Despite the complications of doing business in the COVID-19 pandemic, 2021 was a stellar year for tire makers.
Sales from the Top 75 global tire makers increased nearly 13% over 2020 and more than 6% from 2019.
For our annual Global Tire Report Top 75 ranking, Tire Business rates the tire makers based on revenue from the sale of tires they have manufactured in order to achieve a more equitable apples-to-apples comparison. Excluded are items such as third-party sales of steel cord, synthetic rubber or carbon black, as well as estimates for non-tire items such as auto-service-related revenue at company-owned retail stores.
Group Michelin topped our Global Tire Report, now in its 37th year, for the third straight time, with estimated global tire-manufacturing revenue of $26.3 billion. Bridgestone Corp. was second again with $22.2 billion. Goodyear, Continental A.G. and Sumitomo Rubber Industries Ltd. rounded out our Top 5 manufacturers.
Goodyear, it should be noted, has climbed closer to Michelin and Bridgestone with the acquisition of Cooper Tire and Rubber — revenue jumped 41.9% in 2021 compared to 2020.
2021 was a good year for the tire industry. Can you imagine what revenue would have looked like had tariffs and freight not taken a huge bite out of the apple?
This year is shaping up to be one of growth for the tire industry, though muted compared with record highs in 2021. It's 2023 that really has us scratching our heads though, as spending is trending down and several signs point to a recession.
The headwinds — or as we might say, treadwinds — are swirling for what the future might hold. A number of manufacturers have filed appeals to get U.S. import tariffs for countervailing and antidumping lowered, and there is an optimistic tone among them that individual tariffs will be lowered.
The supply chain still is kind of a mess, but the lag times are getting shorter, though this may be a result more of decreased demand than actual improvements. But, one positive of a dip in demand may be that ridiculously high freight prices will come back down to normal — as a commercial market should dictate.
The huge demand from the middle of 2020 throughout 2021 meant a lot of orders, and supply chain delays have meant some of those came in too late. This is especially true for those buying value-tier brands they might not normally stock.
Dealers ordered them to meet the demand, the shipments showed up too late, and now a lot of units are sitting in warehouses taking up space. On top of that, those "cheap" tires were bought for a high price, and as the market cools, so does their value.
Tire service and repair shops had a great 2021 as well, and this year is looking just as good. But those industry winds are swirling. While service is up, thanks in large part to the chip shortage and the scarcity and price of new vehicles, forcing drivers to hold on to their vehicles longer, there is some trepidation that a recession may ruin a good thing.
There will be challenges for the industry — new and old — but the industry knows where it's heading and surely will find the wind to take it there.