02/09/2010: Be warned – car tyres prices are on the increase!

Despite the recent recession, it looks as if car tyres prices increases are lurking just around the corner and indeed the NTDA (National Tyre Distributors Association) has warned that ‘substantial’ price rises may be imminent. So if you’re thinking of changing your tyres, best do it soon. Apparently, there are a number of factors contributing to this predicted rise in car tyres prices, but amongst the most prominent is the fact that raw materials prices are continuing to increase around the world. And this includes steel, oil and textiles as well as natural rubber. Oddly, this affects budget car tyres prices more than premium brands.

In addition, because a number of manufacturers closed factories during the recession, car tyres prices may have to rise simply because there is now insufficient manufacturing capacity to meet the predicted demand. Moreover, last year’s particularly severe winter across much of Northern Europe fuelled unprecedented demand for winter tyres which pushed up car tyres prices. This means many manufacturers are having to replenish stocks of winter tyres ahead of next season’s demand. The inevitable result of all this is that car tyres prices will be on the increase for some time to come so ‘buy now’ seems to be the right message.

Car tyres prices are also affected by the fact that new car sales are now on the increase. And because many manufacturers are committed to supplying original equipment tyres, it’s clear that the availability of tyres for the replacement market is likely to be limited. The laws of supply and demand will inevitably mean rises in car tyres prices across the board. Indeed, the supply situation is already worsening, with many tyre retailers and wholesalers operating on significantly reduced stock levels and even running out of some sizes. Retailers of course, will be forced to increase car tyres prices to maintain their margins.

And as if this wasn’t enough, car tyres prices will be affected by rising fuel, warehousing and distribution costs; especially for tyres imported from the Far East. On top of that, don’t forget that there will be a 2.5% increase in car tyres prices when VAT goes up next January. So what’s the outlook for the average motorist? Well the truth is that whilst there is no need to panic, car tyres prices are likely to increase for some time and there may well be shortages-especially in the more popular sizes. Moreover, this could lead through to shortages in other sizes as manufacturers switch production to meet demand.