Retreaders this year should benefit from a continuing improvement in the economy and the resultant buoyancy in trucking activity.
The amount of goods shipped by truck should increase about 5 percent in 2005 over 2004, according to trucking industry sources. While down slightly from the 6- to 7-percent growth booked in 2004 vs. 2003, it represents growth nonetheless.
This should translate into steady growth in U.S. shipments of both new truck tires and tread rubber through 2007, according to the Rubber Manufacturers Association (RMA).
Ironically, retreaders are benefiting from high oil prices, according to Harvey Brodsky, managing director of the Tire Retread Information Bureau (TRIB), as truckers are taking a hard look at their operating costs and realizing substituting retreads for new tires is one area where they can save money.
``We're getting calls from owner/operators and even small fleets that have never used retreads before, asking about our retread info kits,'' Mr. Brodsky said.
The rising prices of new tires-also influenced by oil prices-compounds this thinking, Mr. Brodsky said, citing dozens of conversations he and the TRIB staff have had with retreaders in recent weeks. ``New tire prices are doing retreaders a world of good,'' Mr. Brodsky said, as the price differential between new tires and retreads grows.
The weak dollar and a strong new truck equipment market also could affect tire supply next year, said Marvin Bozarth, retreading consultant with the Tire Industry Association, as imports become more expensive and tire makers work to fill original equipment contracts.
For the year just completed, shipments of tread rubber grew 2.3 percent vs. 2003, the RMA said, or the equivalent of about 16.7 million units retreaded.
The growth in tread rubber demand parallels the expected growth in replacement market demand for medium tuck tires, the RMA said in recent forecasts. The market grew about 3.2 percent last year to 16 million units and is projected to grow about 2 percent a year through 2006.
However, the replacement market is expected to plateau at about 16.7 million units from 2007-2009.
In Canada, replacement market shipments through September 2004 were running 7 percent ahead of 2003, according to Rubber Association of Canada data.
Tread rubber makers have been active in the past year trying to keep pace with the growing market.
Michelin Retread Technologies Inc. (MRTI) doubled capacity for Pre-Mold precured tread rubber at its 5-year-old Covington, Ga., tread rubber plant as the number of franchised MRTI plants in North America grew by a dozen to 50.
Marangoni Tread North America Inc. opened a $10 million tread rubber plant in Madison, Tenn., and immediately disclosed plans to double output of its proprietary Ringtread spliceless precured tread to more than 1,400 treads a day by 2006. There are now 14 Ringtread retreaders in North America,
At the same time, though, Cooper Tire & Rubber Co. began converting a portion of its Athens, Ga., retread materials plant to the production of racing tires.
Associated Rubber Co. sold its tread rubber assets to Mexico's Industrias de hule Galgo, which is expanding its plant in Mexico City. Galgo distributes Pre-Q treads through its Pre-Q Rubber Ltd. unit in Dallas.