The hike in the cost of raw materials to manufacture tyres between September 2007 and April 2008 has compelled tyre makers to hike prices in the range of 7% to 10% during the period. JK Tyres, India’s second largest tyre company, launched "Truck Dhina – Dhin Utsav" last month, which will continue till July 19.
Tyremakers had blamed rising input costs for the price hike. In April, Ceat and JK Tyre had raised prices by 5%, and MRF by 2%.
Major tyremakers are planning to raise prices again in the range of 2% to 5%. Prices of imported tyres have risen marginally, while that of domestic tyres has risen by 25% to 32%, according to the circular from AITDF
With an initial budget of Rs 3 crore, the scheme is a lucky draw that picks out 20 truckers randomly from a group of 200 in a selected region. The lucky trucker get a Rs 500 discount on each tyre he buys.
"Through this utsav, we get to understand more than 70,000 truck and bus owners spread across 82 locations in the country," said JK Tyres Marketing Director AS Mehta.
The utsav’s final draw has prizes ranging from motorcycles to refrigerators, a Tata heavy vehicle to a free Mahindra tempo vehicle and even a Tata Ace. The company says the response from truckers has been so far good.
Apollo Tyres had already launched its "Own Today, Pay Later" installment plan on Feb. 1. According to the company, the plan offers interest rates that are one-fourth the rate charged by retailers for delivery of truck tyres on an installment plan. The average rate charged by a tyre retailer ranges between 2% and 2.5% for 30 days.
"We intend to keep this plan for a long time to come. Since this scheme is relatively new, it would be difficult to comment on the figures in terms of value and units sold. The plan has been well received and we expect them to contribute to the topline," said Satish Sharma, chief-India operations, Apollo Tyres.
However, other companies are pushing the sales of radial tyres as a strategy to combat the price hike. They argue that the truckers can compensate for the hike by buying radials
While more than half the passenger cars in the country are run on radial tyres, only 2% of the heavy commerical vehicles are fitted with them.
Many truckers are still in the dark about the proven benefits of radial tyres such as better riding experience and superior fuel efficiency. Which is why truck majors like JK Tyres and Ceat Tyres have invested in setting up training teams to educate truckers on the proper usage of radial tyres.
"We have 50-member customer team and an exclusive 25-member educators in the radial team across the country. They conduct regular audits on truckers and impart corrective measures in using radial tyres. Key practices such as wheel balancing, vehicle maintenance, maintaining the right inflation pressure in the tyre are shared regularly," said Arnab Banerjee, vice-president, sales and marketing, CEAT Tyres. (Tire Review/Akron)
