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BUILDING UP AND OUT

supply chain speed bumps added up to high prices and a lot of uncertainty.

Dealers restocked — and maybe even over-stocked — and the market slowed down (during) the second half of the year.

Despite the challenges and some stressful periods, it was great to see the economy moving again and to dodge the major downturn that some economists had predicted.

If there’s one thing we’ve learned over the past three years, it’s that there is no such thing as a predictable market or normal conditions anymore. The new normal is a constant state of change, probably not as huge rises and falls, but more like choppy waves, coming at us

CHAN PHOTHISANE, OTR national sales director, ZC Rubber America Inc.: Highway construction, infrastructure and new residential construction were on fire. OTR tire demand was strong.

MTD: Which OTR tire segment mining or construction has the potential for the most growth during 2023 and why?

HOLUB (BKT): Both segments have a reason to be optimistic in 2023. Although the coal industry is threatened long-term by being replaced with hydrogen, solar and windmills, it is still an important energy source, especially in Asia.

China still derives half of (its) energy there is expected to be 5% growth in construction. Infrastructure projects should start to take off, but with high inflation expected to continue, smaller residential and commercial ventures are expected to drop. Increased government debt is crowding out private capital investments. Overall, mining expects to have the most growth.

SEIBERT (Bridgestone): While 2022 was a dynamic year, the construction and quarry industries have been robust and we expect strong industry fundamentals to continue into 2023.

Industry measurements indicate growth in public construction and a recovery in private non-residential construction in the coming months. Signs point to growth in non-residential project planning and expectations for sales, profit, and staffing remain high for 2023. One of our key objectives in the coming year is to partner with our dealers to capitalize on this growth as a business.

We continue to see a slowdown in residential construction, primarily due to higher interest rates. Residential invest- ment has declined for six straight months. Although we are seeing a slowdown in investment, 2022 ended with spending increased over prior year and it remains at historically high levels due to an underbuilt housing situation in the U.S.

CRESTA (CMA): While we are seeing increases across both segments, we are expecting the effects of the 2021 Infrastructure Investment and Jobs Act to continue bolster growth in the construction OTR tire segment.

FUTRELLE (Continental): We believe there will be overall growth in each of these segments and it will be an opportunity for our industry. Even if the economy slows, many construction projects have already been kicked off and funded by the various programs approved previously. In the mining segment, there is a still a lot of backlog to catch up to in the year 2023 and this business seems to remain strong.

RAVASIO (Goodyear): Let me start by saying that both the mining and construction businesses have potential and are poised for an impactful year in 2023. Based on the market trends we see impacting the OTR business, we anticipate that the mining industry has the bigger potential for growth. The need for more mineral resources globally means that the mining industry should see more opportunity for consistent growth in the year ahead.

MCDONNELL (Maxam): The construction segment — with the investments in infrastructure and contracts being awarded. We have spent the past year growing our construction segment and its solutions to keep up with the increased demands in infrastructure.

SMITH (Michelin): Fixed site and mobile site construction has the most potential for growth in 2023. With the U.S. Congress recently passing the infrastructure bill, there is plenty of fuel to push growth in this segment. We will see non-residential growth increase significantly, as it has already begun across all of the U.S.

REYNOLDS (Triangle): I think it’s pretty clear that the construction segment has the most room for growth potential in 2023.

After seeing some growth for coal in both 2021 and 2022, most experts expect that market to take an 8% to 9% decrease in 2023.

Many minerals, such as copper and iron ore, are expected to hold steady or even increase somewhat in production, but most are expected to decrease in value. I don’t think the mining market will be soft, but there really aren’t any indicators for significant growth in 2023.

Construction, on the other hand, should see an increase due the infrastructure bill. It’s true that inflation has weakened the impact of funding and that in part was responsible for the slow construction starts in 2022.

There are signs, however, that as supply chains improve, prices for many construction materials are leveling off. If the infrastructure bill had not been passed and that funding was not in place for localities, the impact of inflation would have been far worse on construction projects.

I expect to see a steady mining segment and a healthy construction segment despite what is almost certainly going to be a struggling economy in 2023.

BESANCON (Yokohama): Mining is a stable platform for tire sales. In general, mining doesn’t experience big swings and I believe it’s on a steady, positive trajectory right now.

The bigger opportunity for growth in 2023 is in construction tires. The huge federal commitment to rebuild and maintain infrastructure will put a lot of people and machines to work.

Much of that work is going to be in the construction industry’s version of what transportation experts would call “the last mile.” Let’s call it “the last brick.” Billions of dollars’ worth of projects are going to be (devoted to) maintenance and improvement — not the massive earthmoving that marks projects starting from scratch, but digging, demolition, building and paving with smaller machines that can operate between buildings or on existing roads. That means a significant demand for tires in the 25-inch rim size and under.

Those smaller machines are also getting more efficient than ever, carrying more loads — and, often, heavier ones — per production hour. That represents more demand than ever on tires.

Today’s tire dealer needs to be ready and able to help construction customers select the right tire for the job and condi-