Modern Tire Dealer

APR 2019

Magazine for the professional tire industry

Issue link:

Contents of this Issue


Page 49 of 85

M T D A p r i l 2 0 1 9 48 OTR MARKET CONTINUES IN GROWTH MODE T he consensus coming from speakers at the 64th annual Tire Industry Association (TIA) Off-the-Road Tire Conference is that the econ- omy is strong and prospects for growth in 2019 are expected. All of this spells moderate-to-strong demand for the OTR tire industry. Ken Simonson, chief economist for the Associated General Contractors of America, told attendees that the U.S. economy is still growing well. He said that 304,000 jobs were added in January, making the total number of new jobs 2.8 million during the past 12 months, the most since 2015. A recent survey done by the National Association for Business Economics (NABE) — an association for non-academic econo- mists and other people who use economic information in the workplace — revealed that "the 280 respondents in general do not see any recession hitting in 2019, only 10% of them thought it possible. Forty-two percent do think there will be a recession in 2020, but another 25% think 2021, and the remainder think it will be aer 2021," said Simonson. Indicators at both the consumer and business levels are generally high, with construction employment at an 11-year high. Simonson did mention that trade and fiscal policies continue to linger in the background, and there is a labor shortage for the construction industry. He said there were 382,000 job openings in construction at the end of December, more than double from the year prior. Of this amount, contractors were only able to hire 219,000 employees in December. As MTD reported in our February issue, labor shortage issues are a major concern across the tire dealer community as well. In looking forward, Simonson does not believe a federal infrastructure bill will be passed in 2019, but state highways funding and other projects, particularly in the public and private airport sectors, are growing substantially. He is expecting residential spending to grow in the 3% to 4% area for 2019, a slight downturn from 2018. Kevin Rohlwing, senior vice president of training for TIA, looked at the mining industry expectations for 2019. He said that U.S. coal production actually declined in 2018 by 20 million short tons. Appalachian coal production increased, but interior and Western production declined. Rohlwing said the U.S. Energy Information Administra- tion is predicting a decline of 3% in coal production for 2019. Part of the reason for the decline is due to China's decrease in importation of coal. Commodity pricing for aluminum, cop- per, nickel, zinc and iron ore held steady in 2018, according to Rohlwing, with all segments, except for iron ore, looking for a slight growth in 2019. Gold and silver pricing are both expected to increase between 7% and 10%, according to various sources that Rohlwing used for his research. Rohlwing used part of his presentation to discuss Rare Earth Elements (REE) that are used for high tech devices such as magnets in cell phones, televisions, computers, auto- mobiles, military equipment wind turbines and jet aircra. In 2017, Rohlwing said that China produced 116.9 million tons, or 86.6%, of the global production of REEs. According to a U.S. geological survey, OFF-THE-ROAD MARKET MUST EMBRACE NEW TECHNOLOGY, PANELISTS SAY O T R T i r e C o n f e r e n c e Greg Smith By Pictured are college basketball fans Sandy and Brad Potter of Potter Oil & Tire Co. Inc. (left) and David Martin (immediate past president of TIA) and Karen Gosnell. However, each couple was made up of one Duke supporter and one North Carolina supporter. Did BKT Tires USA Inc. representatives drive to Tampa, Fla., in this Monster Jam World Finals truck? Doubtful, but it was on display at the OTR conference.

Articles in this issue

Archives of this issue

view archives of Modern Tire Dealer - APR 2019