ORLANDO, Fla.—Tire dealers have to be prepared for market fluctuations and changing products, mindful of government regulations and extremely diligent about customer service if they are to succeed in off-the-road tire sales, panelists told an audience at the International Tire Exhibition & Conference in Orlando, Fla., Aug. 20-22.
The movement of the OTR tire market has resembled a bell curve in recent years, according to Mike Baggett, national OTR sales manager for Yokohama Tire Corp.
“In 2009, there was very low demand in the face of the banking and Wall Street crisis,” he said. “By 2011, there was high demand, low inventories and allocations. You had to make sure your end-users and dealers were taken care of.
“Demand started to decrease in 2012, and by 2013 there was low demand. This year there is an increase in supply, overstock and a buyer's market.”
Mining is suffering a decline now, with no end in sight, according to Baggett. Coal prices are the lowest they have ever been, he said, and gold has lost a third of its peak value, from $2,000 to $1,300 an ounce.
The OTR business is always hard to predict, Baggett said. In 2000, he said, he predicted that bias-ply OTR tires were here to stay and that giant mining and construction trucks would never exceed 200 tons.
Now, he said, trucks above 200 tons are common, and radials comprise 65 percent of the OTR tire market.
Small OTR tires are enjoying an upswing now, according to Aaron Murphy, vice president of CMA L.L.C./Double Coin.
“Small OTR tires have the right production flow and the right inventory levels, and sales are strong,” he said. Radial and bias tires sized 24 and 25 inches now represent 67 percent of the units sold, he said.