Dealer comments this month continue to reflect increased concerns over the economy and fuel prices. Dealers also mentioned customers are becoming even more price sensitive in their purchases. There is some hopeful news: tire unit and service sales at our panel of more than 100 tire dealers nationwide did show signs of rebounding in July, and same month sales are above last year.
August 2008 Business Barometer
The Tire Review Dealer Panel reported a very weak June in retail passenger tire unit sales vs. June 2007. Final results for June showed unit sales were off 2% year over year, with most of the decline coming in HP/UHP and light truck tire sales. Preliminary numbers for July show a significant uptick in sales in consumer tire purchases, with results extending above July 2007 levels. In the individual tire segments, broadline and HP/UHP unit sales were above 2007 levels, while light truck tire sales barely passed last year’s mark.
Service Dollars
After dropping significantly in June, both undercar and underhood service sales rebounded in July. Preliminary July figures are now running about 1% ahead of 2007 levels. Final June 2008 results, though, were off the mark of last year; undercar service dollar sales were down 1.5% and underhood was down 1.1% compared to June 2007.
Dealer Comments
Dealer Panel member comments provide helpful insights to issues facing tire dealers today:
• Because of price increases our customers are shopping around for the best price.
• When the customer does purchase something, it’s a lower price item.
• The last week of June made up 40% of June’s business.
• Price increases have stuck, but the fill rate is better. There aren’t as many deals to get rid of the inventory.
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