An analysis by the NPD Group shows consumer replacement tire prices increased 13% in 2021, and despite the increase, more expensive tires were more popular with buyers than before the pandemic.
“The tire industry, like many others, is experiencing the effects of a shift in overall consumer behavior as it relates to pricing and demand,” says Nathan Shipley, automotive industry analyst for NPD. “Driving behavior has changed over the past two years but the needs are still there. Consumers are currently focused on getting what they want, while they can, with what is available to them at retail stores.”
NPD says tires that were priced at least $140 per unit “contributed significantly more to sales in 2021 and gained more than 10 unit-share points in the fourth quarter, when compared to 2019.”
In addition to moving more units, NPD says the higher-priced tires sold faster than they did before the pandemic.
When looking at just the fourth quarter, NPD says the average price of passenger car and light truck tires increased by more than 20% in 2021 compared to 2019.
And while the year saw pricing actions from tiremakers in every category, consumers also bought more tires in 2021. And NPD notes that the growth “came almost entirely from full-price tire sales.” Consumers paid full price for their tires 80% of the time in 2021, compared to 73% in 2019, NPD says.
“Consumer behavior has taken a wild ride since the start of the pandemic, and many behavioral changes surrounding recreation and mobility are here to stay, greatly benefiting the automotive aftermarket,” Shipley says. “While factors like miles driven and gasoline consumption are near pre-pandemic levels, the makeup of that consumption looks very different, in terms of where drivers are headed, what they are driving or pulling, and why. While we are keeping a close eye on rising gasoline prices, all of these other factors contribute to a continued bullish outlook for retail sales in the automotive aftermarket.”
