Bandag Southern Africa recently celebrated its 20th anniversary, having gained home rule from Bandag Incorporated (a USA company, founded in 1957) in 2004, operating as an independent entity since then. Bandag has been operating in South Africa since 1965 marking another milestone for the organisation – its 60th anniversary. Having defied immense odds amid a challenging retreading market and standing the real risk of losing the Bandag brand, the management team – John Laskarides, Laurent Colrat and Jonathan David – sat down with SA TREADS for a candid interview, to detail the reasons behind their ongoing growth and success, and their plans and ambitions for the company in the years ahead.
Following on your annual Conference in September, which we believe was a huge success, what was the overall message you shared with your dealer network, and how was it received?
Our primary message was that quality retreading in the TBR sector is here to stay, for the simple reason that it remains a cost viable option for South Africa’s transport f leets.
How did you go about conveying the message?
We presented a comprehensive 10-year case study (2014-2024), that revealed the effect of the cheap new tyres coming in from Asia, with 2014 being a milestone year, as it was the first time imported TBR tyres overtook sales of legacy products here in South Africa. And, in 2024 imports of new tyres accounted for a staggering 77% of sales across the country.
Over this same period, we have seen a 25% decline in the retreadability of casings coupled with a rise in the number of tyres that get scrapped in its first life. Interestingly, the TBR market has In 2024 imports of new tyres accounted for a staggering 77% of sales across the country. mushroomed, with the years 2023/24 recording an explosive growth of 8.65%. Based on reports, Chinese tyre imports accounted for 28% of the growth, while retreading declined by 3%. It is interesting to note that while tyre demand has increased, in the same period, diesel sales and fleet mileage have both reduced.
Together with the decrease in retreadability, this does leave us to believe that the increase in unit sales may be driven by inferior quality import truck tyres. There is no doubt that the onslaught of cheap new tyres coming in from Asia, is having a profoundly negative effect on the retreading sector. Notwithstanding, as far we are concerned, Chinese tyres, are not the enemy. The quality of some of these imports is.
The majority of these low-cost tyres coming in from Asian countries, is simply not suitable for retreading, with the casings being of low quality. This poses a threat to us, because quality retreading needs a quality tyre, which explains why stock retreading has dropped dramatically. As Bandag SA, one of the ways that we combat this is by promoting premium legacy brands and certain Chinese brands that we believe are retreadable (based on our testing and data collection) and will provide our fleet customers with the optimum cpk benefit.
So, how are you meeting this challenge?
By providing a complete solution to fleets that includes new tyres, retreading plus after-sales service. It’s not easy, but by conducting consistent fleet tyre inspections (we carry out more than 100 000 per month), we have managed to gather sufficient data that includes the individual performance of the more than 100 Chinese tyre brands currently in the market, to identify the best from the worst. Bear in mind, not all Chinese tyres are made equal. The Chinese manufacturers are quickly catching up to western manufacturers, with some Chinese brands now exhibiting similar quality standards.
Chinese tyre brands are here to stay, and we need to accept that, while learning to become more discerning. When it comes to our dealers, and because we will never consider joining the generic market, we announced the creation of a central data base, set up for the express purpose of gathering data on each of these brands, which our dealers can access. We cannot dictate to them when it comes to the new TBR products and brands they sell, but we are hoping the scientific data gathered will prompt them to get behind the more credible Asian brands, which can be retreaded.
This is not only important for their survival, but also for the country’s transport fleets. We recently conducted an exercise with one of our major national fleets which revealed that were they to run on new tyres exclusively, it would cost them an additional R7.7million thus showing that retreading delivers real economic return to the fleets ! Demonstrating the undisputable benefits of tyre retreading to the fleets, is something we will continue to pursue, vigorously. Our proximity to our customers allows us to provide tailor-made solutions that provide real cost savings using quality driven and reliable Bandag products, made right here in South Africa.
We are seeing a significant decline in fleet maintenance, which is essential to achieving a desired c.p.k. to keep their tyre costs from soaring, which is why we station our own fitters on site, to ensure the basics of tyre maintenance are not neglected and also to collect data which helps us to help our fleet customers to better manage their tyres and maintain their tyre costs.
What else do you believe differentiates you from your competitors?
Aside from investing in the new data base, products and people (we now employ more than 200), we have invested over R149million in our plant over the last few years, including solar panels, to ensure a streamlined operation during power cuts. Another distinguishing feature is that we are Proudly South African, which precures a measure of loyalty to us. The corporatecum-entrepreneurial culture we employ further allows us to remain flexible and agile, with the three of us at senior management level, able to make swift decisions.
More important, we are not only a supplier of precured rubber, but rather, a solutionsprovider to the fleets. For us, it’s not about selling more rubber, but about proving the reliability and performance of our products and services, that ultimately translate into savings for them. We strive to build and nurture our relationships with our customers, which is paying dividends for us, with two of our national fleets recently renewing their contracts, and new prospects on the horizon.
What assistance do you offer to your dealer network?
We would not be where we are today without the support and loyalty of our dealers, most of whom have been with us from the very beginning. To demonstrate our loyalty and protect their existence, we will also get involved in other aspects crucial to the market, such as waste tyres, anti-dumping legislation and the like. Having been recently nominated and accepted onto the Waste Tyre Committee, we are spending copious amounts of time negotiating a favourable industry solution with the Waste Bureau and Department of Forestry, Fisheries and the Environment (DFFE).
Bear in mind (by the very nature of their business), retreaders are also recyclers, so it is in our interests to ensure that we arrive at a stand-alone, independent waste tyre plan, and that the waste tyre levy paid over by the consumer, is correctly used for collecting and disposing of scrap tyres.
What is happening to all the scrap tyres that are being collected, seeing that the landfills are no longer accepting them?
That is a good question, and one that demands closer investigation. We have it on good authority that a considerable number are being shipped to India, for use in pyrolysis plants. This is of concern, as many tyres being relegated to the scrap tyre heap, could in fact be retreaded, which would greatly assist the retreading sector. DFFE is aware of these allegations, and we are working together to get to the bottom of it.
Apart from the lack of quality casings available for retreading, what other challenges is the retreading segment facing?
The contracting nature of the economy is of massive concern for all, manufacturers included, as the recent closure of the Goodyear plant demonstrates. Gross Domestic Production (GDP), a fluctuating foreign exchange, political instability, BEE, as well as a mentality towards a South African review globally, are all impacting gravely. The question now, is how best to position ourselves to grow, despite all these factors, over which we have little to no control.
We see legacy manufacturers closing tyre plants all over the world. This is a global trend, but for Bandag SA, manufacturing is our business, and we are here to stay. Continuing to invest in our Plant , ensuring compliance by way of eight ISO accreditations, and our ability to export to anywhere in the world, stands us in good stead. Not only do we have the capacity, expertise and flexibility to export, our willingness and capability to meet foreign demands with respect to compounds and designs, will further serve to preserve our presence and legacy here in South Africa.
Will you be releasing any new products into the market?
At our Conference, we announced the official launch of two new patterns, the R-Drive 001+ and the R-Trailer 002. Interestingly, the R-Drive 001+ following 3million kilometers of testing, to ensure the pattern was right for South African fleet applications, topped sales in September, thereby proving it is worth its mettle.
Any final thoughts?
Although South Africa constitutes only one percent of the global tyre market, we are a retread friendly country that that is home to two of the largest TBR retreading factories in the world, one of which is a Bandag franchisee.. We attribute this incredible achievement to our indomitable spirit – the South African DNA that is not afraid to take on challenges, that propels us to reinvent ourselves, whenever the occasion demands it.
Bandag Southern Africa (SA) became a licensee of Bandag International on 01 December 2004. The company became a South African business by way of a management buyout and continues to operate under this structure. In December 2006, Bandag and Bridgestone Americas Holding Inc. announced a merger that would make Bandag a wholly owned subsidiary of Bridgestone Americas. Bandag SA remains independent and continues to be part of the global Bandag brand together with its global standards.
