After showing a slight bounce in September, retail tire unit and service sales took a nosedive in October, according to preliminary results from Tire Review’s Dealer Panel. Results show a dramatic drop in sales for October 2008 vs. October of 2007, continuing the drop-off started in mid-September. Clearly, the poor economic news has created a situation where consumers are postponing purchases, which does not bode well as we enter the fourth quarter.
The Dealer Panel reported weak final September numbers in retail tire unit sales vs. the same month last year. Preliminary numbers for October look significantly worse than the same month last year. In October 2007, retail tire unit sales were up 2.5% vs. 2006. This October, unit sales are off nearly 5% vs. 2007. All three product areas are being hard hit, with broadline and HP units running 4% behind October 2007 and LT/SUV tire sales off 5%.
After running behind 2007 levels by 2% from June through September, service sales dropped dramatically in October. Both undercar and underhood sales are now down nearly 5% from 2007.
Dealer Panel member comments provide helpful insights to issues facing tire dealers today:
• The election has everything on hold. The economy is bad, but the price of gas is going down.
• The economy took a turn for the worse and people were not driving or coming in to our location as often. We see a slight improvement though.
• It will be interesting to see how the stock market will affect Ford and GM.
• They bailed out the banks. Bail us out, too.
• Gas prices are down and customers want to know why the tire prices aren’t going down, too.
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