Tire Dealers NAICS 441340

Sep 25, 2025 - Tariffs Are Reshaping the Tire Industry

• Tariffs under the Trump administration have reshaped the tire retail and wholesale industries, forcing companies to adapt quickly to higher costs and unpredictable trade conditions. Global manufacturers like Pirelli and Goodyear report multimillion dollar hits, with Goodyear citing weaker truck tire demand and declining sales. Retailers and wholesalers now face tighter margins as suppliers adjust pricing models to account for fluctuating tariffs, creating uncertainty in long-term planning. Some firms, such as Hankook, are expanding US manufacturing to reduce tariff exposure, a move that could stabilize supply for domestic distributors and retailers. Smaller businesses, however, struggle to absorb steep increases (such as a 50% tariff on Brazilian rubber) without passing costs to consumers. Trade groups note that many companies are treating tariffs as a “new normal” and building them into business strategies.
• American Tire Distributors (ATD), one of the largest wholesale distributors of tires in the US, is finding little relief after reorganizing and emerging from bankruptcy late last year. The tire and wheel aftermarket industry has struggled mightily in the past year - low demand as consumers look for cheaper tires, supply chain disruptions brought on by a US trade war, and increased labor and product costs. Retailers like Advanced Auto Parts are closing hundreds of stores, while distributors like ATD filed for bankruptcy, and still others closed shop altogether. ATD customers continue to drop the distributor, even after it emerged from Chapter 11, spurred by an ill-advised operational expansion after the tire market boomed post-Covid in 2021. ATD had already lost Goodyear in 2018, and now Michelin North America followed suit, pulling popular tire brands such as Michelin, BFGoodrich, and Uniroyal from ATD’s network.

• Tire manufacturers continue to invest in Elective Vehicle (EV)-specific tires despite market ups and downs of demand for EVs, seeing them as a long-term investment in a vehicle class that will only continue to grow. About 300,000 EVs were sold in Q1 2025, per Cox Automotive, an 11.4% year over year jump. Regardless of how prevalent EVs become as auto manufacturers realize their EV conversion plans might have been overly aggressive, there are still millions of EVs on the road, making aftermarket tires a critical niche in EV replacement parts. EV tires are made out of softer rubber and have shallower treads to reduce roll resistance, have stronger sidewalls to support the increased weight of EV batteries, and include foam layers to reduce road noise. EV tires can cost 20%-30% more than regular tires, per Tire Warehouse, and can offer retailers higher margins.
• Demand for aftermarket tires grew across all categories in 2024 according to data from the US Tire Manufacturing Association. Replacement tires for medium trucks and buses had the highest growth with a 12.5% increase over the previous year to 23.4 million units. Light-truck tire shipments grew 7% (36.7 million units) and passenger tires grew 1.3% (222 million tires). Original equipment tires for light trucks also performed well for 2024 (up 13.6%), while medium truck/bus tires and passenger tires both fell 8% and 5.7%, respectively. Overall tire production could fall in 2025 with Bridgestone, Sumitomo, and Goodyear all either closing US plants or cutting back on manufacturing. Those closures are expected to shrink tire output by 4 to 5 million tires.