Tariffs and Indian competition threaten Italian supremacy

On the one hand, the tariffs wanted by the US Trump administration, added to the devaluation of the dollar. On the other, the hidden levy imposed by the Ets (Emission Trading System), which weighs in at a further 15 per cent. In the background, a scenario characterised by the advancement of Indian producers, who can act on the price lever ($7 per square metre compared to over 17 for Italian tiles) thanks to low production costs and who in Europe have increased sales by 235% since 2018. The Italian ceramic industry remains first in the world. A supremacy in terms of sustainability, technological innovation and design that last year, with 248 companies employing a total of almost 26 thousand people, including tiles, sanitary ceramics, tableware, refractory materials and brick companies (sales of the latter are, however, limited to the Italian market alone), brought it to a total turnover of almost 7.6 billion, with tiles alone at 6 billion. Yet there are many critical points.

Last July's agreement between the US and the European Union ended the phase of uncertainty - the great enemy of companies - that had held back or even immobilised importers. "But with tariffs at 15%, a few percentage points higher than the previous ones that ranged between 8 and 10%, it is clear that we are being penalised," says Vittorio Borelli, vice-president of Confindustria Ceramica. "For our companies, which operate in a premium segment compared to other European countries, the tariffs have a greater impact. For example, with a surcharge of 1.2 euro per square metre for the product transported to the customer's home compared to Spanish products. If we add the unfavourable exchange rate with the dollar, we come out with our bones a bit broken. Now we have certainties but we risk a loss of competitiveness'.

Factors to which the increasingly fierce competition from the Indian industry must be added. Because while it is true that the 50% tariffs imposed by Donald Trump on India (but also on Malaysia and Vietnam) may free up market shares in the United States, there is also the risk that Asian producers will seek outlets in Europe, which, according to Borelli, "does not have sufficient defence instruments". A question of anti-dumping strategies and actions. If those established by Brussels to counter the Chinese advance have been effective, the same cannot be said of the measures launched to curb India's race.

"We can have anti-dumping tariffs but they do not even reach 10%, a measure that does not slow down imports of Indian product into Europe," Borelli notes. Added to all this is the weight of the European Ets system which, Borelli continues, "without solving the environmental problem, takes away our resources to invest more in more sustainable production, with the risk of relocations and production concentrations in non-EU countries and the consequent weakening of European industry".

The anomaly of Indian competition is now there for all to see. "Their sales prices correspond to the costs that we incur for energy supply and raw materials," explains Graziano Verdi, vice-president of Confindustria Ceramica and president of Cet, the association that brings together European ceramic industrialists. "We are the world champions of sustainability and we compete with industries that produce with coal-fired kilns and have very poor legislation on the protection of workers' rights. The absence, then, of the obligation to indicate the origin of goods nullifies the value of made-in-Italy production, which is often confused by unfair Italian sounds. All aggravated by the Ets system, which should be cancelled'.