Rubber Product Manufacturers
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 1,300 rubber product manufacturers in the US process natural, synthetic and reclaimed rubber materials into a wide range of rubber products. Products include tires and inner tubes, hoses and belts, fuel bladders, rubber bands and erasers, balloons, haircare products, pacifiers and baby bottle components, floor and car mats, inflatable mattresses and pools, latex foam rubber, roofing membranes, sheathing, and rubber components for machinery.
Regulation and Safety
The industry is highly regulated due to the chemical mixtures and processes used to manufacture rubber products.
Varying Raw Material Costs
Manufacturers face significant fluctuations in the price of synthetic rubber from year to year.
Industry size & Structure
A typical tire manufacturer employs about 604 workers and generates about $250 million annually. A typical tire retreading manufacturer employs 23 workers and generates $6 million annually. A typical hose and belt manufacturer employs 101 workers and generates $28 million annually. A typical manufacturer of mechanical rubber products employs 93 workers and generates $23 million annually.
- The rubber products manufacturing industry consists of 1,300 companies that employ 135,000 workers, and generates $45 billion annually.
- Primary customers include automotive (manufacturers, suppliers, and repair shops), machinery and appliance manufacturers and repair services, aerospace (manufacturers and suppliers), industrial supply distributors, building materials suppliers, and consumer retail.
- The tire manufacturing segment is highly concentrated with the eight largest firms representing 85% of revenue. For the rest of the industry, the top eight firms in each segment represent 30-52% of their segment’s revenue.
- Large companies include Michelin, Goodyear, Bridgestone, Proto Labs, Inc., CTI Industries, Ames Rubber Manufacturing, Warco Biltrite, Passaic Rubber, and Jefferson Rubber Works.
Industry Forecast
Rubber Product Manufacturers Industry Growth
Recent Developments
Nov 30, 2024 - Plateauing Producer Prices
- According to the latest US Bureau of Labor Statistics data, producer prices for rubber product manufacturers stayed flat in September compared to a year ago after rising 3% in the previous September-versus-September annual comparison. Industry producer prices, which kicked off a steep climb in early 2021 and peaked in April 2023, have plateaued. The weakness in pricing power follows a decline in sales by the plastic and rubber products industry, which fell 11.1% year over year in the second quarter but rose 4.5% from Q1, as the manufacturing sector cooled. Employment by makers of rubber products shrank by 2.8% YoY in September, while average industry wages rose 6.2% over the same period to $26.76 per hour, not far from their record high in July, BLS data show.
- The cost of rubber has soared to a 13-year high as extreme weather sharply reduced production in Asia, Reuters reported in November. A series of extreme weather events – including a prolonged drought followed by torrential downpours and a powerful typhoon – in regions that rely on rubber trees for rubber production slammed the industry this year. In September, Typhoon Yagi hit China's Hainan Province damaging almost 40,000 acres of rubber trees in the major source region of Hainan, according to Reuters. That represented about 2.1% of China's total rubber area. Extreme weather “fluctuations can drastically impact the tapping frequency of rubber trees and overall latex production," Farah Miller, the founder of Helixtap, a company that deals with rubber industry data, told Reuters. As of October 2024, the average monthly global price of rubber was $2.63 dollars per kilogram, up from $1.50 two years ago, according to Statista.
- Researchers at Edison Agrosciences are working to develop and commercialize natural rubber made from sunflowers, Rubber World reported in July. Amid rising demand, the US lacks a domestic source of natural rubber. Moreover, the global supply is currently sourced from a disease-susceptible tree species grown primarily in South and East Asia, which is vulnerable to tropical deforestation. The ample US sunflower crop has the potential to produce over 25,000 tons of natural rubber annually. However, the current concentration of rubber in sunflowers is too low for economical extraction. Edison Agrosciences recently closed on a $600,000 seed financing round to support its efforts to increase rubber concentration in each sunflower plant, thereby improving the per-acre yield, Rubber World reports. The funding will be used to advance R&D, increase production capabilities for customer product evaluation, and further develop the supply chain infrastructure to bring the technology to market.
- More than 200 chemical plants across the US – including those producing chloroprene used to make rubber footwear – will be required to curb airborne toxic pollutants under a new regulation announced by the Biden administration, The New York Times reported in April. The new EPA rule has classified chloroprene as a likely carcinogen. Most of the plants affected by the rule are in Texas, Louisiana and elsewhere along the Gulf Coast and in the Ohio River Valley and West Virginia, according to NYT. Other toxic chemicals covered by the rule include 1,3-butadiene, which is used to make synthetic rubber and plastics, and ethylene dichloride and vinyl chloride, both of which are used to make a variety of plastics and vinyl products. The EPA said that the rule would cut toxic pollutants by 6,200 tons annually and reduce emissions of ethylene oxide and chloroprene by 80%.
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