No Going Back

In 2008 the Ultra High Performance tyre market experienced changes unlike any year before it; and as a result will, never be the same again, Sentaida USA general manager Don Mathis recently told Tyres & Accessories

“UHP aftermarket sales have been the main and nearly only, shining star in the tyre business for the last eight to 10 years. The margins and growth have surpassed nearly every other segment of the market,” he explained. However, this year has also been unlike any other in Mathis’s 36 years of experience. His thinking is that the unique combination of surplus capacity in UHP factories, the early year surge in the raw material costs, a mid-year surge in fuel cost, and the credit crunch halting new car sales and taking aftermarket wheel sales with them means the market has hit a watershed.

His advice? “Reduce your UHP stock to bare minimum. I think it is really ugly now, and is going to get worse. Clear out old, high priced stock, so money can re-circulate. Take whatever loss there is now. Get it over with, as it will only get worse in 2009. Buy smart for the future with an emphasis on value in the popular passenger car sizes.” For more overview on US market sales see January’s issue of Tyres & Accessories.