GfK: LT tires led 'sluggish' 2017 U.S. replacement market

NEW YORK — Despite a unit sales decline of 3.1 percent last year, light truck (LT) tires led a sluggish U.S. consumer tire market in 2017 vs. 2016, according to the latest data issued by analytics firm GfK Group.

Overall, sales of passenger, LT and 4x4/SUV tires fell 5.7 percent last year, GfK data show, with passenger and 4x4/SUV tires off 7.3 and 4 percent, respectively.

GfK bases its reporting on input from retailers representing nearly 35,000 points of sale nationwide.

By comparison, the U.S. Tire Manufacturers Association (USTMA) reported earlier that replacement market passenger tire shipments in 2017 were 0.9 percent ahead of 2016 at 209.3 million units, while replacement LT tire shipments fell 2 percent to 31.3 million units.

The 4x4/SUV segment tracked by GfK overlaps the passenger and LT segments as reported by the USTMA.

LT tires outperformed the other categories despite industry-leading price growth of 2 percent last year. The firm said LT tires are the most expensive of any category at $196 per unit, higher than the overall average ($135 per unit), and almost double the average cost of passenger tires ($109).

Unit shipments of passenger tires fell 7.3 percent, while the value declined 6.9 percent, GfK said, based on a 0.4-percent increase in the average selling price of a car tires.

The GfK panel data show that 20-inch rims posted strong year-over-year growth in units at 9.9 percent, while smaller sizes have been declining. The largest unit losses came in 15-inch rims (-16.8 percent), followed by 16-inch (-11 percent) and 17-inch (-2.9 percent).

Meanwhile, GfK said 4x4/SUV unit sales dropped 4 percent from the 2016 period, while the value dropped 3.2 percent and the price fell 0.7 percent.

Neil Portnoy, managing director of GfK's POS (point-of-sale) Tracking team, said the light-truck segment has held its own in a challenging marketplace, "recording relatively small losses despite very high costs.

"To some extent, retailers have been forced to pass on price increases dictated by rubber costs and other factors," Mr. Portnoy said. "At a time when consumers are increasingly price savvy and not always brand loyal, this poses a challenge. To maximize profit in this marketplace, retailers and manufacturers alike need the timely metrics that GfK's tire panel is delivering."

GfK said its POS tracking panel for the U.S. tire retail marketplace represents 62 percent of all tire sales nationwide.