Despite a myriad of concerns in the tire industry — from the U.S. trade dispute with China and its impact on the industry to a rising number of SKUs demanding more storage space and more deliveries from wholesalers, to the growing problem of finding reliable workers — if you look at the sheer number of vehicles on the road, it's hard to believe the industry is weak.
It's not. We believe the tire industry is in a good place.
Next time you're stuck in traffic, take a quick count of the cars around you and multiply by four. By the time rush hour traffic starts to break up, you'll be tired of counting. And each of those car owners is going to need new tires at some point.
Vehicle registrations in the U.S. increased by 17.1 million last year to nearly 286 million vehicles, including about 11.6 million light trucks and 5.4 million cars.
In terms of vehicles in operation (VIO), data from the Auto Care Association (ACA) show that though the number of cars registered throughout the U.S. fell 0.6% to 118.7 million, the number of light trucks registered grew 4.5% to 159.4 million.
That's a lot of potential tire sales.
There is a lot to digest in our annual Market Data Book, which was methodically culled together by the dedicated Tire Business staff here in Northeast Ohio. The methodology of putting together the data book didn't happen overnight; it has been a process that has taken more than 30 years to refine.
Today it means a lot of emails and phone calls and diving into available research from inside the industry, the government and the files of Tire Business Market Data Books of the past. Before email, it meant waiting for the fax machine, and before that, the staff sent a lot of letters to gather the information.
Here in the office, this edition helps our journalists track changes in the industry and gain a better understanding of how announcements of mergers and acquisitions or a new factory here or there will change the industry as a whole.
For some perspective, let's look back 20 years to the Feb. 28, 2000, edition of the Tire Business Market Data Book.
The top tire retailer in the 2000 edition was Sears/NTB with tire sales (and related service) of $2.35 billion at 1,163 locations. Adjusted for inflation, today that number would be around $3.6 billion
The top dealer in the 2020 edition, Discount Tire/America's Tire, posted sales of $4.78 billion at 1,046 locations.
Twenty years ago, five of the largest tire manufacturers collectively accounted for 89.6% of the U.S. and Canada's $22.5 billion in tire sales ($34.4 billion in today's dollars).
Today, the 10 largest tire manufacturers account for 78.7% of the $48 billion in tire sales.
The biggest concern among the industry back then was the ever increasing price of crude oil. The industry survived and grew, and so too will it weather the storm of issues facing the industry today.
Too often, when we put our heads down and work, we fail to see the forest for the trees.
Despite the challenges, and there will be plenty, remember to keep some perspective.