1.7% Increase Predicted in 2006 Tread Rubber Shipments

For more information contact:
Dan Zielinski
(202) 682-4846
dzielinski@rma.org

WASHINGTON, D.C. August 30, 2006 - Continued economic growth will fuel a steady increase of 1.7 percent in U.S. tread rubber shipments through 2006, approximating 2005’s 1.9 percent growth, according to the Rubber Manufacturers Association’s Tread Rubber Market Analysis Committee (TRMAC).

The 2006 forecast will mark the fourth consecutive year that shipments will increase, and represents a total of approximately 16.35 million retreaded tires in the United States.

Retreaded tires are used by commercial aviation, commercial trucks, school buses, and off-the-road vehicles such as industrial, agricultural and mining equipment.

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The Rubber Manufacturers Association is the national trade association for the rubber products industry. Its members include more than 100 companies that manufacture various rubber products, including tires, hoses, belts, seals, molded goods, and other finished rubber products. RMA members employ over 120,000 workers and account for more than $21 billion in annual sales.

Tire Shipments Forecasted to Decrease in 2006

For more information contact:
Dan Zielinski
(202) 682-4846
dzielinski@rma.org

WASHINGTON, D.C.August 4, 2006 - Tire shipments for 2006 are expected to decrease by 2.8 percent compared to 2005, according to the Rubber Manufacturers Association.

The decrease in 2006 tire shipments reflects the overall slowdown in the U.S. economy. While GDP growth was a healthy 5.6 percent in the first quarter, second quarter growth slowed substantially to 2.5 percent. Slower growth and higher energy costs appear to be forcing consumers to prioritize spending including postponing tire replacement.

However, RMA projects growth to resume in 2007 with the total tire shipments expected to increase by nearly 7 million units to 319 million units, or approximately 2.3 percent. The committee believes that the number of vehicles and miles driven annually are expected to continue to increase once fuel prices stabilize as predicted.

Overall, the combined original equipment and replacement shipments for 2006 auto and truck categories are anticipated to decrease by 8.9 million units to nearly 312 million units compared to 320.8 million total shipments in 2005.

RMA’s Tire Market Analysis Committee forecast for key categories and their respective segments for 2006 include:

  • Original Equipment Passenger Tires: This market is projected to decrease by more than 2 percent to approximately 51 million units in 2006 as a result of a decrease in domestic light vehicle sales and subsequent decreases in domestic light vehicle production. No growth is expected in 2007 with total shipments remaining at the 51 million unit level.
  • Original Equipment Light Truck Tires: Approximately 5.6 million units are projected to be shipped in 2006. However, a 5.6 percent, or 300,000 unit increase in 2007 is forecast as demand for small commercial trucks will remain strong. Note that there has been a change in reporting this category beginning in 2006 as Service Trailer tires are no longer included in this category. As such figures for previous years are not comparable.
  • Original Equipment Medium/Wide-Base/Heavy On-Highway Commercial Truck Tires: Sales of commercial truck vehicles will experience modest growth in 2006 due to continued vehicle replacement demand and response to future changes in EPA emission regulations. As a result 6.6 million OE units are forecasted to be shipped in 2006, or an increase of 5.7 percent. A sharp decline of approximately 16 percent is anticipated in 2007 to 5.5 million units as some pulled-ahead truck sales that would have been realized in 2007 are being shifted to 2006. Note that there has been a change in reporting this category beginning in 2006 as Heavy On-Highway truck tires are now included to obtain a more accurate portrayal of the commercial tire market.
  • Replacement Passenger Tire: The passenger replacement market will decrease by approximately 2.3 percent to nearly 198 million units for 2006 representing a decline of 4.6 million units over 2005’s shipments. Still, the P-metric (for SUV type vehicles) and Ultra High Performance tire markets are projected to increase more than 5 percent and 12 percent, respectively, compared to 2005. The market is forecast to rebound in 2007 by approximately 7 million units to nearly 205 million units as consumers will need to eventually replace tires. Overall, growth in the replacement market is primarily a result of the number of vehicles on the road and vehicle miles traveled.
  • Replacement Light Truck Tire: This market segment is projected to decrease by approximately 7.6 percent to 33.3 million units in 2006 due to the increasing popularity and numbers of cross-over vehicles and smaller SUVs that use P-metric passenger tires rather than light truck tires.
  • Replacement Medium/Wide-Base/Heavy On-Highway Commercial Truck Tires: This market is projected to decrease by approximately 2 percent to 17.2 million units in 2006. However an increase of approximately 400,000 units is forecasted in 2007 to 17.6 million units. Note that there has been a change in reporting this category beginning in 2006 as Heavy On-Highway truck tires are now included in order to obtain a more accurate portrayal of the commercial tire market.

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The Rubber Manufacturers Association is the national trade association for the rubber products industry. Its members include more than 100 companies that manufacture various rubber products, including tires, hoses, belts, seals, molded goods, and other finished rubber products. RMA members employ over 120,000 workers and account for more than $21 billion in annual sales.