Global demand and improved downstream markets will bolster revenue for Heavy-Duty OTR Tire Manufacturing
Los Angeles, CA (PRWEB) December 02, 2011
The Heavy-Duty OTR Tire Manufacturing industry will continue to gain traction over the next five years, according to IBISWord, the nation’s largest publisher of industry market research. The construction sector's recovery and continued growth among agriculture and mining markets will drive demand for OTR replacement tires and new equipment purchases, which will spur demand from OEMs. As such, industry revenue is anticipated to increase at an average annualized rate of 2.7% to $1.3 billion over the five years to 2016, with revenue forecast to grow 4.6% to $1.21 billion in 2012.For this reason, industry research firm IBISWorld has added a report on the Heavy-Duty OTR Tire Manufacturing industry to its growing Mining Services report collection.
The Heavy-Duty Tire industry is rolling its way to a recovery. Revenue is expected to increase at an average rate of 0.1% per year to $1.2 billion in the five years to 2011, with revenue growing 3.6% in 2011. Increased demand for construction, mining and agricultural machinery manufacturing and tire replacement for those products has driven the industry's recovery. Growing demand for off-the-road (OTR) tires in developing nations has also supported the industry's growth.
The construction, mining and agriculture sectors primarily purchase this type of equipment and OTR tires. In the years before the economic downturn, the Tractors and Agricultural Machinery Manufacturing industry (IBISWorld report 33311) performed strongly, with high food prices boosting farm income, enabling them to purchase more equipment and OTR tire replacements. Then, the recession abruptly ended this growth. Construction equipment manufacturers also felt the pinch from the recession. Construction projects were shelved as the housing bubble burst. These factors resulted in fewer OTR tire purchases from construction machinery manufacturers and less demand for replacements. Demand from the Mining, Oil and Gas Machinery Manufacturing industry (33313) has risen over the five years to 2011, underpinned by booming global demand for mineral and energy commodities. This trend resulted in strong demand for machinery and equipment and the OTR tires sold along with them. Rapid growth in developing countries and the soaring mining industries in North and South America have resulted in exports demanding a significant portion of domestic production.
The next five years are set to be full of green lights for the tire industry and will benefit major players including Bridgestone Corporation, Titan International and Compagnie Generale des Etablissements Michelin. The US economy will gain strength and downstream and export markets will surge ahead, driving demand from original equipment manufacturers (OEM) and for replacement OTR tires. As a result of these trends, revenue is set to grow 2.7% annually to total $1.3 billion in the five years to 2016, with growth of 4.6% in 2012. “During the next five years, rising farm incomes will generate moderate demand for agricultural machinery and corresponding purchases of OTR tires,” says Samadi. Among the construction market, stronger construction activity will encourage companies to invest in new machinery and equipment and OTR tires. Finally, rising commodity prices will cause customers in the mining, oil and gas sectors to resume spending on machinery and equipment and OTR replacement tires.
For more information, including latest trends, statistics, analysis and market share information, download the full report from IBISWorld on the Heavy-Duty Tire Manufacturing industry
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