2 Tyre sector
2.1 Tyre life cycle in New Zealand
The product life cycle of a tyre in New Zealand is presented in the figure below.
Figure 2-1: Product life cycle of a tyre in New Zealand
View figure at full size (including text description).
Production and importation
The manufacturing and importing section of the tyre industry in New Zealand comprises:
- two domestic manufacturers (Bridgestone and South Pacific Tyres);
- a range of tyre importers - bringing in both new and used tyres;
- used and new vehicle importers - who bring "fixed" tyres (attached to vehicles) into the country.
Types of tyres
There are a raft of different tyre "types", including passenger, truck (light and heavy), bus, motor cycle, and specialised tyres (for example, off-road heavy haulage vehicles, aircraft tyres). There is also significant variation within any one group. For example, passenger tyres vary with respect to aspect ratio, rim, diameter, tread width, tread pattern, composition, construction and tyre performance. For the purposes of this study we are using the term "tyre" in a generic sense - primarily to refer to passenger tyres that weigh approximately 9.5 kg each. (Please note for comparative purposes an average truck tyre weighs approximately 47.5 kg). Also note that in New Zealand the total tyre numbers are approximately 75% car and 25% truck/commercial tyres. By mass, the figures are approximately 54% for cars and 46% for truck/commercial tyres.
Numbers
There are three to four million tyres disposed of, in some way, in New Zealand every year (this is a general estimate based on TyreTrack numbers and research in other developed countries). We have not been able to compile any definitive data on the number of tyres entering the market nor being disposed of. As an approximation, the number of tyres entering the market would be slightly higher than the number of tyres being disposed of, to take account of the increasing number of cars on the road. For the purposes of this study, we have assumed that approximately four million tyres enter the New Zealand market annually. There is an anecdotal assumption that one Equivalent Passenger Unit (EPU), or typical passenger tyre, is disposed of per person per year. Our study in Australia (URS Australia 2005) showed that this assumption was low - on account of the number of large earthmoving tyres - and a more accurate assumption may be in the order of 1.5 EPUs per person per year. If this is the case, there may be more tyres being disposed of in New Zealand than assumed in this report.
Tyres sourcing
There are three main ways in which tyres can enter the market.
- New Zealand production of new tyres - there are two producers, Bridgestone and South Pacific Tyres, who own a similar share of the market.
- Import of tyres - the large importers include Tyres 4 U (new tyres), Value Tyres (used tyres) and Imex (both types). The rest of the market is very fragmented, with small importers including Blairs, TRS, Specialty Tyres, and Fielding Tyres. There are 30 or more importers of new tyres into New Zealand. The majority of tyres imported into New Zealand are new.
- Tyres imported as part of vehicles - approximately 100,000 new and 200,000 used cars are imported into New Zealand annually. Both used and new tyres enter the New Zealand market this way.
Based on a total figure of four million tyres, the breakdown of tyre sources in New Zealand is estimated as follows:
- New Zealand produced new - 1 million (approximately 500,000 from Bridgestone and 500,000 from South Pacific Tyres);
- imported loose - 1.2 to 1.4 million new and 600,000 used;
- imported on new and used cars - 1.2 million.
Passenger and light track tyres are produced in New Zealand for the local and export markets. Heavy and specialty tyres are all imported.
The average price of a new passenger tyre in New Zealand is between $50 and $200. The average price for a used passenger tyre is between $30 and $100. (Note, these prices have been relatively stable over the last few years but, depending on the value of the New Zealand dollar, imported tyre prices could start to increase as crude oil prices increase.)
As the number of passenger vehicles on New Zealand roads is increasing annually, it is safe to assume that the EoL tyre numbers are also increasing.
Distribution
It is currently estimated that there are between 600 and 900 tyre retailers in New Zealand. A review of the retailers registered in the Telecom yellow pages indicates there are close to 650 retailers in the North Island and 200 in the South Island. Approximately 300 are owned or franchised by the tyre producers and include Firestone, Beaurepaires, Goodyear and Frank Allen. There is an overall trend for consolidation of smaller retailers under the auspices of the two main manufacturers - Bridgestone and South Pacific Tyres.
The remainder of the 300 to 600 retailers (over 50% of the market) is very fragmented, with individual shops or small chains like Tony's Tyres (approximately 20 stores). Auckland research quoted by South Pacific Tyres indicates there are also a large number (2,000 for Auckland region) of individual garages that occasionally sell tyres and are able to change them. Individual customers are not likely to be changing their own tyres due to the technical difficulty.
Use
The majority of the customers dispose of their tyres at the point of sale, when they buy the replacement tyres. There is a wide range of prices charged for disposal of tyres from $1 to $5. Some retailers don't charge or don't highlight the disposal charge in order to retain price sensitive customers.
There has been an overall trend for tyres to last longer and for "retreading" of tyres to become less common. Labour costs for retreading are typically greater than the differential between the new and used product and it is, therefore, no longer economical to retread tyres.
Collection and processing
There are approximately 30 dedicated tyre collectors operating in New Zealand (at the time of writing this report), however, only half of them collect high volumes of tyres. It is estimated that 30% of the tyre disposal is conducted through these specialised collectors. Nine of the collectors also offer shredding services. J&J Laughton is the only collector who recovers steel and produces granulated rubber. Ninety-five percent of tyres disposed through the collectors are either shredded or quartered. The collectors require resource consents which specify, as a condition, that the tyres can only be stockpiled for up to two years.
Collection and transport of EoL tyres is also undertaken by general waste management companies. Large transportation companies (including Mainfreight and Toll), as well as small unregistered operators, take the tyres to landfills or transfer stations.
The current number of collectors was deemed insufficient by the interviewed representatives of the industry. Some collectors operate nationwide, moving their shredders between different locations as needed. The market pressures in the tyre collection industry are very high, with high competition and low margins. The number of collectors is currently on the decline. Additionally, due to a number of health and safety incidents, compliance costs are likely to rise.
There are dedicated collectors servicing most regions in New Zealand with the exception of Nelson, Hawkes Bay, Northland and Southland. Based on anecdotal information collected during this study, the collectors in these regions have gone out of business largely for economic reasons arising from the large distances and small numbers of tyres involved.
A number of councils (Waitakere, North Shore City and Rodney) have introduced a licensing system for tyre collectors. Under this system the collector is required to pay a $300 fee per year, provide a letter from a bank confirming viability of the business and provide quality, health and safety assurance documentation about the fleet and equipment. An additional $300 is charged if the collector also operates a shredder. Although the application of a licensing fee has been the subject of some debate in the sector, it does have the effect of "formalising" the reporting of tyre numbers and will therefore support TyreTrack objectives.
Disposal
Nearly four million tyres are disposed of in New Zealand every year. Of these, and on the basis of information collected by TyreTrack, 75% are sent to landfill. The remaining 25% are used for farm silage covers, speedways, playground and other alternatives or disposed of illegally.
There are less than 100 [MfE 2004. New Zealand Waste Strategy 2002 - Reviewing Progress and Moving Forward.] landfills in New Zealand and some service areas of more than 200 km in diameter. In those areas councils tend to operate transfer stations which accept tyres. Stricter landfill regulation increases the operational and construction costs, which must be carried by ratepayers or recovered in landfill fees. Some landfill closures are also due to compliance issues. There is no unified policy in regard to tyre acceptance, but an increasing number of landfills accept only shredded or quartered tyres.
Based on a review of tyre disposal practices in Australia (URS 2005), South Australia, Tasmania, Victoria, Western Australia and the Sydney metropolitan area landfills have all banned disposal of whole tyres. This is in response to problems with tyres creating void space, their ability to harbour insects and the potential for tyres to rise to the surface of the landfill. In these locations the tyres must be shredded.
In New Zealand, Waste Management operate a large proportion of our landfills and report that many of these will no longer accept whole tyres. Acceptance criteria vary from landfill to landfill and do not seem to be regulated by local council district scheme provisions or regulatory controls.
The fee for the landfill disposal ranges from $45 to $400 per tonne of tyres (45 cents to $4 per tyre), with higher prices in municipal areas and lower prices in rural areas. It is understood (based on anecdotal evidence from both Australia and New Zealand) that the landfill fee may also vary significantly depending on the landfill operator/collector relationship (in particular, the volume of tyres being supplied by the collector). It is also likely that landfill costs are influenced by whether or not the tyres are being used as liners or for alternative engineering purposes within the landfill.
Current alternative end-uses
Based on anecdotal evidence collected during this study, 10-15% of tyres (400,000-600,000 per annum) have a different end-use than disposal to landfill or illegal dumping.
A large proportion of these are used by farmers to cover silage pits. Disposal of tyres to farms is the cheapest method of disposal - the farmers usually pick up tyres and transport them to their farms. In some cases, the farmers pay in the order of $1 per tyre. [Anecdotal information supplied by Lindsay Halliday, Holcim New Zealand.] There are, however, questions in regards to final disposal of the farm tyres. It is possible that some are buried on the farms in the empty silage pits. Although the current farm disposal practices may be slightly preferable than illegal dumping, the tyres may eventually comprise an unregulated landfill on the farms. Over the long term, this practice contributes to the dispersion of waste tyres throughout the countryside.
Some analysts expect the farm demand will be reduced over time. [Firecone. 2004. Management of End-of-life Tyres.] There is some anecdotal evidence for a general shift towards advanced silage bailing technologies that don't use tyres - as the baled silage is drier than tyre-covered pit silage and therefore provides a better food source. This trend may have been offset over the past few years with the significant increase in dairy farming activity in New Zealand.
Other current end-uses diverting low quantities of tyres from New Zealand landfills include:
- arena surfacing;
- matting/toys;
- garden mulches;
- retaining walls;
- other engineering applications such as road surfacing (although there is very little at this point).
Unaccounted tyres
On the basis that approximately 75% of tyres are sent to landfill, then approximately 25% are either used on farms, speedways, playgrounds and for various civil engineering purposes, or are disposed of illegally. As a result of the research completed for this study, we have not been able to ascertain even an approximate figure for the tyres that are "dumped" illegally in New Zealand. We have heard anecdotal reports of farms with holes and gullies that will "receive" old tyres for a fee of approximately $1 per tyre, as opposed to the $2 to $3 landfill disposal fee. In addition, there is anecdotal information to support the use of a relatively large number of tyres as a structural drainage material for landfills. Despite being an effective end-use, this is a "one-off" function and the number of tyres used for this purpose will gradually decline as the demand is met.
TyreTrack administrators at the Motor Trade Association (MTA) report they receive regular calls from construction site owners and operators to advise that a load of tyres has been illegally dumped on their site. The only option for these individuals is to arrange, and pay, for the tyres to be collected and disposed of legally at a landfill. (In these cases, the tyres would then constitute part of the 75% going to landfill).
The prospect of approximately 300,000 tyres per year being illegally disposed of within New Zealand is alarming and should be investigated in further detail.
The issue of illegal tyre dumping has been previously analysed. [Firecone. 2004. Management of End-of-life Tyres.] The Firecone study reported an alarming number of incidents where a landowner has been left to pay for disposal of large numbers of tyres (up to $100,000 costs) dumped on their private property.
2.2 Tyre composition
The tyre composition impacts on potential end-uses and is, therefore, relevant to any evaluation of more effectively using EoL tyres as a resource. In general, manufacturers design and construct tyres to maximise their life. Tyre design is changing constantly in response to market demands relating to safety, economy, performance, unit costs, material availability and needs of the automobile industry (URS Australia 2005). In general, tyres are made up of synthetic or sometimes natural rubber, carbon black, steel wire, textile and various chemicals. Between approximately 75% to 80% of the weight of car and truck tyres is rubber. [Basel Convention Working Group 1999. "Basel Convention Technical Guidelines on the Identification and Management of Used Tyres. Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and Their Disposal, Document Number 10.] Approximately 1.5% by weight is made up of chemicals including copper compounds, zinc compounds, cadmium, lead, acidic solutions and organohalogens.
The carbon black and other chemicals are combined into the rubber during the manufacturing process and are difficult to separate out for reuse. In most cases EoL tyres are quartered or shredded (these are both mechanical processes involving cutting up the tyres).
2.3 New Zealand specific considerations
There are a number of New Zealand-specific aspects to the tyre sector and, in particular, to EoL tyres that are important considerations for future initiatives to promote environmentally responsible tyre disposal here. These aspects create a situation that is different to that in Europe, the United States and other developing countries and that has implications for the successful adoption of alternative tyre end-uses. They are briefly discussed as follows.
Dispersed used tyres
Both the generation and current storage of EoL tyres in New Zealand are highly dispersed. This creates a situation where the logistics of collecting large volumes of tyres - for potential alternative end-uses - may be prohibitive from a cost perspective. Many of the successful tyre reuse schemes overseas have been developed using large volumes of tyres available in single, central-city locations.
Regional private sector landfills
In New Zealand, as with many overseas developed countries, there is a trend towards large, highly "engineered" landfills (which will include extensive drainage controls and leachate collection systems) to service a large region. Smaller, rural non-engineered "dumps" or "tips" are being gradually replaced by these regional landfill facilities. Some of the larger, well-designed and operated landfills are now operated (and, in some cases, either partly or fully owned) by the private sector. Waste Management, for example, operates the large Redvale and Whitford landfills in Auckland and the Kate Valley landfill in Christchurch.
Tyres disposed of legally in a landfill are therefore not necessarily creating an unacceptable environmental impact. In this regard, landfill disposal could be viewed as "safe". In addition, a proportion of the tyres being sent to landfills are effectively being used as a liner for landfills and are, therefore, part of environmentally responsible landfill design practices. For purely disposal purposes, however, there is a space consideration as tyres do not degrade for extremely long periods of time.
