Tire replacement market tops pre-pandemic levels

AKRON, Ohio — One year removed from the deep market slumps of 2020, the North American tire industry is humming along again at record or near-record levels in most aftermarket sectors.

According to new data from the U.S. Tire Manufacturers Association (USTMA) and Tire and Rubber Association of Canada (TRAC), replacement market tire shipments grew by double-digits in all the sectors monitored, recovering to or exceeding pre-pandemic levels.

• This article appears in the Feb. 28 print edition of Tire Business.

Original equipment tire shipments, on the other hand, while up over 2020, continue to lag the pre-pandemic 2019 figures, the USTMA data show, as North American vehicle production fell for the fourth straight year.

At the same time, imports of tires in the major consumer and commercial categories bounced back from 2020 to record levels, despite the global supply-chain issues that dominated news coverage throughout 2021.

Domestic tire production, while up in all key categories, fell short of regaining pre-pandemic levels in passenger and medium truck/bus tires, the USTMA data show.

U.S. passenger tire production, which fell in 2020 to its lowest level since the 1990s, was up 10.3% over 2020 but still fell 16 million units shy of the 2019 output.

Light truck and medium truck/bus tire production was up 25% and 15.7%, respectively, to 26.1 million and 13.5 million units. As such, light truck tire output exceeded 2019 production by 1.6% while truck/bus tire production fell 8% short of matching the 2019 output, the data show.

Replacement market shipments

• Passenger, up 10.3% (20.9 million units) to 224.8 million units;
• Light truck, up 16.8% (5.67 million units) to 38.5 million units; and
• Medium & heavy truck/bus, up 19.3% (3.7 million units) to 22.8 million units;

Original equipment shipments 

• Passenger, up 0.7% (243,000 units) to 37.4 million units;
• Light truck, up 4.9% (262,000 units) to 5.6 million units; and
• Medium & heavy truck/bus, up 25% (1.18 million units) to 5.9 million units.

 Data available for purchase in the Tire Business Data Store.

In Canada, replacement market shipments rebounded strongly from 2020, posting unit sales growth of 18.5% for passenger tires, 28.5% for light truck tires and 31.8% for medium truck/bus tires, according to TRAC data. Light and medium truck tire shipments returned to pre-pandemic levels, while demand for passenger tires was still below shipment levels of 2018 and 2019.

At the same time, imports of tires into the U.S. were up by double digits across the board, according to the year-end trade date from the U.S. Department of Commerce:

• Passenger tire imports, up 10.4% (14.7 million units) to 155.9 million units;
• Light truck tire imports, up 19.8% (5.53 million units) to 33.4 million units; and
• Medium truck/bus tire imports, up 31.8% (4.18 million units) to 17.3 million units.

Thailand continues to be the No. 1 source of imported tires for the U.S., being ranked first in the three main categories by comfortable margins over the No. 2 exporting nations despite reduced shipments last year versus 2020, the Commerce Department data show.

Mexico was the rising star among trading nations, registering 52.8% and 55.9% gains in exports to the U.S in passenger and light truck tires, respectively. As such, Mexico is now the No. 2 foreign source of imported passenger tires and No.3 light truck tire supplying nation.

Taiwan — whose tire makers were hit the hardest by the U.S.'s imposition of elevated import duties early in 2021 — was the most notable at the other end of the spectrum, shipping 56.5% fewer passenger and 59.4% fewer light truck tires to the U.S. last year versus 2020.

Other key market developments of the past year worth noting:

• Demand for high-performance tires grew at a rate twice that of general demand growth. Aftermarket shipments of tires H-rated and higher jumped 22% last year to a record 122.4 million units. That volume of shipments represents over half of all U.S. shipments (54.4%) for the first time, the USTMA data show.

As such, aftermarket demand for high performance tires as a percentage of shipments is approaching that for original equipment (60%).

• Shipments of winter/traction tires increased slightly (2.6%) last year, but the market penetration fell to 1.6% of all passenger tire shipments. By contrast, winter tires represent over 35% of aftermarket car tire shipments in Canada.

The market rebound was reflected in the tire manufacturers' business in 2021. The estimated value of the North American tire market was up nearly 22% last year to just shy of $50 billion as most of the major players in the sector reported high double-digit sales growth.

• Michelin Group retained its No. 1 status among tire companies in North America by a slim margin over Bridgestone Corp. Goodyear's acquisition of Cooper Tire & Rubber Co. pulls it closer to the top-ranked duo, but it still will be No. 3 even with a full year's worth of Cooper's sales included.

Other key findings in the 2022 Market Data Book:

• Walmart Stores Inc. and Bridgestone Retail Operations retained their roles as the largest retail tire businesses based on store counts, while Discount Tire/America's Tire is securely ensconced as the No. 1 retailer based on sales revenue.
• National dealerships (those 40 or more outlets in three geographical regions) accounted for over 42% of passenger and light truck shipments in the U.S. last year, according to USTMA data, down slightly from a year ago.
• After suffering double-digit declines in 2020, sales of consumer vehicles (passenger cars, minivans, SUVs/CUVs, light trucks, delivery vans, etc.) rebounded last year in both the U.S. and Canada, although overall sales still lag behind the peaks of the years prior to 2019.
• Imported vehicles (those from outside of North America) represented 25% of sales in the U.S. last year, up from 24% the year before.
• The U.S. Department of Transportation issued 19 new tire factory identification codes to companies worldwide.