Modern Tire Dealer

JUN 2019

Magazine for the professional tire industry

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41 w w w . M o d e r n T i r e D e a l e r . c o m manufacturing base. Until recently Omni United was relying on Chinese plants to produce its U.S. truck tires. "In 2007 we had started positioning our manufacturing needs across several countries in an effort to avoid these geopolitical issues. Being a global company, China still plays a very important role in our manufacturing portfolio," Rhodes says. Ben Johnson, director of truck and bus radial tire marketing in the U.S. and Canada for Bridgestone Americas Tire Operations LLC, says the company's Dayton brand of truck tires is manufactured in China and sold in the U.S. He calls the regulatory environment "fluid, and we expect this fluidity to continue throughout 2019. Accordingly, Bridgestone is activating contingency plans and leverag- ing our comprehensive global supply chain to meet the needs of fleet customers. We remain confident that the diversification of our supply chain will allow for continued strong service to our customer base." But supply is only half of the issue. Gary Schroeder, executive direc- tor of truck and bus tire business at Cooper Tire & Rubber Co., says, "We believe there could be industry-wide shortages of TBR tires in the latter half of this year and this, in addition to tariffs, could drive pricing actions in the marketplace." Helmut Keller, head of brand and product management for com- mercial tires for Continental, points to the price increases some tire makers have implemented. "Supply and demand will dictate the outlook in the next months. As demand for TBR tires stays high, coupled with the recent tariffs and the possibility of supply constraints moving forward, we would expect there to be an upward trend with regard to pricing at least through 2019, and probably beyond." Rob Williams, senior director of TBR sales for Hankook Tire America Corp., says he expects demand will continue to outpace supply for the rest of 2019, and into 2020. At Tireco Inc., Mike Park, product manager of national brands, is a bit more cautious. "Medium truck tire prices will continue to rise in 2019 due to the tariff. In 2020, we may see the price stabilize but it's dependent on the tariff." Li, from ZC Rubber, says there's no ques- tion truck tire prices are going up. "It takes a long time for the transfer of production capacity from China to Southeast Asia or some other area. Furthermore after the capacity may be transferred to other areas, the production efficiency and cost will still be much higher than in China. We believe that the tire price in the U.S. market will increase continuously when the tariff is imposed on Chinese tires." He was the only one to indicate just how high prices might go. "In 2020, hopefully the increased capacity in Southeast Asia may supply more tires to U.S. dealers, though most of the capacity is owned by Chinese tire manufacturers. e market will find the balance but the price will be at least 10%-15% higher than before." Rather than only focus on the uncertain- ties, MTD also asked truck tire makers to talk about trends in the market, and how they're meeting the quest for fuel efficiency. MTD: Identify two top trends in the medium truck tire market. JOHNSON, Bridgestone: It is a dynamic time in the tire industry, particularly for the commercial tire segment. Autonomous and electric vehicles are two mega trends shaping the future of mobility, and ones we anticipate will have a big impact on the commercial truck tire market across the medium-term. As the landscape evolves, fleet customers are seeking intelligent tire solutions that are integrated into the broader truck ecosystem to help them drive efficiency and optimize performance. We are working to pioneer tire solutions that meet these needs. KELLER, Continental: Tier 1 brands will defend their premium position by offering more fuel efficient tires, improving removal mileage and providing digital solutions. Continental offers three digital tire moni- toring solutions for its fleets. Tier 2 brands will feel pressure to compete with Tier 3 as a result of the tariff situation. SCHROEDER, Cooper: Final mile delivery, driven by expansion of e-commerce, and autonomous trucks will be trends of long term importance to the truck tire market. ese changes will drive increased demand for regional or pick-up and deliver tires as well as intelligent tires that will enable fleets to improve predictive maintenance, and consequently, uptime of the vehicle. MATTHEW HANCHANA, sales technical service manager for Giti Tire (USA) Ltd.: With the rising costs of medium truck tires in trade disputes, a top trend companies are moving towards is retreads. Fleets that have their own cas- ings retreaded understand the importance of buying quality tires that they can retread two to three times. Another trend I am noticing is improved technology in tires. e pressure that tire makers are being put under by original equipment manufacturers (OEMs) to help attain fuel economy is growing. e adoption of new equipment that requires effective low rolling resistance tires is in demand. MAHESH KAVATURU, tech- nology director of commercial tires for Goodyear: Fleets are very focused on lowering their operating costs. is is driving greater demand for enhanced miles to removal, as well as fuel-efficient tires, which we expect to continue to grow as Greenhouse Gas (GHG) Phase II regulations take effect in 2021. We are also seeing an increased focus on last-mile delivery, driven by growth in e-commerce sales and the resulting proliferation of fulfillment centers. Because of this, trucks are traveling shorter distances and are increasing the amount of urban driving, which creates greater demand for tires that can withstand dynamics like curb impact. WILLIAMS, Hankook: One of the biggest trends we're seeing is the continued consolidation and acquisition in the dealer market, which has introduced Hankook products to customers who hadn't histori- cally had the opportunity to experience the Hankook TBR lineup. 2018 was a record year for truck tires in the U.S. It was record-setting in both original equipment and replacement tires. In the replacement market, the total of 21 million tires was up 7.7% from the previous high of 19.5 million in 2017. PHOTO COURTESY OF YOKOHAMA TIRE CORP.

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