Tire Recycling Revenue Streams: Gate Fees, Material Sales, and Services

Updated on: 8th March 2026 By:

Kieran Donnelly
Expert review by:

A tire recycling business can generate revenue from multiple sources simultaneously, and the mix of revenue streams determines both the total margin and the stability of the business. Operations that depend on a single revenue stream are more exposed to market changes than those with three or four income sources from the same processing activity. Understanding the full range of revenue options before you start, and building a business model that captures as many as are viable for your scale, is one of the most important strategic decisions in setting up a tire recycling operation.

Gate Fees: The Primary Revenue Driver

Gate fees are charged to tire producers (garages, tire dealers, fleet operators, car dealerships) for accepting their end-of-life tires. This is the primary revenue stream for most tire recycling businesses because it generates cash at the point of collection and requires no downstream market risk: you earn the fee regardless of what happens to the tire after processing.

Gate fee rates in the UK vary by tire category. Car tires typically attract £0.80 to £2.00 per tire from trade sources, though retail-facing collection services charge higher rates. Van and light commercial tires earn slightly more per tire. Truck tires earn £2.00 to £8.00 per tire depending on size and local market rates. Agricultural and OTR tires earn £10 to £50 or more per tire for large formats, reflecting the higher processing complexity and lower volume of these categories.

The Gradeall MKII Tyre Baler processes up to 80 car tires per hour. At a modest gate fee of £1.20 per car tire, an operation running at 60 tires per hour for 6 hours generates £432 per day in gate fee revenue from car tires alone. That figure scales with throughput and rate.

Tire Category	Typical Gate Fee (UK)	Processing Equipment	Revenue per Hour (est.)
Car (R13-R18)	£0.80 – £2.00	MKII Tyre Baler	£48 – £160 at 80 tires/hr
Van / light commercial	£1.50 – £3.00	MKII Tyre Baler	£90 – £180 at 60 tires/hr
Truck (R22.5)	£2.00 – £8.00	Truck Tyre Sidewall Cutter + Baler	£40 – £160 at 20 tires/hr
Agricultural (small-mid)	£5.00 – £20.00	Agricultural Tyre Shear	Variable
OTR (large)	£20.00 – £80.00+	OTR Sidewall Cutter + Splitter	Variable, project-based

Bale Sales: Turning Output into a Second Revenue Stream

Baled tires can be sold to downstream buyers who use them in civil engineering (PAS 108 applications), energy recovery (cement kilns and industrial furnaces), or further processing (crumb rubber and TDF production). The price per bale or per tonne of baled tires varies with market conditions, downstream demand, and bale specification.

PAS 108-compliant bales for civil engineering applications represent the highest-value bale market in the UK. These bales need to meet the specification set out in the British standard for tire bales in construction, which covers dimensions, density, and construction requirements. Gradeall MKII Tyre Balers are designed to produce PAS 108-compliant bales, supporting access to this market.

Energy recovery buyers (cement kilns) typically buy bales at a lower per-tonne rate than civil engineering buyers but represent a larger and more consistent market. This makes energy recovery a reliable outlet for bale volume that exceeds the civil engineering demand in your area.

Service Contracts: Recurring Revenue from Fixed Customers

Service contracts with tire producers provide predictable recurring revenue rather than variable collection volumes. A service contract with a fleet operator or garage group commits the customer to a defined collection schedule and volume range in exchange for an agreed gate fee rate. For the tire recycler, this creates a more predictable revenue base and reduces the time and cost of customer acquisition per collection.

“The businesses with the best cash flow stability in tire recycling are those with a strong base of service contracts,” says Conor Murphy, Director of Gradeall International. “Spot collections fill capacity, but contracted customers give you the revenue visibility to plan equipment maintenance, staffing, and capital investment with confidence.”

Additional Revenue Opportunities

Some tire recycling operations generate additional revenue from related services. Tire rim separation, where steel rims are separated from the tire carcass before baling, allows the steel to be sold to metal recyclers as a separate income stream. Rim separation equipment such as the Gradeall tire rim separator can be incorporated into a processing line where rim quantities justify it.

Operators processing truck tires can separate rims using the Gradeall Truck Tyre Rim Separator and the standard tire rim separator, generating steel scrap revenue alongside the standard tire processing revenue. At scale, this additional stream is meaningful.

FAQs

What gate fee rates should I charge when starting a tire recycling business?

Start by researching the rates charged by existing operators in your target area. Pricing below market rates to win initial customers is a common and effective approach, but avoid pricing so low that the business is not viable at the volumes you actually achieve in early months. As throughput builds and you develop a reputation, rates can be adjusted upward. For a new operation, starting 10 to 15% below the local market rate for the first 6 months is a reasonable positioning strategy.

Is there a market for baled tires internationally?

Yes. Export markets for tire bales exist in countries where domestic tire recycling infrastructure is less developed. Gradeall has supplied equipment to tire recycling operators in over 100 countries, and the export market for baled tires is an established part of the global tire recycling supply chain. Export economics depend on shipping costs, destination market gate fee and bale price equivalents, and regulatory requirements in the destination country. The export market for tire bales is covered in more detail in our dedicated article on selling baled tires internationally.

How do I find buyers for my tire bales?

Buyers for tire bales include civil engineering contractors and highway infrastructure suppliers (for PAS 108 bales), cement manufacturers and large industrial fuel users (for energy recovery), and crumb rubber processors and TDF producers (for further processing). Industry trade associations including the British Tyre Manufacturers’ Association and the UK Tyre Manufacturers Association can provide market contacts. Waste sector trade shows and publications are also effective networking routes.

Can I generate revenue from OTR and agricultural tires at the same site as car tires?

Yes, but OTR and agricultural tires require different equipment and a different processing approach. Car tire balers cannot handle OTR categories. Separate processing equipment is needed, and the cost of that equipment needs to be justified by the volume and gate fee revenue from the larger tire categories. For most car tire baling operations, occasional large-tire processing is managed by subcontracting to a specialist OTR processor rather than investing in dedicated OTR equipment until volumes are large enough to justify it.

How stable are gate fee rates over time?

Gate fee rates fluctuate with market supply and demand dynamics. Rates tend to fall when new processing capacity enters a local market, increasing competition for tire arisings. Rates tend to rise when processing capacity is tight, which drives up the cost to tire producers who have fewer options. Over a 5 to 10 year horizon, gate fees have generally been stable to modestly increasing in UK markets, but local conditions vary significantly. Building customer relationships and service quality that justifies a rate premium provides some insulation from downward rate pressure.