Tire Dealers
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 11,000 tire dealers in the US sell tires and related services. Companies also sell retreaded or used tires, automotive supplies, and accessories. Tire-related services include mounting, balancing, alignment, tire pressure monitoring, rim reconditioning, wheel refurbishing, and scrap tire disposal. Companies may also perform general automotive maintenance and repair, such as oil changes and brake jobs, or offer roadside assistance services. Some companies also handle tire replacement and related services for corporate fleets.
Competition From Alternative Sources
Tire dealers compete with a variety of alternative sources, including service departments of automobile dealers, auto supply chains and repair shops, manufacturer-owned retail stores, mass merchandisers, warehouse clubs, and Internet dealers.
Complex Inventory Management
To maximize product availability, tire dealers must maintain adequate inventory across numerous brands, sizes, and price points.
Industry size & Structure
The average tire dealer operates out of a single location, employs fewer than 10 workers, and generates about $3 million annually.
- The tire dealer industry consists of about 11,000 firms that employ about 193,000 workers and generate about $33 billion annually.
- The industry is concentrated at the top and fragmented at the bottom. The top four firms account for 33% of industry revenue, while the top 50 firms account for 52% of industry revenue.
- The industry includes national and regional chains, franchises, and independent operators.
- Large companies include Reinalt-Thomas Corporation (Discount Tire), Sumitomo Corporation of Americas (Big O), and Mavis (NTB and Tire Kingdom). Some large tire manufacturers are vertically-integrated and have retail operations.
Industry Forecast
Tire Dealers Industry Growth
Recent Developments
Nov 19, 2024 - Tire Prices, Labor Costs Up
- Consumer prices for tires rose 1.3% in October 2024 compared to a year ago and fell 0.4% from the previous month, according to the Consumer Price Index. Employment and labor costs for tire dealers both increased in September 2024 compared to a year ago, according to the US Bureau of Labor Statistics (BLS). Employment grew 0.7% in September year over year, and average wages for nonsupervisory employees were up 8.1%, reaching $21.91 per hour. Producer inflation for tire dealers increased 1.4% in September 2024 compared to a year ago, according to producer price data from the BLS. Sales for auto parts, accessories, and tire stores grew 6.4%% in July 2024 compared to a year ago and were up 2.5% from a month ago, according to the US Census Bureau.
- A new report from the US Tire Manufacturers Association (USTMA) in Recycling Product News found a 10.5% increase in end-of-life tire utilization in 2023, with 79% of end-of-life tires being consumed by end-use markets. Tires are one of the most recycled and reclaimed products, outperforming materials such as metal, glass, aluminum, plastic, and paper. The top market for end-of-life tires was tire-derived fuel, which accounted for a third of consumption and experienced growth of 11% from 2022. The second largest market for end-of-life tires was ground rubber, which consumed nearly 30% of end-of-life tires and posted an increase of 29% since 2019. Despite the improvements, the organization reports that 48 million end-of-life tires remain in stockpiles. The USTMA has a goal of recycling 100% of end-of-life tires.
- Consumer confidence levels increased in October 2024, improving in all five components of the Consumer Confidence Index, according to The Conference Board. The index was 108.7 in October 2024 from 99.2 in September 2024. Dana Peterson, chief economist at The Conference Board, noted that confidence was the highest among those between the ages of 35 to 54 and those in the income category of over $100,000. Per Peterson, “Consumer confidence recorded the strongest monthly gain since March 2021, but still did not break free of the narrow range that has prevailed over the past two years.” Plans to purchase homes and new cars rose on a six-month average basis.
- The US Tire Manufacturers Association has projected an increase in replacement truck tire shipments in 2024, according to FleetOwner.com. Total replacement truck tires are expected to total 22 million units, a 6.9% increase over 2023. More construction projects, anticipated active truck utilization, and improved spot rates during the second half of the year are expected to support tire sales growth after a sluggish 2023.
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