A slowing economy could forecast lower truck tire pricing, says Ludwig
"With gasoline returning to the $3/gallon level, we could once again see sluggish consumer tire sales as the spring/summer driving season approaches similar to what happened in mid-2006," notes tire industry analyst Saul Ludwig in the May installment of the "Ludwig Report" in Modern Tire Dealer magazine.
"As to truck tires, a slowing economy -- coupled with an ample supply due to a sharp downturn at OE -- could presage softer truck tire pricing ahead.
"On balance," says Ludwig, "dealers do not need to build excess inventories, as tire supply should be ample throughout this year, especially since Goodyear Tire & Rubber Co. is now back to full production following its strike in 4Q06."
Ludwig is a managing director with KeyBanc Capital Markets, a division of McDonald Investments Inc. based in Cleveland, Ohio. Look for the full "Ludwig Report" in the May issue of Modern Tire Dealer magazine.