Magazine for the professional tire industry
Issue link: https://mtd.epubxp.com/i/148910
Your marketplace previous price increases. However, it appears as if dealers fnally started Dealers FEB MAR to pass these savings on Passenger tire to consumers as retail Will improve 46% 41% prices fell during June. Will worsen 23% 24% Indeed, retail tire prices Will stay level 31% 35% for premium tires fell Truck tire 1.4% in June, and prices Will improve 36% 46% on value brands fell 1.9%. Will worsen 18% 23% While our survey inWill stay level 46% 31% dicates that the pricing R-Revised P-Preliminary environment has become more competitive at retail, dealers noted that manufacturer pricing was not as aggressive. For example, 57% of passenger tire dealers characterized manufacturer pricing as aggressive (vs. 93% in May.), vs. the 73% of truck tire dealers that believe manufacturer tire prices are aggressive (vs. 92% just one month earlier). How dealers view near-term business Inventories: Passenger tire inventories look a litle beter Despite the fact that dealers have been reluctant to overorder inventory, the June slowdown contributed to a modest increase in the number of passenger tire dealers citing that they were siting on too much inventory. Specifcally, 51% of passenger tire dealers believe inventories are too high (vs. 46% in May), with the balance believing inventory levels are just right (42% last month). 24 APR MAY(R) JUN(P) JUN(12) 36% 0% 64% 47% 12% 41% 29% 7% 64% 40% 20% 40% 30% 10% 60% 47% 20% 33% 19% 17% 64% 42% 29% 29% Meanwhile, 64% of the truck tire dealers we surveyed indicated that inventories were too high (vs. approximately 24% last month), with the rest thinking they were just right (vs. approximately 75% in May). Service revenues represent a bright spot once again While service work continued to be a tailwind to dealers in June, the results of the survey suggest that service business slowed down as well. Specifcally, tire dealers noted that this category, which accounted for almost 50% of the total revenues of the study participants, rose less than 2%. Tis marks a deceleration from the 2.8% sales lif dealers reported last month, but nevertheless continues the trend of service out-performance. ■ John Healy and Nick Mitchell are research analysts with Northcoast Research Holdings LLC based in Cleveland, Ohio. Healy and Mitchell cover a variety of subsectors of the automotive industry. Quik-Link: 800-687-1557 ext. 19109 MTD August 2013