Japanese tyre manufacturer, Yokohama has resumed operations in Haryana at its Bahadurgarh factory. The company will follow requisite guidelines to avoid any COVID-19 cases at the factory.
Production will be scheduled in phases. With this, demand for zinc oxide in the region is likely to increase, in turn giving zinc dross trades a push. The long term sluggishness for dross demand could end with the tyre and paint companies slowly ramping up production. Auto sales rose in May from near zero in April. This slight uptick in demand for auto products and auto components could pave the way for better upstream demand. Especially since major car manufacturing companies have resumed operations.
Yokohama’s dealerships have opened at places where the government has lifted strict restrictions. Yokohama is a supplier for global car manufacturers including Mercedes, Honda, Suzuki, Porsche, Mitsubishi and Toyota.
The company’s tyre segment reported a decline in sales revenue and profits in the quarter ending March as sales declined but production cost increased. Demand for tyres in Japan fell amid COVID-19 outbreak in March followed by suspension of operations at vehicle plants in Japan and overseas markets. Sales from tyres segment fell by 12pc to JPY87,410mn ($801.62mn).
($1=JPY109.04)