Couldn't the new Cooper's just raise prices on the tyres, until NTD doesn't make much money selling the tyres?
My understanding was that the old Cooper's couldn't raise prices on its tyres too much because it didn't have any AU operations. They needed an Australian partner to sell its products here, and if it charged too much for tyres, leaving no room for profit, then no one would sell its products.
This situation seems to change under Goodyear. Goodyear has full capability to sell tyres in Australia. They aren't dependent on third party distributors in order to sell tyres. So I guess my question is, is it not in Goodyear's interest to now jack up tyre prices until the excess profit margin from a third party like NTD selling Cooper's disappears? Wouldn't it make sense for Goodyear to capture more of the profit margin from selling Cooper's products, now that they aren't reliant on NTD to make Australian sales?
I don't know. I'm just not too convinced just yet on this whole "no impact until 2017 argument". Interested to hear others takes on this.
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