Magazine for the professional tire industry
Issue link: https://mtd.epubxp.com/i/148910
Your marketplace Tire pricing environment becomes more competitive at retail D ealers noted that unit volumes Monthly survey fell 1.1% compared to June of A number of independent tire dealers 2012, which marks a slowdown were surveyed concerning current business from May when dealers said that yeartrends. Except for tire prices and costs, over-year tire sales were essentially fat. the results of the June 2013 survey are While we never want to see sales slow, compared with those of June 2012. we would point out that volumes were negatively impacted by an unfavorable General outlook: June slowdown calendar shif this year that resulted in begets weaker outlook an extra Sunday this June. In spite of the By John Healy and Nick Mitchell According to our dealer survey, 29% fact that the magnitude of last month's of passenger tire dealers believe business slowdown was exaggerated by the aforementioned calendar will improve over the next six months with 64% believshif, we believe that consumer demand for replacement ing it will stay about the same. Te remaining 7% believe tires was not quite as strong as it had been in April and May. business will worsen. Meanwhile, only 19% of the truck Unfortunately, the price of gasoline is not helping maters tire dealers we spoke with see business improving and as it has now been priced higher, on a year-over-year basis, 64% believe that business trends will stay about the same. for the past eight weeks. In our view, this could be one of Seventeen percent believe it will get worse. While the the factors that has caused the collective outlook of the results of the survey do not indicate that dealers see a sharp slowdown on the horizon, the collective outlook of the respondents clearly became less optimistic. New tire sales: Dealers report June swoon While service business slowed down in June, it still out-performed tire sales, dealers note. dealers we survey to moderate. Having said that, we feel that some consumers have delayed tire replacements to the point that we will see some pent-up demand released in the coming months as consumers adjust to the incremental headwind created by the expiration of the payroll tax earlier in the year. 22 Replacement tire demand in June slowed from relatively lackluster levels in April and May. Dealers reported that they sold 1.1% fewer passenger tires in June than they did in June 2012 afer a 0.1% decline in May. Te weakness was also seen in truck tires, as dealers reported that their sales fell 1.3% (of 3.2% in May). Te lone bright spot in our latest survey was seen in the retread area, where unit sales rose 1.4%. While this is positive, it represents a slowdown from the 4.3% increase reported a month earlier. Selling prices and costs both fall Tire costs have been trending lower for months as manufacturers adjusted prices to refect lower raw material costs and, in some instances, the expiration of opening price point tires from China. Tis trend has benefted dealers, who had been able to beneft by holding onto much of their MTD August 2013