SRI Tire Sales, Profit Are Down

Tire sales at Sumitomo Rubber Industries Ltd. (SRI) were down 1.6% in the first six months of 2025, though the company’s business profit from its tire sales dropped much more dramatically — by 34.7%.

SRI said tire volume was down and the company says profit was reduced due to higher raw material costs in each tire.

Overall company sales totaled $3.9 billion, down 2.5% from the first half of 2024. Tires represent the vast majority of SRI’s sales, though the company also has sports and industrial and other products units. Tire sales totaled more than $3.3 billion, down 1.6% from a year ago.

SRI’s operating profit fell 35.6% in the year-over-year comparison.

The company noted that “there is a risk of the economic downturn which is stemming from the impact of the U.S. tariff policy and ongoing inflation.”

In May SRI had forecasted that the impact of tariffs would be $124.4 million. An updated August forecast now estimates the affect to be $100.2 million.

A closer look at tires

SRI said its domestic (Japan) original equipment tire sales “significantly exceeded the level of the same period,” thanks to a vehicle production slowdown by some automakers a year ago. Volume in the Japanese replacement tire market was slowed compared to the year-ago period due to the discontinuation of low-priced products and a drop in orders for offtake products.

The OE tire business in China was affected by a “significant drop” in sales volume to OEMs in Asia, and particularly China. The company’s flagship replacement tire products “maintained stable sales volume” in China, overcoming “a challenging, competitive environment for international brands, including ours, due to aggressive sales initiatives launched by major Chinese brands.”

The European replacement tire market saw declines from a year ago as SRI said it “focused on profitability amid intensified price competition from other companies, though sales volume of all-season tires, which constitute strong points of our Falken brand, increased through the expansion of the products.”

And in North America, SRI noted that as its “flagship WildPeak series maintained strong sales in North America, overall sales in the region fell below the levels of the same period of the previous fiscal year, due to the high sales volume in the same period a year ago and the continued expansion of market share by competitors’ low-priced products since the second half of last year.”

Tire sales in North America totaled $793 million in the first half of 2025, down 6.2% from the first six months of 2024.

In another note that pertains to the North American market, SRI pointed to its acquisition of the Dunlop brand from Goodyear Tire & Rubber Co. in May. SRI noted that it “has since launched the Dunlop business in North America and Oceania as the first step.” That effort will grow globally.

The company plans to launch “unique (Dunlop) products” for the North American market in January 2026.

Given the market conditions, SRI has adjusted its 2025 financials forecast downward. But it’s notable that the new projected sales figures still represent an increase in overall sales compared to the company’s year-end performance at the close of 2024. The new total sales revenue forecast, and tire sales forecast, are both down 0.4%.