USTMA Shares Economic Outlook Analysis & Impact Trends
WASHINGTON, D.C. (March 31, 2021) – As President Biden prepares to lay out a broad infrastructure vision for the nation, the U.S. Tire Manufacturers Association (USTMA) today released key findings from an economic outlook analysis to identify trends and strategic opportunities for the U.S. tire manufacturing industry over the next five years and relevant issues influencing transportation. The analysis, conducted in late 2020 by a top economist, provides insights into four focus areas—economic impact and recovery from the coronavirus pandemic, digital transformation, changing societal views on mobility and environmental stewardship.
“There is a natural connection between priorities of the tire manufacturing industry and revitalizing infrastructure. The safety and sustainability of the life cycle of our products depends on having safe bridges and roads to travel, and even exploring how recycled tires can help create longer-lasting roads,” said Anne Forristall Luke, president and CEO of USTMA. "And as we are grateful for the signs of recovery our sector has experienced in recent months, including better-than-expected results for tire shipments in 2020, we are also encouraged that some of the key report findings align with strategic initiatives already underway within the tire manufacturing sector.”
“Our experience navigating the impacts of the pandemic reaffirmed that tire manufacturing is a resilient and essential industry driving the economic engine of the United States, and supporting more than 284,000 jobs,” added Forristall Luke.
Topline findings of the analysis include:
In 2020, COVID-19 brought a deep global recession that cut consumer spending, hurt industrial production, and up-ended normal business planning.
The collapse in travel for work, pleasure, and shopping in 2020 drove demand for virtually all goods and services associated with travel down sharply. As a result, spending on both new and used light vehicles fell by nearly a third, while spending on tires fared comparatively better, only falling 15 percent from February to April, while total consumer spending slumped nearly 19 percent.
As our momentum accelerates coming out of a turbulent year, our members advocate and innovate to adapt to a “new normal” protecting the nearly 100,000 tire manufacturing workers employed across 17 states. From securing our position as an essential industry at the onset of the pandemic to sustaining and creating new jobs, and supporting vaccination efforts, we remain focused on restoring and reinvigorating our workforce and the tire manufacturing industry.
The accelerating pace of digital transformation continues, with the rollout of 5G technology and the shift to electric and automated vehicles gathering significant traction.
Our members continue to partner and invest in research and development to support digital transformation, improve efficiencies, and bring innovative and safe products to market, including:
- Collaborating on new solutions like the first-of-its-kind tire monitoring application, intelligent brake system, a supercomputer for vehicle AI system training, partnering on pilots to advance connected mobility and showcasing future mobility solutions.
- Leveraging data and digital technologies, including launching a new digital supply chain tool for dealers.
- Supporting the deployment of self-driving trucks and electric cars.
CHANGING SOCIETAL VIEWS ON MOBILITY:
COVID-19 has disrupted social mobility preferences and accelerated existing societal shifts in mobility.
A few evolving trends USTMA’s members are following:
Early on during the pandemic, millennials were adopting more classic Gen-X behavior, including a growing affinity for suburban living where driving rates are higher, after facing restricted mobility due to lockdowns.
At the same time, the dramatic drop seen in commuting patterns, greater reliance on e-commerce and demand for last-mile delivery services will remain significant factors in shaping mobility—even after a full vaccine roll out.
USTMA companies like Michelin are engaging younger demographics to better understand future mobility habits.
Action on climate is a growing focus for consumers, investors, and policy makers. There is a growing expectation for federal action to address climate change.
- Manufacturing low rolling resistance tires that contribute to improved fuel efficiency by reducing tire weight and decrease fuel consumption and CO2 emissions. The use of low rolling resistance tires would save about 1 billion to 2 billion gallons of fuel per year, the equivalent amount of energy needed to power over 1.5M homes or 1.9M passenger vehicles for an entire year.
- Developing tire materials with lower carbon footprints, like silica derived from rice husks to improve rolling efficiency, while maximizing safety, performance, handling, and durability.
- Powering facilities primarily with natural gas, offering lower greenhouse gas emissions than other manufacturing sectors.
For more information about USTMA’s sustainability efforts, please visit https://sustainability.ustires.org/
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The U.S. Tire Manufacturers Association is the national trade association for tire manufacturers that produce tires in the U.S. Our 13 member companies operate 57 tire-related manufacturing facilities in 17 states and generate more than $27 billion in annual sales. We directly support more than a quarter million U.S. jobs – totaling almost $20 billion in wages. USTMA advances a sustainable tire manufacturing industry through thought leadership and a commitment to science‐based public policy advocacy. Our member company tires make mobility possible. USTMA members are committed to continuous improvement of the performance of our products, worker and consumer safety and environmental stewardship. For more information visit www.USTires.org and follow us on Twitter @USTires.