Tire Prices Increase: Higher Commodity Costs To Blame

If you are a fleet manager, you may have felt the impact of the ever-increasing cost of tires. Private vehicle owners may not suffer the impact because they only change their tires once in a while. There is a major outcry among fleet companies because buying new tires is a frequent occurrence.

This increase in price has been attributed to the higher cost of commodities that are involved in the manufacturing of tires. Reports from different manufacturers have confirmed this. The cost of raw materials directly determines the cost of tires.

The Trend in Tire Prices

About five years ago, there was a significant decline in the price of tires because the cost of rubber was low. But after this, the price has been going up dramatically. During this period of five years, raw materials have become scarce, which increases demand for them. Tire manufacturers have been struggling to obtain the raw materials, let alone pay a higher cost for them.

They are left with no option other than to increase the price of tires to maintain the recommended profit margin. Generally, all reputable brands have to take this direction. Any tire brand that is significantly cheaper than the others raises questions about quality.

Raw Materials Involved in Making Tires

Tire Prices Increase

There are many raw materials that are involved in making new tires. If you are planning to overhaul your fleet vehicles, new tires are a must. You may also want to visit reputable websites like eyerideonline.com for fleet management solutions. Once you have found a seller for tires and other vehicle accessories, it is important to have a basic understanding of the raw materials that are involved in making tires.

Rubber – tires are all about rubber. It is the main component. So, when the prices go up, this is the main culprit. Its density determines the grade of tires; heavy-duty, medium-duty or light-duty tires are the options. Manufacturers either process their own rubber or buy it from other companies. When the cost is high, the tire will be more expensive as well.

Fabric and wires – to hold everything together, the manufacturers use these two materials. One can be used in place of the other depending on the results that are desired. For small vehicles, strong fabric is used while heavy vehicles with truck tires use wires. The price of these materials also determines the final cost of the tires.

Other Determinants of Tire Cost

Apart from the cost of raw materials, there are a few other determinants of the cost of tires. Different manufacturers use a variety of grades of rubber that include synthetic and natural types. They also use other processes to treat the tires so that they can maintain high quality. Such efforts will definitely have an impact on the price of tires.

Conclusion

The cost of tires in today’s market can be traced back to the cost of the raw materials that are used. Since they have been increasing in price, the cost of tires has also been going up. If you are a fleet manager or owner, you can now better understand this trend.

News Reporter
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