The Tire Retread & Repair Information Bureau (TRIB) conducted its 2nd Annual Survey on the State of the Retread Industry, providing insights into the retread tire industry's current state and outlook.

The survey collected responses from TRIB members on various topics, including revenue impacts, the industry's biggest challenges, the state of the casing market, and sustainability issues.

Work Truck dug into the survey results and chatted with TRIB about retread tires for fleet operators.

Retread Industry Trends and Opportunities

The tire retreading industry is currently facing challenges due to the increasing rates of low-cost imports from Asian countries that are competing with U.S.-manufactured retreads.

However, the industry is optimistic about the future, given the resolution of some of the supply chain bottlenecks and port slowdowns caused by the COVID-19 pandemic. 

According to David Stevens, managing director of the Tire Retread & Repair Information Bureau (TRIB), "The reality is that a quality new tire that provides multiple retreads will always provide a lower cost-per-mile than a lower-quality new tire. With the continued growth of last-mile delivery and EV tires, retreaders are increasingly focused on meeting the needs of those customers as well."

2023 was another strong year for retreading driven by fleet demand, the supply chain issues mentioned above, and continued challenges in the economy with pricing (retreading is very much a counter-cyclical industry).

“With an increasing supply of new tires in the market and a slight easing of economic challenges, retreaders are being more cautious about their outlook in 2024," Stevens said.

Based on these trends, how can fleet managers anticipate and adapt to changes in the retread industry's revenue landscape?

"For fleets that aren’t utilizing retreads as part of their tire program, now is a great time to discuss options with their tire providers and look at testing retreads compared to their current new-tire-only programs. It’s also a great time to look at retreaders as U.S.-based tire suppliers so fleets aren’t scrambling for solutions when the next disruption inevitably hits," he added.

When asked about emerging challenges fleet managers should prioritize addressing in their operations, Stevens noted he wouldn't necessarily call them challenges but questioned whether fleets are prepared to capture, manage, and utilize all the data that will soon be captured with each tire to make intelligent tire decisions. 

“Are they prepared for the issues of moving to smaller tire sizes with last-mile delivery vehicles? For fleets shifting to EVs, have they had the right conversations with their tire partners about finding the right new/retread combination for those vehicles?" Stevens said.

Understanding the pricing and market trends for casings in the U.S. can be challenging, especially when predictions seem to differ. According to Stevens, the key drivers behind these divergent predictions are simply supply and demand.

"Retreading has had a couple of strong years in production, and they've been utilizing a lot of the casing inventory available. With a little more softness in the first two months of the year, many retreaders are predicting a similar softening in casing pricing," explained Stevens. Therefore, the industry is closely monitoring the market trends to adapt to any changes and ensure the continued success of the retreading sector.

Looking ahead at future availability, "I think in 2024, fleets won’t have to worry as much about as many shortages in availability for certain tire sizes," Stevens said. 

In recent years, sustainability initiatives have become a key focus for the retread manufacturing industry. Not only do these initiatives align with broader industry trends, but they also meet consumer expectations.

According to Stevens, retread manufacturers have always been at the forefront of sustainability initiatives.

"Having retreads as part of their tire program can easily help fleets meet their own sustainability or carbon reduction targets. Some retreaders are also providing environmental calculators and confirmation for customers of the amount of environmental savings they have achieved through retreads," he said.

Moreover, retread plants themselves constantly evolve to operate in the most sustainable way possible. These initiatives include recycling rubber buffings and end-of-life tires, utilizing solar power, installing rainwater recovery systems, installing motion-sensitive LED lighting, and recycling every other item that comes into a plant, such as wooden pallets, paper, etc.

These initiatives are essential to sustain the industry and ensure a greener future.

Fleet managers looking to enhance their environmental footprint can find many opportunities to collaborate with retread suppliers on sustainability initiatives. Incorporating retreads into commercial fleet tire programs is one of the most effective ways to achieve environmental targets.

"This is a great opportunity for fleets to have those discussions with their tire and retread partners, explain their environmental goals, and discuss how retreaders can help them meet their goals. We hear a lot about aerodynamic improvements, lower rolling resistance tires, improved fuel efficiency, etc.. Still, I think the greatest impact fleets can have on their environmental targets is incorporating retreads into their tire programs," Stevens said.

And, when it comes to the ever-prevalent myths surrounding retreads, don’t believe them.

“There’s a reason that almost 90% of fleets with 100 or more trucks use retreads -- they’ve done constant testing, and they know that they get the best performance and the lowest cost-per-mile from having retreads as part of their tire program. If there were any issues with using retreads, then school buses, emergency vehicles, and aircraft wouldn’t be using them. Retreads are the right choice for so many reasons. Support U.S.-based manufacturing jobs, save a ton of money for your fleet, and have a real environmental impact," Stevens concluded.

Digging into the Survey Results

According to the survey, 72% of the survey respondents were based in North America, while 12% were from Europe, 8% from the Asia Pacific region, and 8% from Latin America. The survey also revealed that 73% of respondents manufactured commercial truck retreads, 23% manufactured off-the-road retreads, and 18% manufactured light truck/passenger retreads.

Regarding revenue trends, 58% of respondents reported an increase in revenue in 2023, 11% reported a decrease, and 31% reported no change. Looking ahead to 2024, 54% of respondents forecasted an increase in revenue, only 3% predicted a reduction, and 43% expected no change.

The survey also highlighted the industry's biggest challenges, with human resource challenges ranking highest, with a score of 6.74 out of 10. Supply chain issues, low-cost imported tires, rising costs, casing availability, regulatory/legislative challenges, and misconceptions about retreading were also identified as significant challenges.

Additionally, the survey revealed that 36% of respondents reported making large investments in their business in 2023 or plan to do so in 2024. Meanwhile, 46% reported making minimal investments, 11% reported no additional investments, and 7% were looking to sell.

When asked about changes made in their business that had the greatest impact on productivity and/or profit in the last two years, investing in sales and service capabilities, along with rewarding employees appropriately, increasing investments in equipment, software, and alternative power sources, and driving more efficient work processes that lead to cost reductions were the top answers.

Regarding the pricing and market for casings in the U.S. in 2024, 54% of respondents predicted decreasing prices, while only 23% predicted increasing prices, and 23% expected the market to remain flat.