Market Outlook for the OTR Tire Industry
Without question, this has been a tumultuous past year for our industry. In fact, nearly every commercial and business sector dependent on the global supply chain, high production demand and strong economic futures has felt the pain caused by the pandemic. The SARS-CoV-2 (COVID-19) virus has wrecked global havoc on most types of businesses—and the OTR tire sector (and its related fields of construction, agri-business, and the rental equipment marketplace) has been no exception.
The COVID-19 outbreak has penetrated 100 countries around the globe in the nearly past 12 months. The World Health Organization (WHO) has signaled it as an international public health emergency. According to the Global OTR Bias Tire Market Research Report 2020: The global impacts of the coronavirus disease will significantly affect the OTR Bias Tire market results for 2020. The report also signified the COVID-19 affect on the global economy as playing out in “three main ways: by directly affecting production and demand, by creating supply chain and market disruption, and by its financial impact on firms and financial markets.”
Materials procurement for OTR tire fill technology also has had obvious impacts—as has the robustness of commercial and residential construction, which has waned in past months (although many regions of North America have considered building operations to continue as “essential business” support). But the industry, without question, has felt expected decreases in profitability.
Construction Market Data
According to ResearchandMarketing.com, “The U.S. construction industry is expected to contract by 6.5% in real terms in 2020, and 2.0% in 2021. With economic activity expected to contract by as much as 8% this year, and the surge of new COVID-19 cases in the southern and western parts of the US showing no signs of abating, the construction industry is anticipated to be severely hit…”
Rental Equipment Market Data
On the rental equipment side of the OTR field, the American Rental Association (ARA) anticipates a 13 percent decline in equipment and event rental revenue as the year 2020 closes, in comparison with last year (dropping to $48.7 billion in the United States). But according to the latest ARA reporting, this “latest forecast released by the association calls for modest overall growth in 2021, ticking up 0.3 percent to $48.9 billion, before accelerating recovery kicks in with growth of 9.2 percent in 2022, 6.8 percent in 2023 and 4.8 percent in 2024 to reach $59.7 billion.”
What’s Next?
While the industry collectively has experienced a hard-felt reality, as evidenced above, there is positive recovery news waiting on the horizon. According to the Global OTR Bias Tire Market Research Report 2020, the global OTR Bias Tire market size is projected to continue to increase and at a significant CAGR during the forecast period 2021 to 2026. The promising news of two, and not just one, highly viable vaccines in the final stages of preparedness has infused new hope and prospects for positive outcomes in just the past 10 days. These encouraging developments bode well for industry overall and finally set a hoped for end in sight to the pandemic. These developments should help to reinvigorate plans to catapult industry back to full-scale operations as we move deeper into 2021.
For our part, Carlisle TyrFil, a brand of Carlisle Construction Materials, has worked diligently to maintain our supply chain flow, ensure that our customers continue to be able to both meet their customers’ demand and scale business growth effectively. We are bullish on the sustained health of our output, business expansion and continued growth both internationally and domestic. To this end, we remain focused on the following priorities:
Conveying the demonstrable, field-tested and proven benefits of Carlisle’s eco-friendly and economically advantageous TyrFil™ flatproofing technology. TyrFil is a polyurethane liquid pumped into traditional pneumatic tires to form a resilient elastomer core. TyrFil helps tires to stay impervious to typical work environment or military field site debris (sharp rock, nails, glass, rebar, shrapnel and more) that would typically cause punctures that would bring production and operations to an immediate halt. Additionally, TyrFil delivers less G-force transmission—in comparison to solid aperture tires that can transfer cross-axle jolting to operators as they sustain long hours behind the wheel over bumpy terrain.
Adapting for strategic long-term business growth. Despite the many downsides of the coronavirus climate, this is a great time for industry to stop, evaluate and take serious stock of supply chain efficiencies—and opportunities. The tire, or foam fill, sector is no exception. Carlisle continues to plan for our sustained future success—bolstering operations and infrastructure across our network to ensure the highest levels of production and enhancing technical and customer service, education and responsiveness across our robust dealer, distributor and OEM network.
Advancing sustainability and pro-environmental initiatives. As COVID-19 hopefully retreats in 2021, it will be more important than ever that businesses maintain a focus on other top priorities that may have taken a second seat during the pandemic. One such priority is the increasing necessity for global operators—and particularly multi-national corporations with strong international business interests—to continue a focus on switching to sustainable alternatives. TyrFil’s eco-friendly constitution makes it a highly viable alternative to solids. Carlisle also offers a water-based formulation for additional compliance to lowering emissions and carbon footprint reduction.
Moreover, TyrFil helps key sectors—such as construction operators—to lower costs during an already strained economic climate. While certain factors such as lowered oil prices have eased the financial strain in the construction, OTR, transportation and related fields, oil futures are expected to rebound next year. The resurgence in jobsites and production will once again spike competition. On-site operators will need to take calculated steps to keep productivity levels high and workers safe (the same practices which have applied during these past lockdown months). Because tires filled with TyrFil virtually eliminate unexpected flats, which can cause sudden worker injury, and because they may ease the muscular/physical strain associated with solid aperture use, TyrFil directly helps to better protect job site teams—thereby reducing liability and protecting operators’ fiscal bottom lines.
In conclusion, the industry will eventually return to pre-pandemic levels of health and viability. It’s incumbent on all us to continue to pull together and use resources wisely. Carlisle TyrFil remains in solidarity with each and every one of our dealers, distributors and OEM manufacturers to deliver safe, affordable and sustainable solutions now and in the many promising, and prosperous, years that lie ahead.
At Carlisle TyrFil, we’re proud to play our part to help “Keep the World Rolling.” For more information, please visit https://carlisletyrfil.com/products/.
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