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WASHINGTON, D.C., March 13, 2006 – Tire shipments for 2006 are expected to increase by just over 1 percent compared to 2005 with increases in the replacement tire market offsetting decreases in the OE markets.
The increases in tire shipments for 2006 continue to reflect steady economic growth in the consumer and commercial sectors. The group projects continued annualized growth of approximately 1.7 percent for total tire shipments through 2011 reflecting increases in the nation’s Gross Domestic Product (GDP) and Industrial Production Index (IPI).
Overall, the combined original equipment (OE) and replacement shipments for 2006 auto and truck categories are anticipated to increase by 3.8 million units to nearly 325 million units compared to 320.8 million total shipments in 2005. By 2011, this figure is projected to be approximately 352 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 2 percent to approximately 52 million units in 2006 as a result of a decrease in domestic light vehicle sales and subsequent decreases in domestic light vehicle production. A modest annualized growth of approximately 1 percent is expected through 2011 as total shipments return to the 55 million unit level as a result of increases in light vehicle sales and production and increases in the popularity of cross-over utility vehicles, which are fitted with OE passenger tires.
- Original Equipment Light Truck Tires: Approximately 6 million units is projected for 2006 and it is forecasted to remain at or near this level through 2011 as consumers opt for smaller-sized sport utility and light truck vehicles, which are fitted with the P-metric passenger tires. 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: Sales of commercial truck vehicles will experience modest growth in 2006 due to continued vehicle replacement demand and response to future changes in EPA emission regulations. The net result will be 6.5 million OE shipments for 2006. A sharp decline of approximately 15 percent is anticipated in 2007 after which growth will be erratic in response to additional EPA emission regulations taking effect in 2010. 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.
- Replacement Passenger Tire: The passenger replacement market will increase by slightly more then 2 percent to over 206 million units for 2006 representing a gain of 4.2 million units over 2005’s shipments. Growth in this category is due predominantly to increases in certain subcategories. The P-metric tire market (for SUV type vehicles) is projected to grow more than 10 percent and the High and Ultra High Performance tire markets are projected to increase more than 5 percent and 11 percent, respectively, compared to 2005. Overall, the passenger replacement market will continue to increase at approximately 2 percent per year through 2011, at which point the total units shipped will approach 227 million. Steady growth in this segment is largely attributed to continued growth in the number of vehicles on the road and increasing vehicle miles traveled.
- Replacement Light Truck Tire: This market segment is projected to increase by approximately 200,000 units to 36.2 million units in 2006 with continued growth through 2011at an average annualized growth rate of approximately 2 percent or approximately 40 million units shipped.
- Replacement Medium/Wide-Base/Heavy On-Highway Commercial Truck Tires: This market is projected to be 17.8 million units in 2006 mainly as a result of the continued growth in industrial production. An annualized growth of just less than 1 percent will be realized through 2011at which time shipments are estimated to be over 18 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.