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 10,900 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 10,900 firms that employ about 187,000 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) and Sumitomo Corporation of Americas (TBC Corporation - Tire Kingdom, Big O). Some large tire manufacturers are vertically-integrated and have retail operations.
Industry Forecast
Tire Dealers Industry Growth
Recent Developments
Mar 22, 2024 - Wages, Employment Up
- Employment and wages at tire dealers increased at the end of 2023 compared to the previous year, according to the Bureau of Labor Statistics (BLS). Employment by tire dealers was up 6.5% in December year over year while average wages increased 2.3%. Producer prices for tire dealers increased slightly at the end of 2023 compared to the previous year, per the BLS. The total vehicle miles traveled in the US remained mostly unchanged in January 2024 compared to a year ago, according to the US Department of Transportation’s Federal Highway Administration. Additionally, consumer spending levels showed a slight upward trend in the first nine months of 2023, according to personal consumption expenditures data from the Bureau of Economic Analysis.
- According to the Institute for Supply Management, the ISM Services PMI showed growth in February 2024, marking the 14th consecutive month that the index remained above the baseline for growth. The report tracked the performance of 18 service sectors, out of which 14 showed gains in February. These sectors include Construction; Retail Trade; Public Administration; Health Care & Social Assistance; Accommodation & Food Services; Utilities; Professional, Scientific & Technical Services; Management of Companies & Support Services; Finance & Insurance; Agriculture, Forestry, Fishing & Hunting; Wholesale Trade; Information; Educational Services; and Transportation & Warehousing. Three sectors reported a decrease in February, including Arts, Entertainment & Recreation; Mining; and Real Estate, Rental & Leasing. The Services PMI report is based on data from purchasing and supply executives nationwide compiled by the ISM.
- The US Tire Manufacturers Association (USTMA) has projected lower tire shipments in 2023, according to American Recycler News. Total tire shipments for 2023 are expected to total 327.7 million units, a reduction from the 332 million units predicted in March and lower than the 332 million tires shipped in 2022. The original equipment shipments are projected to have a total increase of 3 million units, with passenger tires expected to grow by 7.9% and light truck and truck tire shipments to fall by 4% and 1.3%, respectively. Replacement tire shipments are projected to have a total decline of 7.3 million units, with mixed results from replacement passenger (0.2%), light truck (-5.6), and truck (-21.3) shipments.
- Consumer confidence levels fell in February 2024 after increasing for three consecutive months, according to data from The Conference Board. The Conference Board’s consumer confidence index fell to 106.7 in February 2024 from 110.9 in January 2024. According to Dana Peterson, Chief Economist at The Conference Board, “The decline in consumer confidence in February interrupted a three-month rise, reflecting persistent uncertainty about the US economy. The drop in confidence was broad-based, affecting all income groups except households earning less than $15,000 and those earning more than $125,000.” Peterson added that the decline in consumer confidence was largest in householders over 55 and those under 35. Plans to purchase homes, autos, and large appliances decreased slightly on a six-month basis.
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