'Volume has tumbled by a whopping 6.3%,' says Ludwig

Aug. 17, 2006

"I began the year predicting a tepid 0.4% growth in replacement tire volume for 2006, but six months into the year, we see that volume has tumbled by a whopping 6.3%," says industry analyst Saul Ludwig in the August installment of the "Ludwig Report" in Modern Tire Dealer magazine.

"High gasoline prices are taking their toll on consumers' driving habits. Tire production is being scaled back, cost reduction programs are intensifying and, contrary to my initial thinking, 2006 will be a very disappointing year for all tire manufacturers," Ludwig says.

He advises tire dealers to "emphasize service as a way to mitigate soft tire volume."

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 August issue of Modern Tire Dealer magazine.

(To find out how retail tire dealers fared during the first six months, check out results from our exclusive "State of the Industry Survey" in the August issue of MTD.)