Last month I wrote that due to sharply lower raw material costs during 4Q11, I would not expect to see any further tire price hikes any time soon. Unfortunately, that was a wrong call because predictability of future raw material prices is all but impossible.

Tags: Ludwig Report, Raw material costs, Saul Ludwig, Tire prices

I made my annual pilgrimage to the SEMA Show in November. With only a few exceptions, almost every tire dealer I spoke with said: a) business remains challenging, and b) they plan to buy very cautiously in the coming months.

Tags: Ludwig Report, Saul Ludwig

The challenge of selling big ticket products in today’s economic climate is indeed daunting, and to boot, with most tire companies just having announced a new round of price hikes, your job won’t get any easier.

Tags: Ludwig Report, Saul Ludwig, Tire Sales

The U.S. consumer is stretched and purchases that can be postponed are being put off. My survey of tire dealers across the country point to slow sales of consumer tires with many dealers reporting comp store tire volume declines of more than 5% in June with not much improvement seen in July.

Tags: Inventory, Ludwig Report, Saul Ludwig

Last month I commented that at $4 a gallon for gasoline, there would likely be some back-off in driving leading to softer tire sales. Based on contacts with dealers throughout the country, retail tire sales have been weak since April.

Tags: Ludwig Report, Saul Ludwig

As I write this comment on March 22, the stock market — often a leading indicator — is saying good things about the tire industry. Year-to-date as of today, the S&P 500 Index is up 4% but the tire stocks are doing even better.

Tags: Ludwig Report, Saul Ludwig

Gasoline prices seem to be increasing again with prices for regular north of $3 a gallon almost everywhere. While I do not expect driving levels to be meaningfully impacted anytime soon (unless gasoline approaches $4 a gallon), you should cite higher gasoline prices as a way to foster sales of fuel efficient tires.

Tags: Ludwig Report, Saul Ludwig

When the last round of tire price hikes were announced last September/October, natural rubber was selling at about $1.50/lb.; today it is at $2.20/lb. There are approximately four pounds of natural rubber in a consumer tire, so that means the cost of a tire to the manufacturer has increased $2.80 just from natural rubber alone in just three months!

Tags: Ludwig Report, Saul Ludwig