Original Equipment Passenger Tires Down To 1991 Levels
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WASHINGTON, D.C., August 4, 2008 – Tire shipments are projected to decline by nearly 4 percent this year compared to 2007, according to the Rubber Manufacturers Association.
The decline in tire shipments reflects the worsening domestic economic pressures predicted for both the consumer and commercial sectors. Overall, the combined OE and replacement tire shipments for 2008 light vehicle and truck categories are anticipated to decrease by more than 12 million units to approximately 298 million total shipments. Shipments totaled 310 million units in 2007.
RMA’s Tire Market Analysis Committee forecast for key categories and their respective segments for 2008 include:
- Original Equipment Passenger Tires: This category is projected to decrease by more than 11 percent to approximately 41 million units in 2008 as a result of continued decreases in domestic vehicle production. This will mark the lowest level of OE shipments since 1991 when OE shipments stood at 41.8 million units. A further decrease of approximately 3 percent is expected for 2009 owing to a protracted economic recovery and continued market share gains for light vehicle imports.
- Original Equipment Light Truck (LT) Tires: Due to the fundamental shift in consumer demand for vehicles with higher fuel economy, a shift in vehicle fitments to P-metric passenger tires and market share increases by import vehicle manufacturers, light truck vehicles fitted with LT tires will be significantly impacted. A decrease of more than 35 percent is projected for 2008 accounting for approximately 1.6 million fewer units shipped from the 4.4 million total OE units in 2007. For 2009, a modest 200,000 unit increase is anticipated owing to resumption of economic growth in the commercial sectors that utilize light truck vehicles.
- Original Equipment Medium/Wide-Base/Heavy On-Highway Commercial Truck Tires: For 2008, this category is projected to decrease by approximately 12 percent to nearly 4.1 million units. This decrease is attributed to the larger than anticipated economic slowdown in the commercial sector. However a considerable rebound of more than 24 percent is forecasted for 2009 as economic activity improves and truck sales increase. Anticipation of changes in EPA regulations for 2010 will inspire a pull-forward effect of truck sales into 2009.
- Replacement Passenger Tire: A slowing economy and high energy prices are factors in a reduction in consumer driving. As a consequence, this category will realize a nearly 1 percent decrease, or approximately 2 million units, reaching a level of 202 million units in 2008. The 2009 forecast is for no growth due to continuing difficult economic conditions.
- Replacement Light Truck Tire: This market segment is projected to decrease by approximately 2.4 million units, or nearly 7 percent, to about 32 million units in 2008. Although the number of vehicles for this market remains steady and largely represented by small commercial vehicles, declining economic conditions and fewer miles driven will contribute to a further projected 5 percent decline in replacement LT tire shipments in 2009.
- Replacement Medium/Wide-Base/Heavy On-Highway Commercial Truck Tires: This market is projected to decline to approximately 16 million units in 2008, a decrease of nearly 600,000 units or 3.5 percent over 2007. Again, the decrease reflects a further weakening of the economy and protracted recovery as fewer goods are being transported.
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The Rubber Manufacturers Association is the national trade association for the rubber products industry. Its members include more than 80 companies that manufacture various rubber products, including tires, hoses, belts, seals, molded goods, and other finished rubber products. All RMA press releases are available at www.rma.org.
RMA’s Tire Market Analysis Committee is comprised of tire market analyst professionals representing the major U.S. tire manufacturers, which account for over 90percent of all U.S. tire shipments. Their analyses and forecasts of current and future industry activity include a review of RMA tire industry and economic data, government trade figures, and vehicle sales and production. TMAC develops its consensus view for tire demand from this process. The views expressed in this release are not the sole opinion of any one committee member, member company, or RMA representative.