Magazine for the professional tire industry
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MTD January 2016 Commercial tire market New truck tires were plentiful, but not as proftable Facts section: commercial Chart 13 2015 U.S. REPLACEMENT MEDIUM/HEAVY TRUCK TIRE BRAND SHARES (based on 18.0 million units) Bridgestone 17.5% Michelin 17.5% Goodyear 12.0% Yokohama 9.5% Firestone 8.0% Continental 5.0% Double Coin 4.0% Hankook 3.5% General 3.0% Hercules 2.5% Toyo 2.5% BFGoodrich 2.0% Dynatrac 2.0% Roadmaster 2.0% Sailun 2.0% Dunlop 1.5% Gladiator 1.0% Kelly 1.0% Kumho 1.0% Sumitomo 1.0% Others 5.0% Brands must have at least 1% of the market to be listed at 1%. Chart 12 U.S. TRUCK TIRE IMPORTS FROM CHINA (in millions of units) Year Units Yr./yr. change 2015 9.4 +14.6% 2014 8.2 +30.1% 2013 6.3 +0.1% 2012 6.3 +13.5% 2011 5.5 +37.5% 0 5 10 15 20 Retreaded truck tires New truck tires 2015 2012 2009 2006 2003 2000 (Shipments in millions) (Shipments in millions) 1997 Chart 11 2000-2015 TRUCK TIRE REPLACEMENT MARKET BREAKDOWN (Before 2009, the number of retreaded truck tires produced last topped new truck tire shipments in 2004.) In 2015, the average price of a retreaded truck tire was $232.43. The average price of a new truck tire was $355.55. D emand for new truck tires was high in 2015, and independent tire dealers delivered. Compared to 2014, replacement shipments were up 4%, to 18 million units. In addition, imports from China increased 14.6%, to a record high of 9.4 million units (see Chart 12). Unfortunately, proftability sufered because of those very imports. Te price of a new Chinese truck tire kept dropping as the year went on. Sofening demand in the second half of 2015 only exacerbated the problem. How bad did it get? Even with the Federal Excise Tax included, new Chinese truck tires were selling for less than the cost to retread a tire. Retreaders were asking for their own tarif treatment. Overall, the average cost of a new truck tire dropped nearly 7%, from $381.50 to $355.55. According to David Shaw, CEO and head of research for Tire Industry Research, China has the capacity to produce 150 million truck and bus tires annually. "Tere is capacity in China to make every single truck tire that the world needs," he says. 58