Pirelli & Cie SpA says its tire volumes were up 2.3% in the first quarter of 2024, and that its performance in the replacement channel beat that of the overall market. The tiremaker called it “a solid operating performance.”
For the period, Pirelli recorded revenues of $1.829 billion, down slightly from $1.848 billion in 2023. The company achieved net profit of $108.348 million, down from $ 125.0 million in the first quarter of 2023.
Price/mix was beneficial to the tune of 2.3%.
During the quarter, Pirelli says it saw greater strengthening in its high value business, especially in cars with tires larger than 19 inches and other specialties. The tiremaker says it achieved volume growth of 6.8%, while the market was at 6.5% Pirelli said it earned market share in the replacement channel across regions with volumes up 11.4% compared to a market that was up 10.1%.
Pirelli says its original equipment tire volumes of sizes 18 inches and larger were slightly behind that of the market’s. Pirelli was up 0.9%, while the market was up 1.5%.
During the quarter, Pirelli obtained 84 new technical homologations (OE fitments), and says those are mostly with tires 19 inches and larger.
North American tire trends
In the first quarter, Pirelli says the North American replacement tire market was up 6% year-over-year, while OE was up 2% year-over-year. Combined, replacement and OE were up 5% compared to the previous year.
The replacement market for tires at least 18 inches was up 10%, while sizes 17 inches and smaller were up 4% year-over-year in North America.
Tire size outlook
Pirelli is one of several tiremakers who note the growth and popularity of larger-sized tires in their sales reports. Here’s how Pirelli sees global tire demand, with some general tire size guidelines:
OE tires, 18 inches and larger: The outlook is for “mid single-digit growth,” driven by performance in the Asia Pacific region and North America.
Replacement tires, 18 inches and larger: The expectation is for “mid/high single digit” performance across the regions.
Tires 17 inches and smaller: “Flat demand year over year, with a weaker OE market and a substantially flat replacement.”
Pirelli says, “We expect to outperform the car 18-inch and larger market, especially on the replacement channel.”
Targets for 2024
Pirelli’s guidance remains unchanged from March, when it said it expects full-year revenues to range between $7.162-$7.379 billion. In 2023 the company recorded 6.65 billion euros in sales.
And though Pirelli says this would have no effect on the company’s financial targets for the year, the board of directors has approved an agreement to review certain terms “for the licensing of technology and brand names in existence between the Pirelli Group and Aeolus Tire Co. Ltd. and Prometeon Tyre Group Srl, aimed at, among other things, a remodulation of the durations and amount of royalties due.” Pirelli said these agreements are part of a larger negotiation tied to other agreements with both parties when the industrial business was separated.
