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All India Tyre Dealers Federation seek reduction in tyre prices |
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CHENNAI: The All India Tyre Dealers' Federation (AITDF) is pleading with the ministry of road transport to take up the cause of road transporters who have been asking for a reduction in tyre prices due to the fall in raw material, just like the government has taken up the cause of the rubber growers in Kerala.
With the continuous steep fall in domestic natural rubber price for more than 6-7 quarters, the chief minister and finance minister of Kerala held a meeting with domestic tyre manufacturers on December 19 and were able to 'convince' the tyre industry to pay Rs 131/kg for natural rubber to growers as against the prevailing market price of Rs 115/kg.
This was done to help the rubber growers of the state as the natural rubber price had fallen to Rs 115/kg from the earlier peak price of Rs 242/kg during year 2009-10.
The Kerala government reminded tyre makers that it helped the domestic tyre industry in getting the import duty on natural rubber reduced from 20% to 7.5% in 2009 when tyre manufacturers wanted the rubber import to be made cheaper.
Coincidentally, on December 18, the Union commerce and industry minister expressed concern, while addressing a function organized by IIFT, about the failing health of Kerala rubber growers due to declining rubber price.
"When the price of natural rubber shot up to Rs 242/kg during year 2009-10 and price of some of other raw materials too moved up during this period, the domestic tyre manufacturers increased the tyre prices steeply for various categories of tyres by 17% - 22% as their hardly exist any serious competition among key tyre majors in the country," said a latest report by the AITDF.
"Now for last 6-7 quarters, the raw material prices including natural and synthetic rubber have plummeted to a five-year low and average weighted drop could be 30%-35% to the benefit of domestic tyre manufacturers. Unfortunately, despite plea to the domestic tyre majors and also to the ministry of commerce and industry, none of the tyre makers has reduced / rolled back the tyre prices in the replacement market."
"While, for rubber growers, the governments have expressed serious concern over their plight due to fall in rubber price, but strangely, when it comes to the mass of tyre trade and millions of road transporters, even the lip service is missing, what to talk of intervening to 'convince' the domestic tyre manufacturers to cut back the tyre prices," said the report.
"The tyre trade has always maintained equidistance from tyre makers and consumers and has also always maintained that it is the prerogative of individual tyre maker to fix the price of its products in line with increase in price of various inputs which go into the manufacture of tyres," said SP Singh, convener, AITDF.
Source : timesofindia.indiatimes.com
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