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Replacement Tires

Les Schwab Recalls Retread Truck Tires

Les Schwab is recalling 41,336 steel-belted radial retread truck tires because the vulcanizing compound used during the process may not have been completely cured, which can lead to incomplete adhesion of the tread to the tire casing.

Replacement Tire Costs Increase 5-10%

For the past four years, tire costs have been stable. But, new cost pressures have emerged in 2017, due to higher prices for the commodities used to manufacture tires and the trend to larger diameter, more expensive tires.

Higher Commodity Prices Put Upward Pressure on Tire Costs

For the past four years, tire costs have been stable. But new cost pressures have emerged in 2017, primarily with higher prices for commodities used to manufacture tires and the trend to larger diameter, more expensive, tires.

Fleet Replacement Tire Costs Decline

Passenger car tire prices are anticipated to increase in CY-2017. The key factors influencing future replacement tire prices are the cost of materials and the continuing trend to larger diameter and unique tire sizes.

Stable Commodity Prices Keep Replacement Tire Costs Flat

Replacement tire prices for CY-2016 are flat because of less volatility in the global prices of commodities used to manufacture tires, namely oil, rubber, and steel. The forecast is for a continuation of price stability into CY-2017.

Fleet Maintenance Tire Costs Remain Flat

The current tire cost stability may be short lived. The forecast is for a 2- to 3-percent cost increase in CY-2016 driven by unique tire sizes, run-flats, and limited replacement tire availability for certain vehicles.

Operating Costs Flat for Third Consecutive Year

Calendar-year 2015 marks the third consecutive year that fleet operating costs have remained stable compared to the past three years, primarily due to the continuing softness in gasoline and diesel prices. Replacement tires, the second highest operating cost, were stable due to the ongoing softness in commodity prices, primarily rubber and oil, while increased maintenance intervals contributed to lower maintenance costs for fleets. The forecast is more of the same for CY-2016.

Impact of Chinese Truck Tires on Fleet Aftermarket

One factor driving the deluge of Chinese exports of replacement truck tires to the U.S. is China's immense tire production overcapacity. In 2015, China manufactured 120 million tires, with an overcapacity rate of almost 25 percent. The influx of Chinese truck tires is also having a detrimental effect on the tire retreading industry, because many of these “bargain” tires have only one life because they cannot be retreaded.

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