Magazine for the professional tire industry
Issue link: https://mtd.epubxp.com/i/244093
MTD: What were the U.S. replacement shipment highlights in 2013 vs. 2012 for passenger tires? Mitchell: Tere was a nice recovery in shipment trends in 2013 with volumes up 3% to 4% through the frst 11 months of the year. Te recovery was led by stronger import trends, largely from China. MTD: How about replacement shipment highlights for light truck tires? Mitchell: Light truck tires were fairly stable in 2013, with volumes approximately flat through November. MTD: What are the lasting efects of the elimination of the Chinese tire tarif on Sept. 26, 2012? Mitchell: Tis is an interesting question as it naturally assumes that we will not see another tarif implemented in the next decade, which I think is a risky bet for these retailers that are shifing more of their product ofering toward Chinese manufacturers. I can say without a doubt that the greatest lasting impact has been the rude awakening it provided to select high-cost manufacturers that compete in the botom half of the Tier Two segment and in the Tier Tree category. MTD: And for medium truck tires? Mitchell: Demand for medium truck tires performed the worst, as volumes were fat to down 1% headed into the fnal month of 2013. MTD: There was a lot of pent-up demand for tire purchases in 2013. Are consumers still puting of buying tires? Mitchell: Despite the modest improvement in volumes in 2013, consumers are still reluctant to spend money on tires unless they need to. Similar to last year, dealers continue to say that their internal data suggests that the average tire coming of the road today only has 2/32-inch of tread, which is well below the historical average of 4/32 to 5/32. As a result, dealers continue to note that they expect to see some of the pent-up demand to make its way back to the market over the next 12 months. Te one caveat is that the enthusiasm behind this thesis has been tempered slightly over the past 12 to 18 months as some folks think that the recovery will be very gradual without the market ever really experiencing that one-time snap back in volumes that everyone has hoped for since the onset of the Great Recession. MTD: What is the state of dealers' and manufacturers' inventory levels? Mitchell: Sell-in to the channel has signifcantly outpaced sell-out in 2013, which means inventory levels are much healthier among wholesalers and installers relative to this time last year. I estimate that units at these two stages in the supply chain are probably up 3% to 4%. I do not get the sense that inventory at the manufacturing level has changed much over the past year as all the players are focused on limiting working capital investments. www.moderntiredealer.com Quik-Link: 800-687-1557 ext. 11108 17