The Russian tire market in the first quarter decreased by 8.5% to 11 million units
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The Russian tire market in the first quarter decreased by 8.5% to 11 million units. The main part is still accounted for by passenger tires, while the share of their retail sales is growing. Despite the large fleet of cars and the high capacity of the secondary market, the last tire change season passed with decreasing prices – this is noted by both the marking system operator and marketplaces. But prices still will not fall to pre-crisis levels, market participants are sure.
The market for tires of all categories in the first quarter decreased by 8.5%, to 11 million units, follows from the review of the CRPT (operator of the Chestny Znak labeling system), created jointly with the National Scientific Competence Center in the field of combating illegal circulation of industrial products (NSCC) . The segment of passenger tires traditionally accounted for the bulk of sales (7.7 million units), and in retail sales of rubber for passenger cars even slightly increased at the beginning of the year – by 7.5%, to 3.5 million units.
In total, 18.2 million tires entered the market in January-March, which is 14.2% less than a year earlier, of which 8.9 million units (48.8%) are local production.
The volume of imports decreased by 12.8% to 8.2 million tires. It should be noted that at the end of February – March 2022, Russian factories of foreign tire manufacturers began to suspend production or reduce it, and so far not a single enterprise has reached pre-crisis output levels.
Average prices decreased in all segments compared to the first quarter of last year, with the exception of construction, mining and industrial tires, where, on the contrary, they increased by 2.6%, to almost 19.6 thousand rubles. In the passenger segment, the average price in January-March 2023 amounted to 5.6 thousand rubles, which is 19.8% less than a year earlier and 4.4% lower than in the fourth quarter of 2022. Moreover, prices for summer tires also fell (by 14% and 25.3%, respectively, to 5.3 thousand rubles).
The CRPT and NNCC report notes that the volumes of price segments are generally stable: tires of the lower price category occupy about 50% of the market, the average price category – 25%, and above average – 25%.
However, they add that the share of sales in the premium segment (worth more than 9 thousand rubles) is “very small”, “which cannot be said about winter tires, in which the premium segment, although it does not occupy the main part, is represented quite voluminously” . Since the beginning of the crisis, foreign players have been talking about a drop in demand in the premium segment, but now it is also declining supply against the backdrop of the withdrawal of Western manufacturers from the Russian Federation.
The main import of tires, according to the CRPT, came from China, followed by Korea. Aleksey Golovin, head of Avito’s New Spare Parts and Car Services business development, notes that new tire brands have entered the market and are ready to offer budget options: “Thus, the Chinese brand Triangle was the most popular among new summer tires this spring. It accounts for 11% of sales at Avito, on average, a set costs 51.2 thousand rubles. The share of requests for this brand from China is comparable to Pirelli (70 thousand rubles per set), it accounts for 10% of all tire sales, he said.
The most noticeable increase in supply was shown by new tires from the South Korean concern Kumho – by 5.1 times year-on-year, Mr. Golovin notes, and they chose it 2.2 times more often than in 2022.
The average cost of a new set of four tires at Avito was 68.5 thousand rubles, used summer tires will cost almost 21 thousand rubles.
Droma recorded a drop in the average cost of new tires not only in the first quarter: in March-May, when tires are changed, the price fell by 9%. “The decrease in the cost of new tires is a consequence of the events of February-March last year, when tires rose sharply in price, and models of individual brands grew by 71%,” says Droma product manager Vladimir Pitin. “Double price increases were demonstrated by both Russian and imported tires. Demand has increased strongly: buyers swept tires from virtual shelves. Today the situation has stabilized: the prices for new tires have slightly decreased, but have not returned to pre-February levels.” In the long term, the company expects stable growth in tire prices.
Sergey Udalov from Avtostat notes that large stocks remain on the market now, and demand was largely satisfied during the hype in 2022. He believes that as inventories run out, as well as due to inflation, prices will go up.
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