Cooper to raise prices again on July 1
In a conference call to discuss its first quarter financial results, Cooper Tire & Rubber Co. executives reported the company will have another price increase in North America affective July 1 of up to 8%.
This follows a price hike the company put in place in February. Both increases are necessary to counter record high prices of rubber, oil-based products and steel, the company notes.
Cooper tire brand product mix has improved, especially in the premium touring tire and light truck tire lines, the company notes. Plants are being run full-out to increase inventory to meet the needs of seasonal sales from June to November.
Fill rates in the first quarter were close to 92%, and the company wants to hold it there or higher.
The company made strategic decisions to eliminate some non-profitable lines to attack complexities and decrease exposure from non-moving lines.
Roy Armes, Cooper chariman, CEO and president, says that although the company has faced headwinds -- including soft consumer demand -- Cooper will make progress due to excellent company liquidity and improvements in product portfolios. The company has made good progress toward reaching its goals, and plans to adapt its plans to the changing economic atmosphere, he says.
Armes says industry data shows consumers are driving fewer miles due to the increase in fuel costs, they are driving more cars versus trucks and SUVs, and are looking at lower price point tires as a "natural reaction to the economic slowdown."