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February 11, 2000 01:00 AM

Farm tire market: Expect more and larger sizes — more radials, too

Larry Wingert
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    AKRON (Feb. 11, 2000) — ``Everyone in the farm business is an eternal optimist," said Neil Rayson, farm sales specialist for Continental General Tire Inc.

    It´s that optimism that´s helping them see the light at the end of the current tunnel.

    After what Titan International Inc. President and CEO Maurice Taylor Jr. characterized as a run of "gangbuster years" from 1991 to 1998, the market changed abruptly last year.

    A combination of poor prices for farm commodities, bad weather in many parts of North America and economic crises overseas that dried up export markets sent the overall farm economy into a tailspin and had many farmers limiting discretionary purchases severely.

    The result: North American shipments of replacement tractor and implement tires fell nearly 10 percent from 1998 to 1999, according to industry estimates.

    The situation was even worse in the original equipment sector, as the economic downturn in Asia, Latin America and, to a lesser extent, Europe significantly curtailed demand for large U.S.-made tractors and other farm equipment.

    Shipments of tractor and implement tires to North American OE manufacturers skidded more than 30 percent.

    "We expect it (OE shipments) to start gradually picking up this year," said Bill Cunningham, Goodyear´s marketing manager for farm and specialty tires. However, it will take two to four years to fully come back, he said.

    Replacement shipments this year should hold steady at 1999 levels or increase slightly, manufacturers agreed.

    That´s not to say there won´t be some areas of growth, and farm tire makers agreed that radial rear/drive tractor tires will be a major one.

    "There is an inevitability about the radialization of the ag tire market," Mr. Rayson said.

    "Newer, high-tech equipment all comes on radials," Mr. Cunningham said. Furthermore, as farms have increased in size, farmers have become more sophisticated and increasingly cognizant of the advantages radial tires offer, Mr. Rayson said.

    Other "hot" segments include products that have applications on and off the farm: R-4 industrial tractor tires for backhoes, skid-steer tires and all-terrain vehicle tires.

    Titan is a leader in the ATV segment, Mr. Taylor said. "We have to come out with a new tire every 12 months. Everyone wants something different."

    Product diversification is a leading trend in the ag tire sector, Mr. Cunningham agreed, with an increasing variety of tread designs, lug depth and sizes being developed to produce tires designed for optimum performance in specific locales, soil conditions and applications.

    "Our motto is: the right tire for the way you farm," he said.

    Having the right tire is one thing, but with so many different types and sizes, the challenge is having the right tire in the right place at the right time, Mr. Cunningham said.

    Adding to the complexity is the fact that radial tire sizing is being converted to metric, he added, but this conversion also provides an opportunity for uniformity in all sizes across all manufacturers.

    Such size uniformity can be particularly critical on tractors with front-wheel assist or four-wheel drive, Mr. Cunningham said, where differences in overall tire diameter — even among tires that are nominally the same size — can result in transmission damage.

    Trends in radial rear tractor tires include larger overall diameters, but widths that either are growing narrower to accommodate various row crops or wider to enhance flotation and reduce soil compaction, the tire makers agreed.

    Mr. Taylor also pointed to the growth of what he called "jumbo singles," which are designed to replace dual-tire configurations in certain applications.

    In general, though, Mr. Taylor was less convinced of the desirability of radial tractor tires than his peers, believing that their advantages vs. bias have been oversold.

    Radial farm tires lack the steel cords and belts that make their large off-the-road cousins so rugged, he said, and their thinner sidewalls can even make them more vulnerable to damage than a comparable bias-ply tire.

    One area of radial superiority he did not dispute was on-road performance, where radials can run faster, cooler and more comfortably than bias-ply tires, and with less wear.

    But that advantage is much less significant in North America, Mr. Taylor said, because farmers here spend much less time driving on roads than they do in Europe, where radials already dominate the market.

    Mr. Rayson acknowledged that in Europe, where all Continental-brand farm tires are made, 30 percent of farm tire wear is the result of on-road travel.

    But farmers in North America are traveling greater distances between fields on the road, he said, and increasingly require tires with better road-going capabilities.

    As for Continental General, which re-entered the North American farm tire market last year after a three-year absence, the company has its initial network of dealer-distributors 80-percent complete, Mr. Rayson said, and should be close to 100 percent by the end of the first quarter.

    After that, the company´s focus will shift to helping distributors grow their Conti-brand business by tailoring support programs to their individual needs, he said.

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