AKRON — Those looking for a bright spot in an otherwise drab forecast for the U.S. replacement market are going to have look far and wide, if the available market statistics are any indication.
According to the most recent U.S. Tire Manufacturers Association (USTMA) forecast, aftermarket shipments are projected to fall short of the trade group's earlier forecast — as well as 2022 shipment levels — by more than 10 million units or 3.6%.
At the same time, imports of passenger, light truck and medium truck/bus tires are off by double-digits for both the second quarter and first half, as the wholesale sector works to draw down inventories bloated by over-ordering during the worst of the supply-chain crisis in 2021-22.
Hardest hit is the commercial truck/bus sector, where the USTMA said it expects shipments this year to not surpass 22.4 million units, which would be 11.1% lower than the forecast from February, as well as nearly 16% below the 2022 shipment total.
The import totals echo that situation: medium truck/bus tire imports fell 41% during the second quarter, to 3.96 million units, and are down 25%, to 8.43 million units, through six months, according to the latest data from the Commerce Department.
Replacement market light truck tire shipments should reach 35.9 million units this year, the USTMA said, down 5.2% from the February forecast and 3.6% from the 2022 total.
Imports of light-truck tires fell 26.3% during the quarter to 7.53 million units and 24.5% for the half-year to 14.4 million units.
For passenger tires, the USTMA projects that replacement shipments this year will reach 210.5 million units, down 2.5% from the February forecast and 1.5% behind the 2022 total. While the new projected total is down versus 2021 and 2020, it's 18.5% ahead of the total from 2019, the last full year before the onset of the COVID-19 pandemic, the USTMA data show.
Imports of passenger tires fell 12.3% in the quarter to 40.7 million units and 11.6% in the six months to 76.4 million units.
The USTMA did not offer perspective on the reasons for the diminished forecast, but a number of tire makers commented on the half-year performance and shared their expectations for the rest of the year.
While noting consumer tire replacement market sales in North America slumped by as much a 8% in the first half, Continental A.G. said it expects sales in the second half to be on par with the same period last year, thanks to rising sales in the fourth quarter. That would leave full-year sales down 1% to 3%.
On the commercial side, Conti said it expects full-year sales of truck/bus tires to be down by 8% to 10% from 2022 after falling 11% in the first half, in part due to advance purchases by dealers during the year-ago period.
Group Michelin noted that replacement market demand for consumer tires in North America contracted in the first half by 6% versus 2022 due to "comparatives that remained especially unfavorable throughout the period."
Replacement market demand for commercial tires fell even more sharply, down 11% for the half with a 19% decline during the second quarter, Michelin said.
Goodyear said it expects consumer replacement market volumes in the third quarter to be flat or up slightly versus the 2022 period, while commercial sector shipments will continue to be impacted by distribution channel destocking.
It should be noted that the USTMA and tire maker shipment and sales data are sell-in numbers — i.e., shipments to the retail and/or wholesale channels. In its second-quarter earnings report, Goodyear noted that sell-out — sales by the retail channel to end-users — was up 2% during the quarter.
Looking at the import situation, the shipment declines were nearly universal.
In the passenger tire sector, only Vietnam and Cambodia showed improvements in the quarter over the same period a year ago. Imports from Vietnam were up 17.7% while Cambodia's shipments went from zero a year ago to 1.06 million this year.
In light truck tires, Cambodia was the only nation to show an improvement over a year ago, while in medium/truck bus tires Spain (up 50%) was the only nation to buck the downward trend.
Thailand continues as the No. 1 source of imported tires in all three of the major categories, followed by Mexico in the passenger tire category, Canada in light truck tires and Japan in medium truck/bus.
The average value of imported passenger and medium truck tires slipped slightly, while that for light truck tires rose slightly.
On the original equipment side of the ledger, the USTMA's revised forecast shows shipments of 43.9 million passenger tires, or 3.1% ahead of the earlier forecast as well as 5.6% ahead of the 2022 total.
The forecast for OE light truck tire shipments is for 6.4 million units, down 3.2% from the February projection and 0.5% from the 2022 total.
Medium/heavy truck tire shipments for OE are up 1.6% over the February forecast and on par with 2022 shipments.
Overall, the USTMA projects shipments of passenger, light and medium truck tires of 325.4 million units, down 2.7% from the February forecast and 2% from the 2022 total.