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Epidemic Cause the Bankruptcy of Large Tire Dealers

Category: Industry trends Author: Source: Release time: 2021-11-23

In 2020, the sudden COVID-19 has caused a severe impact on the global tire industry. Overseas, many tire factories have closed down. Even after the resumption of production, the production capacity of tires has been greatly reduced. The epidemic has slowed down economic activities, reduced people's daily travel and the terminal market demand for overseas tires has always been in a downturn.

 

Everyone thought that the epidemic would eliminate at the end of 2020 and that 2021 would be better. However, until 2021, the overseas COVID-19 epidemic is still severe. Many tire companies that had barely survived in 2020 will go bankrupt under another blow from the market in 2021. Many overseas distributors, retailers, and chain stores have fallen into bankruptcy.

Bankruptcy Of Large Tire Dealers

1. Bankruptcy of large tire dealers

 

Pneus Service is a veteran tire dealer in Europe, founded in Italy and started in 1980. During its more than 40 years of development, it has been very smooth. The company has gradually developed from an initial tire distributor to a large group enterprise integrating tires, steel rims, and maintenance services. The company's turnover reached the highest in history in 2019, about 15 million euros (approximately 120 million yuan).

 

What is unexpected is that 2019 is the company's last golden age, and the subsequent outbreak of COVID-19 completely destroyed this tire dealer.

Pneus Service

Barigazzi, the boss of the tire dealer, said that since the outbreak of COVID-19 in February 2020, the company has begun to decline, financial difficulties have been encountered unprecedented, and the cost pressure of the company's management is huge. The following March, April, and May were the most difficult three months for the company. Everyone was in dire straits, which could be called the "dark moments" in the company's history.

 

In 2020, the company's monthly sales year-on-year decline will basically remain at 80-90%. However, they have been insisting, believing that the epidemic will pass soon and the market will recover soon, and they are constantly looking for ways to help the company through the winter of 2020.

 

Unfortunately, hopes of market recovery in the winter of 2020 were completely shattered by the epidemic. This company, which originally had hoped in 2021, did not expect the epidemic to continue. It had no choice but to declare bankruptcy.

Pneus Service

Recently, Pneus Service, which has been in business for 40 years, officially declared bankruptcy. The Parma Court of Italy issued a judgment and declared Pneus Service officially bankrupt.

 

2. The epidemic has accelerated the bankruptcy of European and American tire dealers

 

Since the epidemic that began last year, many well-known tire dealers in Europe and the United States have gone bankrupt, the largest of which is FinTyre, a large European tire distributor that went bankrupt last year.

 

In February 2020, FinTyre, a large European tire dealer, declared bankruptcy, which shocked the tire industry. FinTyre is Europe's leading tire distributor, and the bankrupt Reifen Krieg is the leader in the German replacement tire distribution market, occupying approximately 10% of the German market. However, the business that cannot make ends meet will eventually destroy the company completely.

FinTyre

Fintyre is headquartered in London. In June 2018, Fintyre completed the acquisition of the German Reifen Krieg Group. Before the acquisition, the Reifen Krieg Group was a leader in the distribution of replacement tires in Germany. The company was founded in 2007 and is well-known for its complete brand and product range. It is headquartered in Neuhof, Germany. As a well-known tire dealer in Germany, it sells approximately 3.5 million tires each year (including passenger car tires, motorcycle tires, and truck tires), and it also sells more than 5 million steel or alloy wheels each year. The annual turnover of Reifen Krieg when it closed in 2017 was approximately 330 million euros (approximately 2.5 billion yuan). In 2017, approximately 40 million tires were sold in the German market. According to the latest data, the group's sales are approximately 1 billion euros.

German Reifen Krieg Group

In 2021, Europe and the United States are still affected by the epidemic, and tire companies and distributors are facing challenges for the operation. Dealers who have been struggling for more than a year found it is hard to survive another year. This year will definitely accelerate the dealer's bankruptcy. However, the status quo of tire dealers in China is better.

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