Smithers study examines the future of tire supply chains through to 2027

Akron, OH – As they adjust to a market space reshaped by two years of the Covid-19 pandemic, companies across the tire industry are facing direct challenges to the security and cost in their supply chains.
How to negotiate these critical challenges in the short and medium term is examined in detail in a new dedicated industry study – The Impact of Supply Chain Disruption on Tire Manufacturing – from Smithers. Success in this field will be vital to future profitability as global tire sales rebound to reach a forecast $278.6 billion – 2.47 billion units – in 2022.
During its detailed and penetrating survey of all stages of tire manufacturing, sales and distribution, Smithers has identified the following major trends that will define the industry across the next decade:
Sustainability – The push to integrate more recycled and alternative bio-based materials in tire construction will lead to new priorities in material sourcing, manufacturing, and end-of-life disposal. This is creating a premium on designing better low rolling resistance tire compounds, as well as developing commercial applications for recovered tire materials, both within the industry and beyond
Material pricing – The unprecedented shock delivered by the Covid-19 pandemic to tire demand and sales has subsided. The supply of essential raw materials continues to be an immediate priority – as sourcing and pricing of both natural rubber and petrochemical feedstocks remain volatile
Shipping and logistics – There are additional challenges caused by rises and delays in both international shipping and haulage rates. This is leading to an extra focus on security and efficiency in distribution
Online and digital – E-commerce sales are becoming increasingly important, and supply chains need to evolve to respond to this, including the emergence of mobile installation service models
SKUs – Tire OEMs and dealers are diversifying, supplying more specialized tires, especially for the electric vehicle segment, which has been supercharged across 2020-2021. The need to manage inventories with a greater number of stock keeping units (SKUs) is creating an impetus for smarter, more responsive demand planning, intelligent production scheduling and delivery
Workforce – In the short term, a lack of trained labor in US tire manufacturing and distribution facilities is creating a further impediment even as OEMs react to the latest omicron-driven fluctuations in sales. In the longer term it may spur greater investment in automation in tire manufacturing and warehousing
Geopolitical issues – especially the imposition of import tariffs – will continue to influence that market, leading to new decisions on the location of production plants and exports.
Smithers’ exclusive analysis maps each of these impacts across the next five years. This is combined with critical insight into the business models and technology solutions that will enable the tire industry to create more stable, smart, and sustainable supply chains for the future.
The Impact of Supply Chain Disruption on Tire Manufacturing combines Smithers’ unparalleled knowledge of tire markets, production technology, and sales trends to provide a comprehensive business strategy tool for organizations at any stage of the tire industry value chain.