Dunlop Nigeria Plc, the only surviving tyre manufacturing company in Nigeria, has announced that it is scaling down local tyre manufacturing operations due to the harsh business environment in the country.

According to a statement from the company, the reversal of Government Policy on tariff for imported truck/bus tyres from 40 percent to 10 percent at the beginning of 2007 created unfair and inequitable advantages for importers of finished tyres. This decision, the company bemoaned, frustrated its recent N8 billion expansion into the Heavy Truck Radial segment.

Apart from this, the company also decried that the dichotomy between tariff for Car tyres, which is 50 percent and Truck/Bus tyres, which is 10 percent, is also being abused by importers of finished tyres, both in terms of tariff and haulage evasion.

"Additionally, the evident decay of local manufacturing infrastructure, particularly the epileptic power & gas supply situation, imposes add-on cost amounting to about 40 percent, which puts locally-produced tyres at a disadvantage.

The whole situation certainly confers undue advantages on importation rather than local manufacturing, which does not augur well for the interest of our great Nation, and we have been drawing attention of Government to this uneconomic reality in the last 18 months, without success.

Thus, we are forced to scale down local tyre manufacturing operations due to the very harsh business environment," the company lamented.

Meanwhile, the company said it has embarked on a strategic business redirection in order to restore its shareholders value. It disclosed that its Rubber plantation business is continuing and performing satisfactorily, and it is being further expanded. "We are equally harnessing available opportunities for growth in other sectors of the economy," the company assured its shareholders.