LOUISVILLE, Ky.—Most of North America's retreaders can look forward in coming months to a continuation of the strong market demand they enjoyed during the last half of 1996. At least that's the prediction of the Tire Retreading/Repair Journal published by the International Tire and Rubber Association.
However, an increasingly smaller number of U.S. shops will be on hand to carve up this market, according to Marvin Bozarth, executive director of the Louisville-based association, who prepared the article for the magazine's December issue.
During 1997, Mr. Bozarth looks for production of an estimated:
16.7 million medium truck retreads—up slightly from 16.5 million last year and an increase of 4.3 percent from 1995;
7 million light truck retreads—about the same number as last year but down 2.7 percent from 1995;
3.9 million passenger retreads, down 7.1 percent from 4.2 million units in 1996 and an estimated 5 million the year before;
465,000 large off-the-road retreads, down 3 percent from 468,000 units in 1996 but still well ahead of the 463,000 units produced in 1995; and
197,000 aircraft retreads, compared with 195,000 last year and 190,000 in 1995.
If the market's strength over the last six months can be taken as an indication of what's to come, retreaders in 1997 should experience ``one of the best years ever,'' Mr. Bozarth wrote.
Meanwhile, the number of U.S. retread plants is down to 1,351 from more than 3,000 in 1985; of these, only about 200 plants are actively retreading passenger sizes, he said.
Although many retreaders complained of lackluster sales during the first few months of 1996, production began to pick up in May—and by June, many plants were running near capacity, he said.
Fortunately for retreaders, the cost of tread rubber did not increase during 1996, and there is little indication that it will do so for at least six months, Mr. Bozarth said.
Meanwhile, retread quality continues to improve, as more and more shops update their equipment and inspection technologies and invest in specialized training for production personnel, he said.
What's more, with the probable exception of scarce sizes, retreaders also should benefit from reduced prices of medium truck tire casings, a factor in limiting production of some sizes during 1996.
Shortages of 10.00-20 bias-ply casings, for example, have pushed the cost of 14-ply casings to more than $50 in some parts of the country. There, such casings often command a higher price than 11R22.5 radials—considered the most popular tire for retreading in the U.S.
A shortage of casings was one reason retread production for the intermodal transport industry was off 10 percent last year, Mr. Bozarth said.
Ironically, even as passenger retreading continued its downward spiral in 1996, many retreaders found difficulty in obtaining a sufficient supply of retreadable casings, the publication reported.
Some of the problem results from scrap tire recycling programs that pay as much for disposal as the casing will bring for retreading purposes, according to Mr. Bozarth. ``There are tremendous numbers of retreadable casings being shredded or burned,'' he said.
Passenger tire retreading was dealt a surprising blow in 1996 when Achievor Tire—North America's second-largest passenger and LT tire retreader behind Prineville, Ore.-based Les Schwab Tire Centers Inc.—closed its Chicago production facility during July. At the time it closed, the plant produced nearly 300,000 passenger retreads annually.
Achievor's equipment subsequently was purchased by Ray Carr Tires of Harrisonburg, Va., which may re-locate the production facility either in that state or nearby West Virginia.
While mud and snow designs are popular for light truck applications throughout the U.S., production of passenger M & S retreads is limited to the northern states. Most passenger tire retreaders produce all-season designs rather than heavy-duty M & S retreads, Mr. Bozarth said.