European tyre makers received an early Christmas week as Luxembourg announced that it is mandatory in the duchy’s road to used snow tyres.
Turkey, Poland and Belgium might also be receiving their gift along the way as the European Union is discussing of making the use of snow tyres be mandatory during the winter time which can help the tyre industry that was on the hedge for some time.
According to Sascha Gommel, analyst at the Commerzbank in Frankfurt, the pricing of the tyres from the tyre makers are now becoming favorable when compared to the tyres from the auto manufacturers.
This move has helped in boosting the profits and lift share prices of the industry. The four biggest tyre companies in Europe have already savored the goodness of this mandatory by the EU.
Michelin is among those who have profits and shares lifted due to this, with 44% increase of gains while Continental, has done way better with 66%. (PRA)