Budget tyres in Latvia may rise in price by 15–20% — LSM English

In Latvia, drivers planning to buy new winter tyres should prepare for higher prices and possible shortages of certain sizes. As LSM English reports, one of the main factors is the EU’s anti-dumping duties on Chinese-made tyres, which came into force in the summer.

For companies that cooperated with the European Commission’s investigation, the duty is 24.4%. For manufacturers that did not cooperate with the investigation, the rate reaches 45.3%. Latvia’s Ministry of Foreign Affairs explained that the duties were introduced because Chinese companies had long artificially kept prices lower on the European market, harming the European tyre manufacturing sector.

Budget segment

Gundars Liekne, a representative of auto parts retailer Inter Cars, said the company had tried to import Chinese, meaning budget, tyres before the duties took effect. According to him, some Chinese manufacturers began relocating factories to other countries to avoid the higher tariff. Liekne estimated a possible average price increase of 15–20%.

The price rise may primarily affect budget tyres, which account for approximately two-thirds of Latvia’s new tyre market. Gints Ulnicans, head of Riepu garāža, noted that prices could eventually rise in the premium segment as well due to higher costs of raw materials and labour, as well as slower vehicle production in Europe.

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Supply and availability

According to Liekne, relocating factories and establishing new supply chains could lead to shortages of tyres in certain sizes. This particularly concerns soft-compound and studded models needed in Latvia, Estonia and Scandinavia. Manufacturers primarily focus on mass demand for European-type tyres, so supply may be limited in some segments.

Military conflicts in the Middle East are also complicating supplies from Asia: cargo ships are taking alternative routes, which extends delivery by approximately 15 days and increases transportation costs. Ulnicans said that shipping a container can cost from $2,500 to $9,000. A container holds around 900–1,000 tyres, so fluctuations in freight rates can add $7–8 to the cost of one tyre.

Winter tyres are mandatory in Latvia from 1 December. Experts also warned of possible problems with availability and prices of motor oils and other automotive lubricants in the coming months.