China's Tire Import Tide Causes Indian Panic

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China Drying Network News a large number of low-cost Chinese imports of tires continue to flood the Indian market, coupled with slowing domestic demand, causing concern in the Indian automotive industry.

Attracted by lower prices, the taxi sector is increasingly inclined to use imported tires, although it is reported that the quality of imported tires is inferior to local tires. The current tax on tire imports is 10%. The industry has been requesting the government to increase the import tariff on tires, and the tariff on natural rubber has remained at 20%. The devaluation of the rupee has not had a significant impact on tyre imports.

Imports of tires for trucks and buses fell by 7.6% in the first quarter, and imports of car tires rose to 1.4 million, which was basically a 24% increase from the first quarter. This is a significant increase. In December 2011 alone, the import of passenger car tires rose by 2.4% to 4.875 million.

Last year, the import of tires for trucks and buses dropped by 10.3% to 1.645 million. Vikram Malhotra, vice president of marketing at JK Tire, said: "The availability of cheap tires in China is a matter that requires our close attention. Not to mention the current taxi drivers have changed the commonly used brands. In some models China’s automobile tires already account for nearly 20% of the market.”

The field of radial tires has also been affected. The price difference between radial tires for trucks and passenger cars is as high as 20%, while the price difference for radial tires for passenger cars has also reached 30% to 35%. Almost 60% of tires come from China.

“Although the import tax on tires is 10%, because of the agreement in the Asia Pacific region, the import tax on China is 8.6%. The main importer is an independent trader. Earlier, the original equipment manufacturers also needed to import. "The head of the Auto Tire Manufacturers Association, Rajiv Budhraja said.

"The United States, Europe and Brazil have implemented economic obstacles to reduce imports. But here, China's anti-dumping of low-quality tires has caused serious safety problems," said Athari Shamal, executive chairman of Apollo Tire India. Say.

Interestingly, this situation occurs when the import duties on natural rubber and latex have reached 20% and 70%, respectively.

The industry insists that this is a high raw material tax and a lower product tax liability.

“Even after the rupee’s depreciation, buyers and sellers have renegotiated prices, and tire imports have not been affected much,” said Vinod Simon, president of the All India Rubber Industry Association.

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