Magazine for the professional tire industry
Issue link: https://mtd.epubxp.com/i/449261
MTD January 2015 tires are already saddled with a 4% duty.) Over that span, average replacement tire prices increased 30%. Without the tarifs, pricing has dropped each of the last two years. Although low-cost radial production in the U.S. cannot keep up with demand, the Department of Commerce once again agreed with the union. On Dec. 1, 2014, it implemented coun- tervailing duties on all consumer tires, broken out as follows: • 11.74% for Giti Tire (Fujian) Co. Ltd. • 12.5% for Cooper Tire & Rubber Co. • 81.9% for Shandong Yongsheng Rubber Group Co. Ltd. • 12.03% for all other Chinese exporters. (The DOC is expected to add anti-dumping duties to consumer tire imports from China before the end of January; ST tires are exempt from either tarif.) Except for Giti and Cooper imports, the additional tarifs are retroactive 90 days from Dec. 1, their efective date. Tat means even tires imported on or afer Sept. 2, 2014, are subject to the additional duties. Giti and Cooper were exempt because they kept their import volume growth in check. Te resulting consequences relating to the decisions were severe and swif. Two tire manufacturers raised prices. Giti Tire (USA) Ltd. announced a 9.5% increase on all passenger and light truck tires, efective Jan. 1, 2015. Cooper Tire quietly increased prices 6% to 8% on some, but not all, of its Cooper and Starfre lines, also efective Jan. 1. Shandong produces some of the private brand tires for Del-Nat Tire Corp., which is in talks to sell to TBC Corp. In a leter to Del-Nat shareholders, CEO Brian Grant referenced how Del-Nat was "signifcantly impacted" by the recent coun- tervailing duties imposed on consumer imports from China. Shandong was one of three Chinese manufacturers that produced the Fuzion brand for Bridgestone Americas Inc. Now there are two sources. "We knew back in September that they would be assigned the maximum CV (countervailing) tarif, so we moved molds and shifed production to the other plants," says a Bridgestone spokesperson. "The other two plants have the necessary capacity to handle our volume needs." Tire shipments, 2014... and 2015 Replacement and original equipment tire shipments were up across the board in 2014 vs. 2013 (not counting farm and OTR tires). Passenger tire shipments were up 2.5% and 4.5%, respectively (see Chart 3 on page 30). Light truck tire shipments — LT sizing, not P-metric light truck — were up 1.7% and 9%, respectively. Te growth in the truck tire segment, which includes wide- base and heavy truck tires as well as medium truck tires, was particularly robust. Replacement shipments were up 10.2% year-over-year, while OE shipments increased 16%. Demand for commercial vehicles in the U.S. and Canada continues to strengthen, though used commercial vehicle registrations still outnumber new registrations, according to Gary Meteer, director of commercial vehicle solutions for the IHS Automotive division of IHS Inc. Speaking to industry executives at the 2014 Automotive Afermarket Products Expo in Las Vegas, he said the average age among Class 4 to 8 trucks has risen from 12.5 years in 2007 to 14.7 years. Te Rubber Manufacturers Association (RMA) estimates total U.S. replacement and OE tire shipments will increase from nearly 310 million units in 2014 to slightly more than 310 million this year. "Passenger original equipment shipments are expected to increase in 2015 due to anticipated growth in auto sales, while replacement tire shipments are expected to decline less than 1%," said the RMA. "Light truck and commercial truck original equipment and replacement tire shipments are expected to grow in 2015." Facts section: Tire shipments Chart 6 2014 U.S. TRUCK TIRE IMPORTS FROM CHINA (based on 8.2 million units) Sources for Charts 5-6: U.S. government, MTD fgures Chart 5 U.S. CONSUMER TIRE IMPORTS BY COUNTRY (units, in parentheses, are in millions) 2014 rank/country 2013 rank % change vs. 2013 1. China (60.5) 1 +17.9% 2. Canada (19.6) 2 -4.8% 3. South Korea (18.0) 3 -9.0% 4. Thailand (12.2) 6 +10.9% 5. Indonesia (11.1) 5 -0.9% 6. Mexico (10.8) 4 -0.9% 7. Japan (10.1) 7 -2.9% 8. Taiwan (7.3) 8 +1.4% 9. Chile (6.8) 9 +13.3% 10. Germany (3.7) 10 +5.7% 32