Facts section: introduction
A $32.1 billion industry! Replacement tire sales set a record in the U.S. By Bob Ulrich
costs — are there any other kind? — will force tire manufacturers to announce multiple price increases. Passing them along wo years ago, domestic replacement tire sales broke the to the consumer is another matter. $30 billion mark for the first time, finishing at $30.1 But take heart: On Sept. 26, those once mighty tariffs on billion. Last year, sales dropped more than $3 billion Chinese consumer tire imports will drop another five perto $26.8 billion as the recession took its toll. centage points, to 29%. When they were first implemented The roller-coaster ride continued in 2010, with pent-up on Sept. 26, 2009, they added 35% to the existing 4% duty on demand and double-digit price increases resulting in record consumer tires. The world didn’t end then, and when the tariff (hopefully) goes back to 4% on the same day in 2012, you will replacement tire sales of $32.1 billion (see Chart 1). Dr. Ken Mayland, president of ClearView Economics LLC, be able to conduct business as usual, with additional low-cost tire options to boot! predicted the turnaround. MTD’s 45th annual Facts Issue not only ana“I wouldn’t say (the tire industry) Chart 1 is bullet-proof, but people are holding lyzes what happened in our industry in 2010, 2010 U.S. REPLACEMENT onto their cars longer... eventually, they but also offers some insight into what you can TIRE SALES expect to see in 2011. We hope it will help you are going to need maintenance.” (a $32.1 billion industry) run your businesses more profitably. ■ Consumer tires, defined as passenger Passenger $ 21.8 billion and light truck tires, represented 81% of tires: total sales, or $26.1 billion. Both passenAll figures in the 14-page Facts Section are Modern Light truck $ 4.3 billion ger ($21.8 billion) and light truck ($4.3 Tire Dealer figures unless otherwise noted. tires: billion) tire sales also set records. Truck tires: $ 5.1 billion Overall tire shipments are expected Farm tires: $502 million to rise again in 2011. So are tire prices, OTR tires $401 million as the need to meet rising raw material
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E IN MAD NA CHI
Clockwise from upper left: Sam’s Club is the largest warehouse membership club in the U.S. with more than 600 stores; replacement truck tire shipments rose nearly 20% last year; natural rubber costs reached $5,000 a ton on Jan. 1, 2011; there was a dramatic decrease in consumer tire imports made in China; Tire Kingdom Inc. is the second largest independent tire dealer chain in North America with 735 stores (Discount Tire Co. Inc. ended the year with almost 800); ATD has 86 distribution centers; Chairman and CEO Mauro Pessi says Pirell Tire North America “is not interested in bringing truck tires here.”
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MTD January 2011 4/26/11 11:04:25 AM
