Crain News Service report
AKRON (Feb. 5, 2014) — With the new year barely a month old, that means it’s still time for forecasts.
The problem is deciding whom to trust, because often the prognostications put forth contradictory information.
For example, a number of economists generally predict sluggish growth—many saying less than 2 percent for the year. On the other hand, 73 percent of CEOs surveyed by the Business Roundtable expect higher sales this year, and another 18 percent look for revenues to remain steady. And a survey of purchasing and supply executives look for manufacturing to grow at more than 4 percent, with the rubber and plastics sector cited as having one of the rosiest outlooks for the year.
The automobile industry is one area where everyone expects good news. That means U.S. light vehicle sales of more than 16 million units, the first time that mark would be reached since the pre-recession year of 2007. Even better, the higher numbers are being brought on by organic growth, not by auto makers pulling sales forward with unsustainable incentives that bleed profits.
Suppliers to the auto industry now should be in a better position to meet higher demand than when the auto market bounced back quicker than expected after the recession, leaving a smaller supplier base scrambling to meet the needs of its car maker customer base.
Another virtual certainty this year is that little will get done in Washington during this mid-term election year. Officials at the Rubber Manufacturers Association say this is a time to “define and defend” the positions of its tire maker members. Scrap tires remain big on the group’s agenda, as does the expected final rule on tire fuel efficiency standards and the funding of transportation projects.
The bottom line: Use the forecasts to help plan your strategy, but have the flexibility to react when the unexpected undoubtedly happens in the coming year.
This editorial appeared in a recent edition of Rubber & Plastics News, an Akron-based sister publication of Tire Business. It has been edited slightly from its original version.
Are you paying attention to the ups-and-downs of the stock market?
|Yes, I invest in the market||
|Yes, but I mostly keep an eye on just my company's stock||
|No, it makes me nauseous||
|I’m glad I don't invest in the market; I would have lost my shirt||
|Total votes: 99|
Titan International and the United Steelworkers union have petitioned the U.S. International Trade Commission and U.S. Department of Commerce seeking relief from OTR tire imports from China, India and Sri Lanka. What’s your opinion?
|I wholeheartedly support their action – something needs to be done.||
|I think it’s a bad idea that could inevitably tie the hands of domestic tire makers.||
|I oppose any duties against tire importers—they only raise costs for distributors and make it harder to obtain inventory.||
|I’m kind of on the fence and not sure what’s right, but need more information before deciding.||
|I don’t really care whether or not relief is granted.||
|Total votes: 78|