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WASHINGTON, D.C. , November 30, 2006 – Tire shipments are estimated to decrease by 4.5 percent in 2006, according to the Rubber Manufacturers Association.
The decrease in tire shipments reflects the overall slowdown in the U.S. economy during 2006. Factors cited for this slowdown include shrinking GDP during the calendar year, higher energy costs, and a declining housing market.
However, RMA projects a modest rebound in 2007 with the total tire shipments expected to increase by nearly 4 million units to 310 million units, or approximately 1.4 percent. Overall, the combined original equipment and replacement shipments for 2006 auto and truck categories are anticipated to decrease by 14.4 million units to nearly 306 million units.
RMA’s Tire Market Analysis Committee forecast for key categories and their respective segments for 2006 through 2011 include:
- Original Equipment Passenger Tires: This market is projected to decrease by more than 8 percent, or 4.6 million units, to approximately 48 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 around the 48 million unit level.
- Original Equipment Light Truck Tires: Approximately 5 million units are projected to be shipped in 2006 to be followed by a 4 percent, or 200,000 unit increase in 2007. The increase is owed to the demand for small commercial trucks over the next year. 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: Approximately 6.8 million OE units are estimated to be shipped in 2006 for an increase of nearly 9 percent, or 560,000 units. This increase can be attributed to the significant growth of sales of commercial truck vehicles over the calendar year as a result of continued vehicle replacement demand and response to changes in 2007 EPA emission regulations. A sharp decline of approximately 20 percent, or approximately 1.5 million units, is anticipated in 2007 to 5.4 million units given that 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 3.2 percent in 2006 to nearly 196 million units, or 6.5 million units. Nonetheless, the P-metric (for SUV type vehicles) and Ultra High Performance tire markets are projected to increase by approximately 4 percent and 12 percent, respectively, compared to 2005. A modest rebound of over 2 percent, or approximately 4 million units, is forecasted in 2007 as the affects of higher energy prices wane. As a result, total passenger replacement shipments are anticipated to reach 200 million units again.
- Replacement Light Truck Tire: This market segment is projected to decrease by approximately 7.2 percent, or nearly 2.6 million units, to 33.4 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, or 300,000 units, to 17.2 million units in 2006. However, shipments will increase by the nearly the same number of units in 2007 to reach 17.5 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.