Tyre production in India declined in the first two quarters of this fiscal with products in all categories, except passenger cars, witnessing decline in output, according to Automotive Tyre Manufacturers Association (ATMA).
As per the latest data released by ATMA, passenger car tyres production increased by 7 per cent in the April- September period this fiscal at 189.80 lakh units as against 177.11 lakh units in the year-ago period.
The second largest segment, medium and heavy commercial vehicles (M&HCV) tyres witnessed a decline of 2 per cent at 83.87 lakh units in the period under review, as against 85.48 lakh units in the April-September period last fiscal.
Commenting on the trend, ATMA Chairman Raghupati Singhania said: “Notwithstanding resurgence in production and sales of M&HCVs during the current fiscal, the domestic production of M&HCV tyres is down.”
In view of the fact that M&HCV segment accounts for 55 per cent of the tyre industry revenues, the de-growth in heavy commercial vehicle tyre segment has hit the industry hard, he added.
Elaborating further, Singhania said the the drop in production is being witnessed at a time as the investments lined up by the industry to the tune of Rs 35,000 crore in the last few years is reaching its fruition.
“While production is down the manufacturing capacities are lying unutilised. A significant part of demand especially for truck and bus tyres is being met by cheaper imports from China. Capacity utilisation levels have touched new lows,” he added.
As per the ATMA data, light commercial vehicles (LCV) tyre production fell 14 per cent at 47.88 lakh units as compared with 55.75 lakh units in the year-ago period.
Tractor front tyres saw a drop of 9 per cent at 14.09 lakh units in the April-September period as against 15.41 lakh units in the same period last fiscal.
Tractor rear tyres production fell by 11 per cent at 10.81 lakh units as against 12.09 lakh units.
ATMA said tyre exports have also seen contraction during the period across key categories. Exports of M&HCV tyres were down by 9 per cent at 9,68,061 units as against 10,63,938 units in the same period last fiscal.
Passenger car tyres have seen a much sharper drop of 22 per cent at 10,81,841 units as against 13,95,921 units exported in April-September period last fiscal.
“The growth environment in case of tyres is vitiated in view of no-holds barred import of cheaper tyres. Truck & Bus radials is among the fastest growing categories in the tyre industry. However imports have come to account for more than 30 per cent of the replacement market impacting domestic production,” Singhania said.