Retread tyres in Malaysia are unfairly blamed for road accidents. While the tyres enjoy a pristine reputation in export markets, the notoriety within the local market stems from the lack of ability to differentiate them from low-cost and low-quality tyres that fail to comply with performance standards owing to overloading, maintenance and misapplication.

A total of 1.35 million lives are lost each year in road accidents, according to data from the Ministry of Transport Malaysia. Another data set from Statista highlighted that the South Asian country witnessed 545,000 road accidents in 2022, an increase from the previous year data of 370,000.

A large portion of these accidents involve commercial vehicles and the blame is also shared by retread tyres. A recent news report highlighted rising concerns within the Malaysian parliament to ban the use of retread tyres of commercial vehicles citing safety norms.

The situation seems ironic as the Malaysian retread industry enjoys a pristine reputation in export markets. Yet, the notoriety of retread tyres on home turf might be seen as ‘collateral damage’.

Speaking to Tyre Trends exclusively on why retread tyres remain a scapegoat for road accidents, Tyre Retreading Manufacturers Association of Malaysia (TRMAM) President Edmund Wong said, “Retread tyres are often unfairly blamed for road accidents because the public struggles to differentiate them from low-cost, low-quality tyres that fail due to poor maintenance, overloading and misapplication. Many people mistakenly associate tyre debris, especially when it reveals exposed steel cords, with retreads. However, this type of failure is more commonly linked to cheap, substandard tyres rather than retreads, which, when properly maintained and used correctly, can be as safe as new tyres. The focus on retreads allows the real issues such as inadequate tyres maintenance and overloading to remain overlooked.”

IMPROVING ROAD SAFETY

Malaysia has a higher road fatality rate compared to ASEAN peers like Singapore, largely due to motorcycle-related deaths, which make up over 65 percent of fatalities.

Malaysia’s road safety goals have reportedly fallen short despite setting out clear targets. In 2014, the government aspired to reduce road fatalities by 50 percent by 2020 as part of its alignment with United Nations’ Decade of Action for Road Safety 2011-2020. The initiative was a failure and the same target was reiterated in Malaysia Road Safety Plan 2022-2030.

Current figures also raise questions over the supposed success of the target. Commenting on ways that could make the reduction target a reality, Wong noted, “To reduce road fatalities by 50 percent by 2030, Malaysia should enforce traffic laws strictly, including penalties for speeding and disobeying traffic lights, while expanding automated systems like speed and red-light cameras. Enhancing road infrastructure with safety audits, smart technology and dedicated motorcycle lanes is essential.”

“Malaysia can adopt best practices, such as dedicated motorcycle lanes, public education campaigns and improved road infrastructure, while learning from Singapore’s success in enforcement, infrastructure and safety culture. Public awareness campaigns should target risky behaviours including running red lights and promote defensive driving. Protecting vulnerable road users, especially motorcyclists and pedestrians, through improved infrastructure and safety regulations is also crucial,” he added.

Alluding to why stringent safety campaigns or regulatory measures are not undertaken to reduce motorbike fatalities, he noted, “The lack of stringent safety campaigns or regulatory measures targeting motorbike users in Malaysia is due to several factors. Firstly, motorbikes are a vital mode of transport for many due to affordability and accessibility, especially in rural areas, making stricter regulations politically sensitive. Secondly, enforcement of existing laws such as helmet use and licensing is inconsistent, particularly in rural regions, allowing unsafe practices to persist. Thirdly, cultural factors like risk-taking behaviour, resistance to change and low awareness of safety risks hinder the adoption of safer practices. Lastly, limited resources, both financial and infrastructural, result in insufficient investment in targeted campaigns and dedicated motorcycle lanes, leaving riders vulnerable.”

CLOSING GAPS

Wong iterated that to improve road safety and support the retreading industry in Malaysia, several regulatory gaps and enforcement lapses need to be addressed. One significant issue is the inconsistent enforcement of tyre standards, especially for imported new tyres.

While Malaysia requires that imported tyres have certifications like the E-mark, DOT or MS, these standards can sometimes fail to verify the genuineness and reliability of the tyres, leading to concerns about the quality and safety of some imports. This lack of stringent checks on tyres authenticity puts road users at risk and undermines confidence in tyre safety.

Additionally, there is a gap in regulations requiring regular tyre maintenance checks, particularly for retread tyres. Without mandatory inspections for tread depth, pressure and overall tyre condition, vehicles, especially commercial fleets, are at higher risk of tyre-related accidents.

Another issue is the weak enforcement of penalties for overloading and the misapplication of tyres such as using retreads in unsuitable conditions. Overloading vehicles puts excessive stress on tyres, increasing the likelihood of tyre failure, and stricter penalties are needed to deter this dangerous practice.

There is limited education on the benefits of retreads and how to use them safely, which affects their acceptance and proper usage. Implementing campaigns that highlight the safety, environmental and economic benefits of retreads could help improve perceptions and encourage safer practices.

Moreover, government procurement policies should prioritise retread tyres for public transportation fleets, encouraging their use across sectors and providing a market boost to the retreading industry.

Lastly, there is a lack of clear regulations on tyre end-of-life management including guidelines for recycling and disposal. Establishing clear regulations for the responsible management of worn-out tyre, including retreads, would support the circular economy and further promote the sustainability of the retreading industry.

Addressing these regulatory gaps and enforcement lapses would not only improve road safety but also foster the growth of a reliable, safe and sustainable retreading industry in Malaysia.

REPUTATION REVIVAL

The shadow of malignance over the local retread industry is daunting, especially considering its stellar reputation abroad. A methodical plan is urgently needed to change the prevailing perception.

Commenting on how the industry can leverage its foreign reputation to promote retreads domestically, Wong explained, “Malaysia can leverage its reputation in the global retreading industry to promote retreads domestically by focusing on education, policy support and sustainability initiatives.”

“Firstly, educating the public about the benefits of retreads, such as safety, environmental advantages and cost-effectiveness, can shift perceptions. Secondly, incentivising businesses to adopt retread tyres would not only increase its usage but also align with sustainability practices. Retreads significantly reduce waste by reusing tyre casings, contributing to lower carbon footprints and less landfill waste. Offering tax breaks, rebates or financial incentives to businesses that adopt retreads can encourage the adoption of this eco-friendly practice, benefiting both companies and the environment,” he added.

He also noted that Malaysia has a well-established certification system with Malaysian Standard 224 (MS 224), which sets high-quality standards for retread tyres. This national standard ensures that domestically produced retreads meet rigorous safety and quality requirements, reinforcing consumer confidence and helping local manufacturers maintain global competitiveness. By promoting this certification and its benefits, Malaysia can further build trust in its retreading industry and drive domestic demand for high-quality retreads.

He also noted that partnerships with universities, research institutions and organisations such as the Malaysian Rubber Board (MRB) could play a pivotal role in establishing Malaysia as a hub for innovation in tyre retreading. These collaborations would enable research and development focused on improving the quality, safety and efficiency of retread tyre, which could enhance their appeal domestically and internationally.

“The Malaysian Rubber Board has extensive expertise in rubber technology and the development of new rubber compounds, which are crucial for retreading. By working with these organisations, Malaysia could explore advanced rubber materials and improve the durability and performance of retread tyres. MRB’s research could focus on optimising the rubber used in tyre retreading, enhancing its resilience and performance under various road conditions, thus improving the overall safety of retreads. Universities and research institutions bring additional expertise in materials science, engineering and sustainability and can help address any technical gaps in the retreading process. They could collaborate with retreading companies, fleet operators and tyre manufacturers to develop new retreading technologies, better tyre monitoring systems and more efficient processes,” explained Wong.

He added, “These partnerships could also produce credible, science-backed data on the reliability and safety of retread tyre, helping to build public trust and dispel misconceptions about retreads.”

FILLING DATA GAPS

The lack of local data to validate the reliability and safety of both retread and new tyres in Malaysia stems from several key factors, according to Wong.

“Primarily, there is a significant gap in research due to the lack of collaboration between tyre manufacturers, retreaders, fleet operators, research institutions and government agencies. Without cooperation among these stakeholders, there is little incentive or infrastructure to collect and analyse tyre failure data in the local context. This leads to a situation where tyre failure research is outdated or non-existent, leaving the industry to rely on studies from other countries such as US, which may be many years old and not reflective of current tyre technology or local conditions,” noted Wong.

He added, “This problem is not unique to Malaysia; many countries face similar challenges in gathering and sharing tyre-related data. For example, tyre debris reports and studies on tyre failures tend to be infrequent and may not accurately capture the complexities of modern tyre usage, road conditions or fleet operations. To address this gap, a collaborative effort among different stakeholders, both local and international, could be instrumental.”

Collaborations could fund and conduct comprehensive studies on tyres performance under local conditions. By sharing data and expertise, these stakeholders can develop a more accurate understanding of the causes of tyre failures, improve maintenance practices and promote better safety standards for both new and retread tyres.

Additionally, international partnerships could allow for access to global tyre failure databases and new research, enabling Malaysia to adopt best practices from countries like US, Japan or the EU, where more tyre safety research is available.

Establishing a framework for ongoing research and data sharing with regular updates and reports would help fill the data gap and improve tyre safety standards locally. This collaborative approach could ultimately lead to the development of localised tyre safety standards, improved regulations and more informed decision-making by all stakeholders involved.

NEW LEARNING

According to Wong, Malaysia can learn important lessons from countries like Japan and UK, where retread tyres are promoted effectively for their cost-efficiency and environmental benefits. Both Japan and the UK have robust local manufacturing industries for new, high-quality tyres, which ensure a consistent supply of durable tyre casings for retreading.

This industrial advantage helps protect the respective retreading industries by ensuring the availability of reliable casings that meet safety and performance requirements. Japan enforces stringent standards for both new and retread tyres through the Japanese Industrial Standards (JIS) such as JIS D 4202, which defines specifications for automobile tyres. These regulations ensure high-quality tyre production and maintenance, supporting a thriving retreading ecosystem.

Similarly, UK relies on the ‘E’ mark certification system, which aligns with European safety and performance regulations. The ‘E’ mark, prominently displayed on compliant tyres, indicates that a tyre has undergone rigorous testing and meets safety standards. This harmonised approach in UK ensures that only certified-quality tyres are used, reducing risks and building trust in retread tyres.

In Malaysia, the absence of a local new tyre manufacturing industry for trucks presents a challenge. The reliance on imported new tyres, coupled with the fact that Malaysia’s new tyre standard (MS 1394) is not compulsory, allows low-cost and lower-quality imports to flood the market.

These tyres often produce casings unsuitable for retreading, which undermines the retreading industry. To address these issues, Malaysia could make MS 1394 mandatory for new tyres, ensuring better-quality casings and fostering trust in retreads.

Additionally, promoting awareness of retreads’ economic and environmental benefits, strengthening enforcement of Malaysian Standard 224 (MS 224) for retread quality and offering incentives for their adoption could help the industry grow.

Technology, such as tyre monitoring systems, can play a significant role in addressing concerns about retread tyres and improving road safety. These systems provide real-time data on tyre pressure, temperature, tread depth and overall tyre health, helping to ensure that all tyres, including retreads, are properly maintained.

By monitoring tyre performance, these systems can detect early signs of wear, overloading or misapplication, reducing the risk of tyre failure. This not only enhances the safety of retread tyre but also helps prevent accidents caused by poor tyre maintenance or low-quality tyres, leading to a change in perception.

JK Tyre & Industries is aiming for double-digit revenue growth in FY2026, outpacing its forecast for single-digit expansion across the broader tyre industry. Managing Director Anshuman Singhania outlined the company’s ambitions during a post-earnings media call, underscoring confidence in demand recovery and strategic market positioning.

Q1 Performance Overview

For the first quarter of FY2026, JK Tyre reported revenue of INR 38.91 billion, with EBITDA at INR 4.24 billion, translating to a margin of 10 percent. Net profit stood at ₹1.55 billion — up 51 percent compared with the previous quarter, but down 21 percent YoY.

Singhania attributed the annual decline to muted original equipment (OE) demand, particularly in truck and bus radial (TBR) volumes, alongside higher raw material costs compared to the same period last year. He also highlighted an adverse impact from the company’s Tornel business in Mexico, which faced uncertainty due to tariffs on exports from Mexico to the United States, dampening volumes.

Resilience in Domestic and Export Markets

Dr Raghupati Singhania, Chairman and Managing Director, JK Tyre & Industries, said, “The growth momentum in domestic markets remained robust in Q1, with JK Tyre clocking a sales growth of 11 percent YoY, as contributed by a steady demand for our products in both replacement as well as OE segments, underscoring JK Tyre’s continued focus on core growth drivers and strengthening market presence.”

“Despite a challenging and uncertain macro-economic environment, exports of passenger car tyres witnessed a strong traction both on QoQ and YoY basis, signifying pull for our products and enhanced brand perception in the global markets,” said Dr Singhania.

Operational efficiencies and strategic pricing supported performance, even as natural rubber prices remained elevated. Subsidiaries Cavendish (India) and Tornel (Mexico) continued to contribute significantly to the group’s consolidated financials.

Operational efficiencies and strategic pricing supported performance, even as natural rubber prices remained elevated. Subsidiaries Cavendish (India) and Tornel (Mexico) continued to contribute significantly to the group’s consolidated financials.

Regarding trade tensions between India and the US, Anshuman Singhania noted that exports from India to the US account for only around 3 percent of JK Tyre’s revenue and could be redirected to markets such as Mexico, Latin America, Brazil and the UAE if required. With zero tariffs in Mexico, JK Tyre can utilise its production base there to meet demand for both passenger and truck radials. The EU and UK, where JK Tyre holds a strong position in the TBR segment, also remain tariff-free.

Capacity expansion

The company’s INR 14 billion capital expenditure plan is progressing on schedule, covering passenger car radial (PCR), TBR and all-steel truck radial projects. For the year, investment is expected to total INR 9-10 billion, aimed at boosting production capacity by 30-40 percent.

A key driver for future profitability is the shift towards premium products. The share of 16-inch and above passenger car tyres in JK Tyre’s portfolio has grown from 18 percent in FY2020 to 25 percent in FY2025, with a target of 40-45 percent over the next two to three years. This change is being fuelled by rising SUV sales, larger rim sizes in entry-level cars and strong export demand.

The company has also developed a complete range of tyres for electric vehicles, spanning commercial truck radials, bus tyres, passenger radials and two/three-wheeler tyres  Major OEMs such as Ashok Leyland’s Switch Mobility and Tata Motors are sourcing these products, including for last-mile connectivity vehicles and newly launched EV buses.

Market Outlook

The replacement market has been a bright spot, with passenger radial volumes up 32 percent year-on-year and truck radial volumes growing in the high single digits. JK Tyre expects demand to strengthen in the second half of FY2026, supported by infrastructure development, a favourable monsoon, potential interest rate cuts, and improved consumer liquidity.

Anshuman Singhania stressed that the worst of raw material price pressures appear to be over, paving the way for margin improvement as the product mix shifts and capacity utilisation rises. With the small car segment’s gradual decline offset by growth in premium categories, JK Tyre remains confident in sustaining momentum.

“Overall, India is poised for growth,” Singhania concluded. “We see positives across the board — from infrastructure push to evolving consumer preferences — and we are well-positioned to capitalise on these trends.”

Yokohama Rubber has begun supplying its ADVAN V61 tyres as original equipment for BYD’s new SEALION 6 DM-i SUV, marking the Japanese manufacturer’s first OE partnership with the Chinese carmaker.

The SEALION 6 DM-i, a plug-in hybrid SUV launched by BYD Company Ltd. this July, is being factory-fitted with 235/50R19 103V size ADVAN V61 tyres. The announcement comes as Yokohama seeks to grow its footprint in China’s fast-evolving electric and hybrid vehicle market.

The ADVAN V61 is part of Yokohama’s global flagship ADVAN range and is positioned as a premium SUV tyre. The company said the tyre “offers ADVAN’s hallmark premium-grade driving performance, along with a high-level balance of fuel and energy efficiency, handling stability, and quietness, achieving both comfortable city driving and long-distance touring for heavyweight SUVs.”

The SEALION 6 DM-i combines a 1.5-litre naturally aspirated petrol engine producing up to 74kW with an electric motor generating 160kW. Buyers can choose between 18.3 kWh and 26.6 kWh blade battery options, offering electric driving ranges of 93km and 130km, respectively. All models come equipped with advanced driver assistance systems as standard, and the exterior design draws inspiration from the concept of “ocean aesthetics.”

Sumitomo Rubber Industries Ltd said its subsidiary Dunlop Tyre Japan Ltd has completed a Japan Fair Trade Commission investigation into automotive all-season tyre sales after the regulator approved a commitment plan submitted by the unit.

The probe, which examined the subsidiary’s sales practices, concluded without the commission identifying any violation of Japan’s Antimonopoly Act, Sumitomo Rubber said in a statement.

Under Japan’s commitment procedures, companies can submit plans to address potential competition concerns without admitting wrongdoing, allowing them to resolve investigations while avoiding formal sanctions.

"We deeply apologise for the great trouble and anxiety that we have caused to all concerned, including our clients and business partners,” the tyre maker said.

Belgian steel wire maker Bekaert reported resilient first-half 2025 earnings as strong cash generation and cost control offset softer sales, but warned that tariffs and currency pressures are weighing on demand.

The company posted consolidated sales of €1.9 billion, down 5.2 percent year-on-year, with volumes declining 2.6 percent and price/mix effects stripping out a further 2.2 percent. Underlying EBIT slipped 16.2 percent to €171 million, delivering a margin of 8.8 percent compared with 9.9 percent a year earlier.

Free cash flow surged to €123 million from €43 million in the prior-year period, driven by a €135 million reduction in working capital and €21 million in cost savings as the company continued to streamline operations and rein in capex. Net debt fell to €327 million from €399 million despite a continuing €200 million share buyback programme, €74 million of which has been completed.

“We have continued to focus on what we can control best – cash flow and costs - and have significantly reduced overheads and working capital in H1 2025,” chief executive Yves Kerstens said. “Equally, I am very pleased with the hard work of our teams fighting for volumes in the current challenging markets.”

He added: “We are also taking further steps to make our business units more autonomous and agile. Therefore, I am very confident that we will come out of the current business environment stronger and more cost competitive than ever before.”

Bekaert said volumes were particularly strong in its Steel Wire Solutions and Rubber Reinforcement divisions in the United States and China, while European and Latin American demand lagged. Its Brazilian joint ventures delivered €24 million in net profit share, up from €20 million a year ago.

However, the group cautioned that growing trade tensions – including a rise in US steel tariffs from 25 percent to 50 percent – and the weakening of the US dollar and Chinese yuan against the euro were eroding pricing power and softening orders.

“Following a period of resilience in Q2, the tariff uncertainty and weakening economic outlook has started to have an impact on demand,” Bekaert said.

The company now expects slightly lower full-year 2025 sales on a like-for-like basis, with an underlying EBIT margin of between 8.0 percent and 8.5 percent, down from 8.8 percent in the first half.