Thursday, 29 April 2021 10:11

Sri Lanka tyre market suffers a shortage Featured

The Sri Lanka market for tyres, Passenger Car Radials or PCR in particular, has witnessed a shortage over the last two years due to heavy dependence on imports market sources revealed.

 

With the import restrictions imposed in 2020, this segment has suffered heavily, as it faces an annual demand of approximately one million which local production cannot entirely meet.

For example, the country’s largest player CEAT manufactures approximately 500,000 units per year, leaving the market with no other choice than alternatives. The most viable option would be to source tyres from other local manufacturers whose intended market is the export market.

However, regulatory, and other restrictions prove to be formidable obstacles. For example, tyres manufactured for export utilise raw materials that were imported tax-free, as a concession afforded to incentivise local industries.

This provides a competitive advantage to BOI-affiliated enterprises, over those who focus on the local market. If such a pricing mechanism could be formulated where neither party is disadvantaged, and ultimate benefits offered to the consumer, the tyre shortage can be mitigated effectively in the short term until the import restrictions inevitably relax.

This crisis has not escaped social media where all corners are airing their grievances and anxieties. Ludicrous social media posts abound, including one where truckers fill their tyres with hay (piduru) to minimise wear and tear were met with much ‘laughing’ and ‘haha’ emoticons on the posts.

Second-hand tyres once shunned are now being readily advertised on dedicated Facebook groups for buying and selling pre-owned items. Hilarious comments including tongue-in-cheek ones such as suggesting whether the Government will ask citizens to ‘DIY’ tyres for their cars much in the same vein as turmeric and coconut oil.

 

 

 

 

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