KARACHI, Oct 18 (Focus Pakistan) - Service Long March Tyres (SLM) wants to push Chinese truck tyres to the edge of Pakistan’s market, and a looming rise in import duty could give it the opening.
Management told analysts at the company’s FY26 briefing that it expects duty on imported truck tyres to rise to 27% from 16%. The company says it has secured approval and expects the government to issue the notification within a week, with implementation over the next two months.
SLM, which runs Pakistan’s first all-steel radial truck and bus tyre plant at Nooriabad, puts its market share at around 62%. Chinese brands hold most of the rest. Management wants to lift SLM’s share to 70%-75% in the near term and expects Chinese tyres to settle at 20%-25%. It described competition from smuggled tyres as limited.
RUBBER BITES
The tariff help would arrive as raw material costs climb. SLM imports around 95% of its raw materials, and natural rubber makes up about 90% of the rubber it uses.
Natural rubber has hit $2,616 a ton, its highest in 13 years, management said. Carbon black, another key input, costs $1,850 a ton, a 24-month high.
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The company has raised tyre prices by about 5% and may raise them again within 30 to 60 days, depending on input costs and how buyers react. Management expects margins to come under pressure in the second and third quarters of FY27. It said gradual price pass-through and existing inventory should soften the blow.
Supply lines have held up despite regional conflict. Management said exports and raw material shipments continue without interruption since key shipping routes reopened.
EGYPT ON THE MAP
Exports earned SLM 18.5 billion rupees in FY26, about a quarter of its 71.7 billion rupees in revenue, and accounted for 36% of tyre volumes. The United States and Brazil remain its main buyers.
Management now expects Egypt to become SLM’s third-largest export market, with potential sales of $7 million to $10 million over the next 12 months.
SLM also plans to cut its power costs. The plant draws an average of 12-13 megawatts and peaks at about 20 MW. The company plans to commission a 7.5 MW wind project in December 2026, which management says will lift renewables to 40% of its electricity mix from 23%. More wind capacity could follow.
Steam is a separate matter. The plant now raises it with gas and coal, and a biomass boiler due in June 2027 will reduce its reliance on gas.
CAR TYRE RACE
The bigger bet lies in passenger car radials. SLM plans to invest 22.56 billion rupees in a car-tyre plant and aims to commission it in January 2028.
Rivals will be waiting. Management named Armstrong among new local players. In an April rating note, PACRA said Armstrong’s Karachi-area plant will start at 1.8 million tyres a year and reach 4.3 million at full capacity. SLM also plans to develop tyres for electric vehicles as that market grows.
Growth among carmakers looks harder. Original-equipment sales make up only 1%-2% of the truck-tyre market. Management said General Tyre holds an edge there through established relationships and sister-company offerings.
SLM earned 13.5 billion rupees in FY26, up 35%, and paid a final dividend of 0.83 rupees a share. Management signalled a payout of around 40% of after-tax profit, with dividends considered annually.
The duty notification is the next thing to watch. If it arrives on schedule, SLM gets a shield against Chinese imports just as rubber prices test its margins.
