US Tyre Shipment to Decrease More than 6% in 2008, Says RMA

According to the Rubber Manufacturers Association, US tyre shipments are projected to decline by more than six per cent this year compared with 2007, with a further one per cent decline predicted for 2009. Total tyre shipments were below 300 million for the first time since 1997, when shipments were 290 million units.

The decrease in tyre shipments, says the RMA, reflects the sharp downward revisions in the domestic economic conditions predicted for both the consumer and commercial sectors. Overall, combined OE and replacement tyre shipments for 2008 light vehicle and truck categories are anticipated to decrease by more than 20 million units to approximately 290 million total shipments, compared to the 310 million total shipments in 2007. A further slight decline of approximately three million total units to nearly 287 million total units is anticipated for 2009 as an economic rebound is unlikely to occur until the latter half of the year.

The RMA’s Tire Market Analysis Committee have made forecasts of key categories and their respective segments for 2008. The OE passenger car tyre category is projected to decrease by more than 14 per cent to approximately 39 million units in 2008 as a result of continued decreases in domestic vehicle production. A further decrease of approximately three per cent is expected for 2009 due to a delayed economic recovery and continued market share gains for light vehicle imports. This projection, however, does not account for any changes to the US auto industry as a result of recent requests for federal financial assistance or potential for bankruptcy.

For OE light truck tyre, consumer demand for vehicles with higher fuel economy, a shift in vehicle fitments to P-Metric passenger tyres and market share increases by import vehicle manufacturers have combined to significantly impact light truck vehicles fitted with light truck tyres. As a result, RMA forecasts a decrease of approximately 34 per cent in 2008 for a total of 2.9 million OE units, representing a 1.5 million unit decrease from 2007’s total. For 2009, another 100,000 unit decrease is anticipated owing to the slow economic recovery and its impact on the commercial sectors that utilise light truck vehicles.

The OE truck tyre category in 2008 is predicted to decrease by approximately 16 per cent to nearly 3.9 million units. This decrease is attributed to the larger than anticipated economic slowdown in the commercial sector. This will continue into 2009 and as a result, the RMA forecasts a further decrease of approximately eight per cent or 300,000 units for a total of 3.6 million units. Given this protracted economic downturn, the expected pull-forward effect of truck sales into 2009 owing to anticipated changes in EPA regulations in 2010 has been discounted.

The slowing US economy, higher energy costs and declines in miles travelled contributed to a decline in the replacement passenger car tyre market. As a consequence, this category will realise a nearly 2.7 per cent decrease, or approximately 5.5 million units, reaching a level of 198 million units in 2008. No growth is expected for 2009 due to soft economic conditions.

The forecast for the replacement light truck tyre segment is a 4.5 million unit decrease, or nearly 13 per cent, to about 29 million units in 2008. Although the number of vehicles for this market remains steady and largely represented by small commercial vehicles, declining economic conditions and fewer miles driven will contribute to a further projected four per cent decline in replacement LT tire shipments in 2009.

In 2008 the RMA forecasts a decline in the replacement truck tyre market to approximately 15.4 million units, a decrease of nearly 1.2 million units or 7.1 per cent over 2007. The market will realise another decrease of 300,000 units in 2009 as fewer goods will be transported as a result of the economic slowdown and protracted recovery.