A tyre being retreaded

India’s retreading industry closes 2025 on a turbulent note, shaped by volatile demand, uneven GST reforms, rising compliance costs and a partial enforcement of the Extended Producer Responsibility (EPR) regime.

The year began with optimism as pre-cured tread (PCT) sales moved up on the back of growing radialisation and sustained awareness initiatives, but that momentum faded mid-year as policy shifts and softer fleet sentiments weighed down volumes. Retreading companies say 2025 has been defined as much by regulatory shocks as by the struggle to recover pricing power in an increasingly competitive market.

According to Tyre Retreading and Education Association Chairman, Karun Sangi, overall retreading volumes declined through 2025, especially for businesses dependent on larger fleets. Fleet operators delayed retreading cycles as freight movement stayed inconsistent and as the widening GST gap altered cost economics.

Sangi explained that the GST cut on new tractor tyres from 28 percent to 18 percent dramatically changed fleet behaviour. “When the GST on new tractor tyres fell by 10 percentage points, it became easier and cheaper for fleet owners and small operators to opt for new tyres rather than retreading them. This has impacted retreading volumes significantly.”

Retreading GST remains at 18 percent, creating a distortion that disproportionately hurts small farmers and rural operators who traditionally preferred retreaded tyres for cost savings.

Sangi noted that radialisation in the truck and bus segment continued expanding, but many fleets still hesitate to pay for high-quality PCTR material. He stated, “There is a mindset shift that is still incomplete. Radial tyres require proper retreading practices and quality material to deliver full casing life. But many fleet owners still focus only on upfront cost.”

This behaviour forced retreaders to hold pricing steady even as raw material costs rose through the year. Smaller retreaders, lacking scale, were hit hardest, resulting in thinning margins across the industry.

Another major stressor was the implementation of the EPR framework for end-of-life tyres. According to Sangi, the EPR system, although essential for environmental compliance, has created bottlenecks for smaller players.

“EPR has made processes slower, approvals tighter and paperwork heavier. The industry agrees with the intent, but implementation needs streamlining, or SMEs will not survive,” he said.  

Retreaders who buy used casings from dealers or fleets now face documentation challenges and ambiguous compliance norms, particularly when handling multi-state movements of scrap tyres.

Sangi emphasised that retreaders have long been part of the circular economy and over-regulation could undermine a segment that inherently extends tyre life and reduces waste.

Treads in disarray

Echoing similar concerns, Kolkata-based Supreme Treads’ Director, Rajesh Verma, said that 2025 has been a difficult year marked by falling demand and rising input costs. He pointed to weak commercial vehicle movement, especially in the long-haul trucking segment, as a key factor.

“When truck utilisation drops, tyre wear drops. That automatically delays retreading cycles and that’s exactly what we saw in 2025,” he explained. Verma added that patchy freight during monsoons and the prolonged slowdown in construction activity further reduced tyre consumption.

Verma highlighted that customers also shifted back towards new tyres due to aggressive discounting by OEMs and Tier-II tyre brands. According to him, “We noticed that many smaller fleets were offered attractive upfront prices for new tyres, almost matching retread economics. For them, the choice became simpler.”

This price war undermined retreaders’ ability to raise rates despite increases in rubber, carbon black and labour costs. He reiterated that while overall radialisation is good for long-term industry health, retread quality across India remains inconsistent because of unorganised operators offering low-priced, low-quality jobs.

One of the leading tread makers of the country, Indag Rubber, echoed the same sentiment. The company’s Senior General Manager Rohit Kapoor said, “Since the start of CY2025, the industry witnessed an uptick in pre-cured tread demand, driven by greater customer awareness around the operational and environmental benefits of retreading. The rising commercial adoption of radial TBR tyres further encouraged fleet operators to opt for retreading as a way to extend tyre life and reduce running costs. However, the September GST reform proved to be a setback: while the tax on new tyres was reduced, the rate on retreaded tyres remained unchanged. This narrowed the price advantage and caused market volumes to fluctuate, although we expect a gradual recovery and steady growth in the coming year.”

He added, “The retreading sector had anticipated that the industry would be included in the GST revisions, given its role in circularity and resource efficiency. We have consistently engaged with policymakers to advocate for a lower tax rate on retreaded tyres and services, in line with global sustainability goals and waste-tyre regulations. Discussions with the authorities are ongoing, and while no formal roadmap has been communicated yet, we remain confident that the policy direction will eventually align with circular-economy principles and support tax rationalisation for retreading.”

2026 Outlook

Both Sangi and Verma agree that despite 2025’s setbacks, the long-term fundamentals of retreading remain strong because India’s expanding logistics and transportation ecosystem will continue to rely on cost-efficient tyre lifecycle management.

Sangi stressed that the industry needs GST rationalisation and smoother EPR processes. Verma added that technology adoption will be crucial for regaining customer trust and delivering consistent performance across applications.

As the year ends, the industry finds itself at an inflection point as the demand turbulence of 2025 exposed structural issues but also clarified what retreaders must prioritise in 2026 viz-a-viz quality, compliance readiness, customer education and tighter collaboration with fleet operators.

The segment has weathered a difficult year, but its intrinsic value proposition of extending tyre life at one-third the cost of a new tyre remains compelling. India’s push for sustainability and rising pressure on operating costs could well reposition retreading as a growth industry again, provided policy and market forces move in alignment.

Evonik, a global speciality chemicals company, has outlined a three-year strategy to sharpen its focus and accelerate growth, assigning distinct roles across its business portfolio and setting specific tasks for its major German sites. Targeted growth projects are also intended to improve the group's geostrategic balance. To fund these investments, the company is relying on its Evonik Tailor Made restructuring programme to further reduce its cost base. The plan involves cutting 3,200 jobs worldwide, with roughly 2,150 of those losses falling in Germany.

At the annual strategy meeting, the executive and supervisory boards reviewed plans through 2030. Interim CEO Claus Rettig said the industry faces a structural and economic crisis, and Evonik will use this polycrisis to reshape old structures and improve its positioning. Many parts of the business are still growing, so efforts will concentrate on strengths, future topics and lucrative markets, with better cost positions creating room to manoeuvre.

Transformation will proceed at every level. Healthcare and biotechnology projects in Canada and Slovakia, worth several hundred million euros, will strengthen the portfolio, while business units are aligned by role as growth drivers or cash generators. A new business line, Designed Polymer Solutions, bundles growth areas in aerospace, automotive and gas separation, including biogas and hydrogen. Asia and America offer strong opportunities, and further investments there are under review. Each of the six major German sites will receive a clear profile, with implementation starting shortly.

Evonik is also exiting activities with no internal prospects. Rettig said long-term leadership requires leading in what the company does, and volatility demands flexible responses. Closures of smaller sites fit this approach, and divestments of C4 chemicals and infrastructure are progressing as planned. Tailor Made's second phase begins in 2027 and runs to 2029. Measures will be finalised by late 2026, including unfilled vacancies, early retirements and voluntary severance departures. Chief Human Resources Officer Thomas Wessel said Evonik has long lived social responsibility and maintained intensive dialogue with employee representatives, and this transformation will be completed together.

Continental recently showcased its new TerrainContact A/T2 tyre during a five-day driving event in Iceland, held from 14 to 18 September 2026. Journalists and invited customers tested the tyre across winding roads, rugged highlands, glaciers and volcanic terrain.

Starting at Þingvellir, the group travelled through Iceland's Western Highlands and the Kaldidalur valley, where gravel routes highlighted the tyre's blend of on-road comfort and off-road traction. The TerrainContact A/T2 targets pickup and SUV owners who mainly drive on pavement but require extra grip when conditions change.

Compared with its predecessor, the tyre offers better wet braking and snow traction while preserving a quiet ride and off-road ability. A new tread compound boosts wet performance, greater tread depth aids snow grip, and optimised zig-zag grooves and traction teeth add control on loose or snowy surfaces. It carries the Three-Peak Mountain Snowflake symbol and is engineered with electric vehicles in mind.

Okan Sen, National Marketing Manager, Continental Tire Canada, said, “The TerrainContact A/T2, as one of the best-balanced performance all-terrain tyres in the market, was developed for drivers who want the freedom to explore without compromising their everyday driving experience. Iceland was the perfect setting to bring that versatility to life, giving attendees the opportunity to experience the tire across the kind of changing terrain it was designed to handle.”

A new Oxford Economics study commissioned by Tyres Europe underscores the tyre sector's vital economic and social contribution, arriving as Brussels shapes its Industrial Accelerator Act to reinforce European industrial competitiveness. The report, titled ‘The Critical Importance of the EU Tyre Industry’, makes the case that EU industrial policy ought to encompass the finished products sustaining Europe's economy and essential services, rather than focusing solely on raw materials and technologies.

Through the lens of tyres, the research maps the relationships between European manufacturing capacity, reliance on external sources and the smooth operation of mobility, freight and public services. It concludes that EU-produced tyres potentially enabled freight, agriculture and passenger transport, directly yielding EUR 1.5 trillion in GDP – 9 percent of the EU's total – and providing work for 30.5 million people, 13 percent of EU employment.

The study further reveals exposure on both sides of the tyre value chain. Imported intermediate inputs constitute 11.9 percent of EU tyre production value, exceeding the EU economy average of 7 percent, while natural rubber supplies depend wholly on imports. In 2024, imported tyres made up 40 percent of newly fitted tyres across the EU, a proportion that continues to climb.

Adam McCarthy, Secretary General, Tyres Europe, said, “Economic resilience depends not only on access to materials but also on retaining the capacity to transform them into safe, advanced products in Europe. The Industrial Accelerator Act is an opportunity to recognise strategically-important finished products and support competitive manufacturing in Europe. A strong EU tyre manufacturing base reduces reliance on external suppliers and helps build a more resilient, competitive automotive value chain.”

Pete Collings, Managing Director, Oxford Economics, said, “Europe’s tyre industry is far more than a manufacturing sector: it is a critical enabler of mobility, trade and wider economic activity. Our analysis shows that EU-produced tyres support hundreds of billions of euros in GDP and millions of jobs across key customer sectors, while the industry itself depends on complex global supply chains. The findings underline the economic value of maintaining a strong European tyre manufacturing base.”

The J&K Bank presents JK Tyre Rally of Himalayas 2026, a premier Cross Country Rally, was flagged off from Manali on 26 September. Organised by Himalayan Xtreme Motorsports and Adventure X Fusion Tribe, the sixth edition achieved a significant milestone by entering the Zanskar region for the first time. The ceremonial start occurred at 5:00 PM at Dev Lok, 15th Mile, near Span Resort, Manali. Bhuvneshwar Gaur, MLA Manali, served as Chief Guest, joined by V P S. Jasrotia, Deputy General Manager of Jammu & Kashmir Bank, as Guest of Honour alongside JK Tyre officials. The rally is supported by J&K Bank as Presenting Sponsor, JK Tyre as Title Sponsor, Ladakh Tourism as Official Sponsor and Impulse and Liqui Moly as Partners.

The competition features 140 participants across Moto, Extreme and TSD categories over five days in the formidable Himalayas. The route traverses Kaza, Jispa, Padum and Pensi La before concluding in Padum, Zanskar, on 30 September. The Moto category includes 80 riders, among them one female rider. The Extreme category comprises 35 participants, including two female drivers and five Army teams. The TSD category has 24 competitors, four of whom are female, testing precision, timing and navigation. This diverse field includes professionals, private entrants, women and Army teams.

This edition serves as a tribute to Hari Singh, the legendary Gypsy King and five-time National Rally Champion, whose legacy inspires competitors. The event's defining feature is its inaugural entry into Zanskar, introducing high-altitude terrain, remote landscapes, long competitive sections and shifting Himalayan conditions. From Kaza, competitors progress to Jispa and into Zanskar, tackling Padum and Pensi La before returning to Padum. Preparation, navigation, endurance and reliability become critical. Since its 2021 inception, the rally has grown into a demanding platform testing riders and drivers against Himalayan challenges.

JK Tyre, synonymous with Indian motorsport, continues its legacy rooted in rallying, embodying endurance and adventure. For J&K Bank, supporting the event reflects nearly nine decades of commitment to regional development and showcases tourism potential. The Department of Tourism, UT Ladakh, partners as a sponsor to position Zanskar as a premier adventure tourism destination, highlighting landscapes, heritage and driving routes to national and international audiences.