Prices up, sales down: Egypt's tire market hit by foreign currency woes

Published August 30th, 2016 - 09:30 GMT
Egypt's tire sales have not recovered despite a traditional uptick in purchases over the summer. (Pixabay)
Egypt's tire sales have not recovered despite a traditional uptick in purchases over the summer. (Pixabay)

The prices of car tyres and rims in Egypt increased over the past five months as a result of the successive increase in the US dollar exchange rate.

The market has witnessed a recession period and a decline in the sales of merchants and agencies by nearly 65% compared to the same period last year, which witnessed a recovery period during the summer.

Hussien Mahmoud, sales manager at El Mostafa Wheels and Tires, said that the increase in the price of the US dollar in the past five months increased wheel and tyre prices, obstructed selling and buying traffic, and caused a market recession.

Lassa tyres, made in Turkey, and Maxxis tyres, the most popular in the Egyptian market, witnessed increased prices, with 175/70 R13 tyres registering EGP 370 compared to EGP 270 five months prior. The price of 185/65 R14 tyres reached EGP 490, up from EGP 390. The price of 195/70 R14 tyres reached EGP 515 compared to EGP 420 five months prior.

The prices of Kenda tyres—an American-Canadian manufacturer—also increased. The price of 185/65 R14 tyres registered EGP 500 from EGP 410. He pointed out that the decline in the company’s sales in the Egyptian market is due to high prices and high production costs. The company has had to offer tyres of the same brand, but made in Turkey at lower costs, in an attempt to stimulate sales in Egypt.

Mahmoud said that the Chinese manufactured tyres of Kenda registered EGP 300 for 175/70 R13 tyres, EGP 340 for 185/65 R14 tyres, and EGP 390 for 195/65 R14 tyres.

The source said that the increase in the US dollar price in the mentioned period led to an increase in the price of the Indonesian tyre Achilles. The price of Achilles 175/70 R13 tyres registered EGP 340 compared to EGP 260 prior, while 185/65 R14 tyres registered EGP 490, up from EGP 370.

Prices of the German brand Continental also increased, with 175/70 R13 tyres registering EGP 420 compared to EGP 330. The price of 185/65 R14 tyres increased to EGP 610 from EGP 430 previously, and the price of 205/55 R16 tyres registered EGP 750 instead of EGP 525—an increase of EGP 225 over five months.

Tyre prices for the Korean brand Hankook also increased to register EGP 400 from the previous EGP 300 for 175/70 R13 tyres. The price of 195/70 R14 tyres registered EGP 525 compared to EGP 420. Hankook 185/70 R14 tyres registered EGP 490, up from EGP 380.

The Turkish manufacturer tyres of Hankook, Pirelli, witnessed 175/70 R13 tyres increase in price from EGP 300 to EGP 390, and the 185/65 R14 tyres from EGP 450 to EGP 525. The195/70 R14 tyres increase from EGP 430 five months ago to EGP 570.

The price of tyres by the Korean-Vietnamese brand Kumho increased as well. The price of 175/70 R13 tyres registered EGP 340 compared to EGP 250, and the price of the 185/65 R14 tyres increased to EGP 445 compared to EGP 350.

The 195/70 R14 tyre price registered EGP 460 instead of EGP 340 before the increase. The 205/45 R16 tyre price increased to EGP 625 from EGP 420, while the tyre price for 205/55 R16 tyres reached EGP 640 instead of EGP 500.

Mohamed Al Saidi, sales manager at Al Saidi for Tyre and Wheels Trade, said that tyre and wheel prices increased since the beginning of this year, due to the high dollar exchange prices, which led to a significant decline in sales, despite the recovery of the buying and selling traffic during the summer every year. However, 2016 has broken this rule affected by the prices increase.

He explained that Pirelli—which exports tyres that are made in Germany by German materials—is affected by the price increase in the last period. The brand’s 195/65 R15 tyre price increased to EGP 725 instead of EGP 530, the 205/55 R16 tyres registered EGP 835 instead of EGP 590, and the 215/45 R17 tyres registered EGP 890 instead of EGP 700.

He added that the Indonesian G.T prices increased to register EGP 350 instead of EGP 270 for 175/70 R13 tyres, while 185/70 R13 tyres increased in price to reach EGP 425 instead of EGP 320. The 185/60 R13 tyre price registered EGP 400 instead of EGP 320, while the 195/60 R15 tyres registered EGP 500 instead of EGP 380.

Al Saidi said that they offered new brands of tyres in the market at low prices to combat the current high prices of the other brands to suit the consumers’ needs and to encourage them to purchase these tyres when they need to—especially since the high temperature in the summer damages the tyres.

He explained that the Polish brands Safa and Deepika are the new brands, with prices registering EGP 300 for 175/70 R13 tyres and EGP 390 for 185/65 R14 tyres.

The source added that Safa and Deepica offer French made types but in bigger sizes. The 195/55 R15 tyres are sold for EGP 525, while the 205/55 R16 tyres are sold for EGP 590. He emphasised that these tyres are experiencing high demand and are the best selling due to their good quality and low prices compared to the other brands.

Mohammad Nader, chairperson of Al Kabeer Trading Company, said that the prices of wheels increased by an average of EGP 400 per set, which led to a decline in sales and spread of recession.

He explained that the prices of the Chinese rim size 13 increased to EGP 1,200 compared to EGP 1,050 before the increase. The Turkish and Indonesian rim size 13 also increased to EGP 1,400 from EGP 1,200.

The price of the Chinese rim size 14 increased to EGP 1,450 compared to EGP 1,300.

The price of the Turkish rim of the same size registered EGP 1,800 instead of 1,400, while the Taiwanese and Indonesian rim size 14 registered 1,800 rather than EGP 1,450.

The prices of Chinese rims sizes 15,16, and 17 increased by EGP 400 to EGP 2,300, EGP 3,200, and EGP 4,000, respectively. The Turkish brand prices for the same sizes increased as well by EGP 400, to register EGP 2,500, EGP 3,500, and EGP 4,500, respectively.

 

© 2019 Daily News Egypt.

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