OE Markets as Main Contributor
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WASHINGTON, D.C., August 2, 2011 – The Rubber Manufacturers Association revised its 2011 tire shipment forecast upward to approximately 4 percent – nearly 11 million units- to 296 million units.
Original equipment (OE) tire shipments for both the light vehicle and commercial truck markets will add approximately 5 million of the combined total 11 million OE and replacement units increase in 2011 as pent up demand for both for light vehicles and especially commercial trucks continues to drive domestic new vehicle sales and production.
Growth in replacement tire shipments will remain modest in 2011 as persistent high fuel costs and little or no change in the number of miles driven will temper the overall growth rate to a little more than 2 percent, or approximately 251 million total units. However, the forecast still remains guardedly optimistic.
RMA’s Tire Market Analysis Committee 2011 forecast for key categories include:
• Original Equipment (OE) Passenger Tires: OE tire shipments were revised slightly lower to approximately 36 million units, an 8.5 percent increase. This is a result of decreased vehicle production due to the Japanese earthquake/tsunami and its impact on component suppliers. Total light vehicle sales for 2011 are projected to be approximately 13 million vehicles, up from 11.6 million vehicles sold in 2010.
• Original Equipment Light Truck (LT) Tires: This category is forecast to experience an nearly 18 percent increase in 2011 to approximately 4.3 million units due to the shift to larger vehicles as a consequence of pent up demand, buyer incentive programs along with improved economic conditions in commercial sectors that utilize light truck vehicles.
• Original Equipment Medium/Wide-Base/Heavy On-Highway Commercial Truck Tires: The forecast for medium OE tire shipments was upwardly revised to approximately 47 percent increase in shipments, or about 4.7 million units. This underscores the pent up demand for commercial trucks and trailers concurrent with a predicted greater than 4 percent increase in the Industrial Production Index.
• Replacement Passenger Tire: Growth in this category is anticipated to be just below 1 percent as continued high energy costs, decreases in non-essential driving, and continued economic uncertainties weigh on the consumer. The nearly 1 percent growth is forecast to result in less than a 2 million unit increase for 2011 with total passenger replacement units reaching approximately 202 million units.
• Replacement Light Truck Tire: This category, represented by small commercial vehicle market – mainly “class 3” trucks, is expected to increase by more than 2 million units to approximately 31 million units in 2011. This equates to a gain of more than 7 percent and is primarily attributed to the economic recovery in the commercial sector.
• Replacement Medium/Wide-Base/Heavy On-Highway Commercial Truck Tires: The forecast for this market was revised upward as commercial trucking has remained strong concurrent with the predicted 4 percent increase in the Industrial Production Index. As such, the market is anticipated to increase by approximately 2 million units in 2011 to nearly 18 million units.
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The Rubber Manufacturers Association is the national trade association for tire manufacturers that produce tires in the U.S. All RMA press releases are available at www.rma.org.
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.