This year has been characterized by soft retail demand, high tire prices forced by surging raw materials, poor fill rates early in the year and new leaders of North American operations at both Goodyear and Cooper Tire.

Tags: Ludwig, Ludwig Report, Saul Ludwig

Uncertain European economies, the U.S. debt crisis, Congressional gridlock, 9.2% unemployment and a slumping stock market are enough to explain why consumers are putting off big ticket purchases as long as possible. Add to that, a $1,000 bill for four tires, alignment and a few other suggested repairs further shocks your customers.

Tags: Ludwig Report, Saul Ludwig

Last month I warned about softer retail sales and based on my dealer contacts, business in May and thus far in June was especially challenging. Weak consumer tire shipments (May 2011 vs. May 2010 was down 12%) allowed manufacturers to build their inventories so fill rates are getting better.

Tags: Ludwig Report, Saul Ludwig

Besides my regular channel checks with tire dealers and manufacturers, I speak often with suppliers of raw materials including producers of synthetic rubber, carbon black, steel cord and polyester. Their message is that they cannot keep up with demand from tire manufacturers.

Tags: Ludwig Report, Saul Ludwig

As expected, wholesale tire prices are going up as much as 8% in March as raw materials took a big jump up in January 2011. While natural rubber is the most visible as its climb is unprecedented in history, other materials including synthetic rubber, carbon black, steel and chemicals also are up.

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