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,” that’s the assessment Sentaida USA general manager Don Mathis recently gave Tyres & Accessories. In other circumstances this may have sounded exaggerated, but with the Bank of England slashing interest rates to their lowest point in the institution’s 315-year history and US interest rates heading even lower, the unprecedented economic conditions seem to suggest the international tyre trade is also entering uncharted territory.

“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,” Mathis explained. However, this year has also been unlike any other in the experienced sales manager’s 36 years in the tyre business. He believes the unique combination of surplus capacity in UHP factories mixed with the early year surge in raw material costs, 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.