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2012 TIRE SHIPMENTS EXPECTED TO GROW BY 1.2 PERCENT
Slight downward revision given sluggish economy
August 20, 2012
Tire shipments in 2012 are projected to increase by approximately 1.2 percent – just over 3 million units- to 288 million units, according to the Rubber Manufacturers Association (RMA). The modest growth can attributed to the increase in new vehicle sales and a slight increase in vehicle miles traveled. Original Equipment (OE) Passenger Tires: Passenger OE tire shipments are anticipated to increase by 7 million units, or slightly more than 18 percent, to 42 million units in 2012 as domestic vehicle production is expected to increase. Total light vehicle sales for 2012 were revised to greater than 14 million vehicles, from 12.8 million vehicles sold in 2011. Additionally, improved OE tire shipments for 2012 vs. 2011 are partially attributed to the rebound in vehicle inventory and availability, which was affected by the 2011 Japanese earthquake/tsunami.
Original equipment (OE) tire shipments for both the light vehicle and commercial truck markets will be up nearly 16 percent for 2012 as continued pent up demand for both for light vehicles and commercial trucks will add to domestic new vehicle sales and production.
Growth in replacement tire shipments is expected to drop by approximately 2 percent, or nearly 4 million units, to 236 million total units in 2012. Overall the decline is moderated by the mild growth still projected in Gross Domestic Product and the Industrial Production Index for both the consumer and commercial sectors.
RMA’s Tire Market Analysis Committee forecast for key categories and their respective segments for 2012 include:
Original Equipment Light Truck (LT) Tires: A nearly 1 percent increase is anticipated for 2012 as domestic vehicle production using LT tires will experience a small increase tempered by soft economic conditions in this commercial sector. As a result, this category is forecast to be 4.2 million total units.
Original Equipment Medium/Wide-Base/Heavy On-Highway Commercial Truck Tires: Pent up demand for commercial trucks and trailers concurrent with a forecasted 4 percent increase in the Industrial Production Index in 2012 will enable this sector to grow by 12 percent in 2012, or nearly 600,000 units, or 5.5 million units total.
Replacement Passenger Tire: Shipments in 2012 are forecasted to decrease by approximately 2 million units, or nearly 1 percent, to 192 million units as pent up demand has failed to materialize. This is attributed to, in-part, softer economic conditions than previously forecasted. Vehicle miles travelled for 2012 has increased, in part due to the mild winter. As a result, an uptick in replacement shipments is forecasted for the second half of 2012.
Replacement Light Truck Tire: A decrease of approximately 900,000 units, or 3 percent, is expected for 2012 such that the total LT replacement market will decline to 28 million units. This is a result of 2012 new light truck vehicle sales decreasing demand for replacement tires. However, the decline will be moderated by anticipated stronger second half growth in 2012 given the soft market conditions in the latter part of 2011.
Replacement Medium/Wide-Base/Heavy On-Highway Commercial Truck Tires: For 2012, this market is forecasted to decline by approximately 6 percent, about 1 million units, to 15.5 million units as fleets opt for new equipment and the economy remains sluggish.
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The Rubber Manufacturers Association is the national trade association for tire manufacturers that make tires in the U.S.
RMA's Tire Market Analysis Committee is comprised of tire market professionals representing the major U.S. tire manufacturers, which account for more than 90 percent 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.