By Alex Kapadia
Nokian tyres are predicting that further increases in the cost of raw material will continue to force prices up later this year.
The tyres manufacturer expects the rapid increase in raw material prices to continue unabated with a 10% to 12% hike in Europe compared to price levels for 2009.
The 10% to 12% estimate is roughly 6% more than Nokian officials originally predicted, according to the report by the Modern Tyre Dealer.
“This will affect Nokian Tyres’ results in the second half of the year,” company officials said during a recent presentation in Finland.
Nokian plans to hike prices in June as a result of raw material cost increases. The company also will shift its product mix in order to compensate for the dramatic increases.
Tyres manufacturers have struggled during the past year as the escalating prices of raw materials, including natural rubber and crude oil, have put added strain on their finances during the world wide recession.