2006 to be Down 4.5 per cent: RMA

(Akron/Tire Review) No one doubts that 2006 has been a very tough year for tyre dealers and manufacturers alike. The RMA revealed yesterday just how tough the year will finish: tyre shipments will be down 4.5 per cent overall compared to the record-setting results of 2005. RMA said the decrease in tire shipments “reflects the overall slowdown in the U.S. economy during 2006,” driven by a shrinking GDP, higher energy costs, and a declining housing market. OE and replacement segments combined in all categories shows shipments will be down some 14 million units to a total of 306 million tyres.

The trade group has adjusted its shipment predictions twice in 2006, reflecting the shifts and uncertainty of the market. For the first six months of the year, most experts agreed that shipments were down in the 6 per cent – 7 per cent range. Shipments rebounded slightly in the second half as gas prices stabilized.

For 2007, RMA projects a modest rebound with total tyre shipments expected to increase by nearly 4 million units to 310 million units, or up some 1.4 per cent. Segment by segment, here is what RMA sees for the coming few years:

OE Passenger: Projected to fall by more than 8 per cent approximately 48 million units in 2006 as a result of a decrease in North American passenger vehicle sales. No growth is expected in 2007 with total shipments remaining at around the 48 million unit level. OE Light Truck Tires: Approximately 5 million units are projected to be shipped in 2006 to be followed by a 4 per cent unit increase in 2007.

OE Medium/Wide-Base/Heavy Truck: Approximately 6.8 million OE units will be shipped in 2006, up 9 per cent. A sharp decline of approximately 20per cent, or approximately 1.5 million units, is anticipated in 2007.

Passenger Replacement: The market will decrease by about 3. 2per cent or 2006 to roughly 196 million units. P-metric SUV tires and UHP markets are projected to be up in 2006 by some 4 per cent and 12 per cent, respectively. Modest rebound of over 2 per cent is forecasted in 2007.

Replacement Light Truck: The segment will decrease by 7.2 per cent percent to 33.4 million units for 2006 due to the increasing popularity and numbers of cross-over vehicles and smaller SUVs that use P-metric tires.

Replacement Medium/Wide-Base/Heavy Truck Tyres: The market will be down about 2 per cent to 17.2 million units in 2006. Shipments are expected to increase in 2007 and reach 17.5 million units.