Commercial Truck Tires Procurement Category Market Research Report from IBISWorld has Been Updated

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High supply chain risk, a lack of substitute goods and a high market share concentration are the primary risk factors affecting buyers of commercial truck tires; these three factors greatly reduce buyer negotiating leverage while giving suppliers control over market pricing. For these reasons and to help procurement professionals make better buying decisions faster, business intelligence firm IBISWorld has updated a report on the procurement of Commercial Truck Tires in its growing collection of procurement category market research reports.

IBISWorld procurement market research
Input costs are forecast to rise or level out, and coupled with high demand, tire prices are expected to accelerate somewhat.

The commercial truck tires market has a buyer power score of 2.5 out of 5, which indicates a severe lack of buyer power. High supply chain risk, a lack of substitute goods and a high market share concentration are the primary risk factors affecting buyers. These three factors greatly reduce buyer negotiating leverage while giving suppliers control over market pricing. However, buyers can gain some negotiating power back by taking advantage of the low level of specialization and minimal switching costs in this market. “Overall, buyers are at a distinct disadvantage to suppliers when purchasing truck tires, but with prices increasing modestly, there is still some opportunity for buyers to gain good deals,” according to IBISWorld business research analyst Scott Winters.

The supply chain for commercial truck tires is a primary source of risk for buyers. Natural rubber and steel are both heavily used in tire manufacturing, and these commodities display extremely high price volatility year after year. Volatility stems from a variety of factors, but unstable global supply combined with high demand is often the cause. Suppliers, in an attempt to protect their profit margins, will pass on the cost of these materials directly to buyers, resulting in volatile tire prices. Another major source of risk in the commercial truck tires market is the lack of substitute goods. Without viable substitutes for buyers to use as leverage, suppliers can keep prices high. Additionally, around 30 manufacturers make all major tire brands. High market share concentration allows the largest suppliers to sway prices in their favor, ultimately hurting buyers.

“Luckily for buyers, there are a few strategies that can improve negotiating power,” says Winters. Buyers can choose from a variety of standard truck tires rather than purchasing a customized product, fostering a high level of comparability between suppliers. Moreover, switching suppliers requires minimal additional expenditure. Not only do low switching costs save money during the switching process, but the ability to easily switch suppliers also pressures the current supplier to perform to a high standard. Overall, buyers can use these strategies to gain some negotiating power despite unfavorable market factors. Major vendors include Yokohama Tire Corporation, Goodyear Tire & Rubber Company, Bridgestone Corporation and Michelin. For more information, visit IBISWorld’s Commercial Truck Tires procurement category market research report page.

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IBISWorld Procurement Report Key Topics

This report is intended to assist buyers of commercial truck tires. Commercial truck tires are installed on large commercial trucks and trailers. These trucks are typically classified in classes six, seven and eight. Manufacturers include many of the largest global tire suppliers and some smaller regional suppliers. This report includes tires intended to be installed on new vehicles as well as replacement tires. Although recycled (retreaded) tires are prevalent in this market, this report focuses specifically on new tires. Moreover, this report excludes tires for cars, light trucks and heavy-duty off-road vehicles.

  • Executive Summary
  • Pricing Environment

-- Price Fundamentals
-- Benchmark Price
-- Pricing Model
-- Price Drivers
-- Recent Price Trend
-- Price Forecast

  • Product Characteristics

-- Product Life Cycle
-- Total Cost of Ownership
-- Product Specialization
-- Substitute Goods
-- Regulation
-- Quality Control

  • Supply Chain & Vendors

-- Supply Chain Dynamics
-- Supply Chain Risk
-- Imports
-- Competitive Environment
-- Market Share Concentration
-- Market Profitability
-- Switching Costs

  • Purchasing Process

-- Buying Basics
-- Buying Lead Time
-- Selection Process
-- Key RFP Elements

  • Negotiation Questions
  • Buyer Power Factors
  • Key Statistics

About IBISWorld Inc.
IBISWorld is one of the world's leading publishers of business intelligence, specializing in Industry research and Procurement research. Since 1971, IBISWorld has provided thoroughly researched, accurate and current business information. With an extensive online portfolio, valued for its depth and scope, IBISWorld’s procurement research reports equip clients with the insight necessary to make better purchasing decisions, faster. Headquartered in Los Angeles, IBISWorld Procurement serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit or call 1-800-330-3772.

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Gavin Smith
IBISWorld Inc.
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