Plimsoll Publishing has issued a report outlining the parlous state of the tyre industry. They report that the industry is being hit by zero growth, falling profits and rising debts. All of which could lead to company failures or acquisitions over the coming months.
According to Plimsoll, 34 companies are rated as being in danger. Most of these companies are running at a loss and are taking on unmanageable debt in order to cover costs. David Pattison senior analyst at Plimsoll stressed that these companies (those rated danger) must put immediate plans in place to start to trade their way out of their problems. Cutting costs, jobs and even turning unprofitable work away- stringent measures must be put in place before it’s too late. Currently the owners are sitting on an ‘unsellable’ asset and are woefully exposed to acquirers who are ready to snap them up for next to nothing.”
The report will be of particular concern to the national chains who, as revealed in another report, are currently some 33 percent more expensive than their on-line rivals.