2010 Tire Shipments to Increase Three Percent

Modest Recovery Anticipated In 2010 For Both Consumer and Commercial Sectors

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

WASHINGTON, D.C.March 12, 2010 - Tire shipments in 2010 are projected to increase by approximately 3 percent or approximately 7 million units to 267 million units, according to the Rubber Manufacturers Association. Total shipments experienced an 8 percent drop in 2009 to 259.7 million units.

The increase in tire shipments reflects the onset of the economic rebound, an increase in vehicle miles traveled, and a slight uptick in auto sales. As a result, this rebound is projected to extend into 2011 reaching approximately 275 million units, as the economic recovery gathers momentum.

RMA’s Tire Market Analysis Committee forecast for key categories and their respective segments for 2010 include:

  • Original Equipment Passenger Tires:

Passenger OE shipments declined by nearly 35 percent in 2009 to 24.6 million units – a low point for recent history – attributable to the economy, and large vehicle production cuts. For 2010, light vehicle production is forecast to rebound slightly resulting in an approximate 21 percent increase in OE passenger tire shipments to nearly 30 million units.

  • Original Equipment Light Truck (LT) Tires:

Consumer and commercial demand for LT OE tires were less severely impacted by the light vehicle production cuts. As a result shipments declined only 4 percent to 2.79 million units, a 100,000 unit year-over-year drop. For 2010 this category will experience a nearly 10 percent increase to more than 3 million units reflecting a strengthening economy.

  • Original Equipment Medium/Wide-Base/Heavy On-Highway Commercial Truck Tires:

For 2009, this category decreased by 36.9 percent to 2.4 million units, attributable to the continued large economic slowdown in the commercial sector. For 2010, commercial activity is expected to pick up resulting in a nearly 8 percent increase, or approximately 180,000 additional units.

  • Replacement Passenger Tire:

The sluggish economy coupled with consumers looking to extract more miles out of their tires, contributed to a decline of 4.3 million units in 2009, representing a 2.2 percent decrease for a total of 189.5 million units. However this sector is forecast to increase by nearly 1.7 million units in 2010 – or approximately 1 percent as the measured economic recovery gains hold and the number of vehicle miles traveled increases.

  • Replacement Light Truck Tire:

This market segment realized a drop of 6.5 percent, or 1.9 million units, for a total of 27.5 million units in 2009 as soft economic conditions impacted small commercial vehicles. Given that the number of vehicles for this market remains steady, the soft economic conditions and fewer vehicle miles travelled will contribute to another nearly 1 percent decline in replacement LT tire shipments in 2010 to approximately 27.3 million units.

  • Replacement Medium/Wide-Base/Heavy On-Highway Commercial Truck Tires:

This market declined to 12.9 million units in 2009, a decrease of nearly 2 million units or 13.2 percent. However, this market will realize an increase of approximately 600,000 units in 2010 as the economy picks up, and more goods are shipped.

# # # #

The Rubber Manufacturers Association is the national trade association for the rubber products industry. Its members include companies that manufacture various rubber products, including tires, hoses, belts, seals, molded goods, and other finished rubber products.

RMA’s Tire Market Analysis Committee is comprised of tire market 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.

2009 TIRE SHIPMENTS TO POST THIRTEEN PERCENT DECLINE

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

 Nearly 6 percent growth anticipated for 2010

WASHINGTON, D.C.November 2, 2009 - Tire shipments are projected to drop by approximately 13 percent in 2009 primarily due to sharp decreases in demand for original equipment manufacturer (OEM) passenger and commercial truck tires, according to the Rubber Manufacturers Association.

Total 2009 tire shipments are projected to decline approximately 36 million units to 246 million units. This decrease reflects the difficult economic environment for automotive manufacturers over the past year, continued low consumer confidence and high unemployment. Tire shipments peaked at 321 million in 2000.

Vehicle miles travelled is on par with 2008 levels as the domestic economic conditions for both the consumer and commercial sectors appears to have stabilized and are poised for a rebound in 2010. As a result, the tire industry is expected to realize a nearly 6 percent growth in 2010 reaching the 260 million unit level.

RMA’s Tire Market Analysis Committee forecast for key categories and their respective segments for 2009 include:

  • Original Equipment (OE) Passenger Tires: Large decreases in domestic vehicle production due to plant shutdowns will result in a nearly 43 percent decrease in 2009 OE tire shipments to approximately 22 million units. The federal government’s “cash for clunkers” program pulled forward future years’ vehicle sales into 2009, which mitigated an even steeper drop in OE tire shipments. An improving economy and a rebound in vehicle production and sales are anticipated in 2010 resulting in a nearly 8 million unit increase projected for OE tire shipments. This projection does not account for any possible changes to the auto industry from further federal intervention or consumer incentive programs.
  • Original Equipment Light Truck (LT) Tires: This category will experience an approximate 9 percent decrease, or 300,000 units, in 2009 to nearly 2.7 million units due to slower economic conditions and its impact on the commercial sectors which utilize light truck vehicles. Little or no growth is anticipated for 2010 as domestic vehicle production is projected to remain weak.
  • Original Equipment Medium/Wide-Base/Heavy On-Highway Commercial Truck Tires: A nearly 41 percent decline to approximately 2.3 million units is anticipated for 2009 – a decrease of approximately 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 approximately 350,000 units.
  • Replacement Passenger Tire: Shipments will decrease approximately 12 million units to nearly 180 million units for an approximate 6 percent decline. Growth is anticipated to resume in 2010 with the replacement sector estimated to increase by approximately 4 million units, or about 3 percent, as economic conditions improve. Non-RMA imports accelerated in July and August prior to imposition of a three year Chinese import tariff on Sept. 26th. These imports are anticipated to drop off dramatically in October and remain at depressed levels through the three year period.
  • Replacement Light Truck Tire: This segment represents a core group of consumers and the small commercial vehicle market – mainly “class 3” trucks. The onset of the economic recovery has limited the impact of the decline in LT tire shipments to nearly 3 million units, or 11 percent, for a total of approximately 26 million units. Little or no increase is anticipated in 2010 in keeping with commercial economic forecasts and the impact of the Chinese tire tariff.
  • Replacement Medium/Wide-Base/Heavy On-Highway Commercial Truck Tires: The market is anticipated to decrease by approximately 2.3 million units in 2009 to nearly 12.6 million units. 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.

# # # #

The Rubber Manufacturers Association is the national trade association for the rubber products industry. Its members include companies that manufacture various rubber products, including tires, hoses, belts, seals, molded goods, and other finished rubber products.

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.