehicle prices — this may not affect vehicle sales. The double-digit growth in automobile sales is expected to continue in 2010-11.

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