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May 25, 2021 12:41 PM

Replacement tire sales get boost from independent tire dealers

Jim Johnson
Rubber & Plastics News Staff
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    BOWIE, Md.—Independent tire dealers were able to achieve relative success despite the challenges of COVID-19 in 2020.

    Data from research firm Growth from Knowledge (GfK) discussed during a Tire Industry Association webinar May 20 indicates sales were off by just 6.3 percent for all of last year.

    This decrease represents a newsworthy 2020 rebound for a segment that saw sales fall by 40-45 percent early on in the pandemic.

    For a year when the economy was battered by the pandemic, that small of a decrease is good news, said Dave Stevens, GfK's vice president of point-of-sales tracking for tires.

    "Twenty-twenty was not as bad as it could have been," Stevens said during webinar.

    While tire sales for the independents, who represent 54 percent of the overall replacement market, were down overall, there were segments that increased in 2020, he said.

    Light truck tires measuring at least 18 inches grew sales by 12.4 percent last year, GfK said. All-weather tires increased by 3.8 percent and Tier 4 tire sales held flat at a time when the overall market fell. This move to the most economical tire tier came as people faced financial difficulties caused by the pandemic.

    Independent dealers benefited by Walmart's decision to shutter about 2,500 auto centers around the country for months last year. Customers who normally would go to the big box retailer gravitated to independent shops to fill their tire needs, said GfK Neil Portnoy, managing director of GfK's POS tracking team for tires.

    "A lot of the customers migrated into the independent tire channel. Hopefully, they came to our shops and they will continue to do so in the future," he said. "They did more than satisfy the needs of that most price-sensitive customer."

    Many of those customers are price sensitive, which likely helped increase the number of Tier 4 tires sold by independent dealers, GfK said.

    Stevens said there is evidence that the relative strength of Tier 4 tires in 2020 also was at least partially due to the unavailability of more premium offerings due to plant shutdowns during the pandemic. "There was a consumer need to take whatever is convenient and whatever is available."

    Tier 4 tires continued to experience strength for the first quarter of 2021 as well, GfK said, as unit sales were up 13.1 percent year over year. That compares to an overall market increase of 10.1 percent for independents. Light truck tires with rim diameters of at least 18 inches rose 27.9 percent for the quarter and all-weather tires increased 10.1 percent as well.

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