STARCO raises prices due to increased raw material costs
After a period of relatively stable and low raw material prices, the wheel and tyre industry is now experiencing extensive price increases for both rubber and steel. All major tyre manufacturers have already announced price increases, and although STARCO has fought hard to mitigate these increases, they now have to pass some of this to their customers.
“We see expected yet intense increases of the raw material prices. We are ready to ‘eat’ our part whilst we unfortunately see the necessity to pass a part of the increase on to our customers,” states Thomas Ballegaard, Chief Commercial Officer at STARCO.
The steel prices increased significantly throughout of 2016 and continue the trend in 2017. Now the natural and synthetic rubber prices follow suit with an increase of up to 75 percent in the last three months.
“When raw materials were reducing and at their low point, our price levels to our customers reflected this, however now it’s unfortunately the other way around. In general, our customers know it’s a cycle and understand its impact on our product offering to them, even though announcing lower prices to customers is much more fun,” says Thomas Ballegaard, Chief Commercial Officer at STARCO.
The rise in raw material prices impacts all STARCO’s market segments, although of course they are not on their own. The competitors, suppliers and any product with a high steel and rubber content will be affected by the current upward trend.
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