New Normal: Chinese Tires Increase in Prices

As a result of the shortage of tires and the increase in the cost of maritime freight, Costa Rican importers of Chinese tires estimate that prices in the local market have increased about 40% in recent months.

Friday, May 21, 2021

Representatives of Tire Kingdom, a company that imports tires manufactured in China in Costa Rica, foresee that due to the increase in prices, the main advantages of these tires could be reduced or disappear.

According to the businessmen, as a result of the Covid-19 outbreak, all plants closed at some point last year. This caused a shortage of Chinese tires and there are currently delays of a month and a half in deliveries.

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Alejandro Martin, owner of Tire Kingdom, told Elfinanciero.com that when restrictions began to be eliminated "... consumption shot up (and maritime freight tripled), this is a very strong blow to the industry since unlike products, the tire is very bulky and not so many fit in a container."

Martin added that "... last year tires manufactured in China represented around 65% of the market. This, however, is changing a little as the cost of Chinese tires, as a result of what has happened in recent months, is catching up with traditional tires."

Research by CentralAmericaData shows that from January to June 2020, companies in the region bought new tires abroad for $197 million, with Costa Rica being the only market that increased its imports and Panama the Central American country that most reduced its purchases in year-on-year terms.

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