Oil prices determine possibility of tire shipment rebound, says Ludwig
"The U.S. is not alone in seeing very weak tire volume. Europe is also feeling the impact of higher gasoline costs and pressure on consumer spending," reports Saul Ludwig in the October installment of the "Ludwig Report" in Modern Tire Dealer magazine.
"In July, replacement tire shipments there fell about 4%, but in August they tumbled by 10%. Winter tire shipments in Europe are off 35% so far in 2008.
"Back to the U.S., as I look to 2009, my early view is that replacement tire sales will see a modest rebound of about 3% assuming, of course, that there is not a resurgence in oil prices and gasoline is no higher than $4 per gallon," Ludwig predicts.
Ludwig is a managing director with KeyBanc Capital Markets Inc. based in Cleveland, Ohio. Look for the full "Ludwig Report" in the October issue of Modern Tire Dealer magazine.