Tire shipments are projected to drop by about 16 percent this year, mainly as a result of a nearly 45 percent decline in OEM passenger car tires and an almost 43 percent drop in OEM commercial truck tires, according to the Rubber Manufacturers Association (RMA).
Total 2009 tire shipments are projected to decline some 45 million units to 237 million units. This level is about 84 million units less than the peak of 321 million units in 2000. The decrease in tire shipments reflects the recent struggles of automotive manufacturers, low consumer confidence, high unemployment and depressed home values, the RMA says.
Vehicle miles traveled seem to have stabilized and domestic economic conditions for both the consumer and commercial sectors appear to have bottomed and are poised for a rebound in 2010. The tire industry is expected to realize a nearly 8 percent growth in 2010 reaching the 260 million unit level.
The RMA’s Tire Market Analysis Committee forecast for key categories and their respective segments includes:
• Original Equipment Passenger Car Tires: Large decreases in domestic vehicle production as a result of auto manufacturer production shutdowns and bankruptcy reorganizations will result in a nearly 46 percent decrease in 2009 shipments to about 21 million units. With the economy predicted to emerge from the recession in 2010, a rebound in vehicle sales and subsequent vehicle production is anticipated, which will result in a nearly 11 million increase in OE tire shipments in 2010. The projection does not account for any changes to the auto industry as a result of further federal intervention or consumer incentive programs.
• Original Equipment Light Truck Tires: This category will experience an approximate 12 percent decrease, or 400,000 units, in 2009 to nearly 2.6 million units due to slower economic conditions and its impact on the commercial sectors, which utilize light truck vehicles. There is continued consumer demand for vehicle fitments with P-Metric passenger car tires in place of light truck tires, and as the economy gradually recovers in 2010, a nearly 100,000 unit gain is anticipated.
• Original Equipment Medium/Wide-Base/Heavy On-Highway Commercial Truck Tires: Given the downward revisions in the economic conditions in the commercial sector, a nearly 44 percent decline to about 2.2 million units is anticipated for 2009 – a decrease of more than 1.6 million units. The economic rebound anticipated for 2010 along with pent up demand for vehicles is projected to result in a net gain of about 500,000 units increase in shipments.
• Replacement Passenger Car Tires: As a result of the protracted economic downturn and the onset of economic recovery pushed closer to 2010, the market will realize another decrease of nearly 9 percent, or about 18 million units, reaching a level of 176 million units. Growth is anticipated to resume in 2010 with the replacement sector estimated to increase by about 5 million units, or slightly better than 3 percent, in tandem with the projected economic growth in the consumer sector.
• Replacement Light Truck Tires: Although the number of vehicles for this market remains steady and largely represented by small commercial vehicles, further declines in economic conditions is forecasted to contribute to a nearly 18 percent decline in replacement light truck tire shipments in 2009 to the 24 million unit level. An increase of nearly 8 percent is anticipated in 2010 in keeping with commercial economic forecasts.
• Replacement Medium/Wide-Base/Heavy On-Highway Commercial Truck Tires: The market will realize another decrease of more than 3 million units in 2009 to about 12 million units as a result of the protracted recovery. Given the uneven economic rebound forecast for 2010, this market is expected to increase by less than 1 million units to nearly 13 million units.
For more information, visit www.rma.org.
