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Now may be the best time to buy tires, says Ludwig

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"Based on my monthly survey of dealers, I estimate that retail demand for replacement consumer tires fell about 5% during the first five months of 2009," saysSaul Ludwig in the July installment of the "Ludwig Report" in Modern Tire Dealer magazine.

"On the other hand, wholesale shipments (manufacturers to dealers) fell by a whopping 13% as dealers cut inventories.

"That trend cannot continue. As I look to 2H09, I expect wholesale shipments of consumer replacement tires to increase as noted below.

         U.S. unit shipments (millions of units)

                          1H          2H              Full year

2008                 114        109            223

2009                   99         111 est.    210 est.

% change        -13%      +2%           -6%

"With oil having moved higher in the last two months, I expect marketing specials to diminish. So the best time for dealers to buy tires may be right now."

Ludwig is a managing director with KeyBanc Capital Markets Inc., based in Cleveland, Ohio. Look for the full "Ludwig Report" in the latest issue of Modern Tire Dealer magazine.

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