Dealerships, Warehouse Clubs Gain Tire Market Share

BY Courtney Huckabay
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A highlight of the 49th annualåÊModern Tire Dealer Facts Issue is its comprehensive look at distribution channels. This year, car dealerships (8%) and warehouse clubs (9%) gained market share at the expense of mass merchandisers (13%). That is not surprising, given the slowing growth at WalMart Stores Inc. and the downward financial spiral Sears Holdings Corp. experienced in 2014.

"There were 5 million more passenger tires sold in the U.S. in 2014, compared to 2013, and car dealerships accounted for 400,000 of those units," Modern Tire Dealer reports. "Their 8% share of the market is the highest it has ever been — and it is growing."

"Warehouse clubs have increased their number of outlets 7.7% since 2011."

"Franchised new-​car dealerships are slowly building up their numbers again following the recession, and that is in addition to the more than 700 (and counting) Ford Motor Co. Quick Lane locations."

"The problems of Sears Holdings Corp. and its Sears Auto Centers factors into its reversal of fortune. At one time, Sears sold close to 20 million tires a year; that total dropped to 3.2 million in 2014," MTD reveals.

"Independent tire dealers remain the dominant force in the tire industry, led by the top tire dealer in the country, Discount Tire. With close to 900 outlets and Discount Tire Direct, the company sold 28 million tires in 2014. The average Discount Tire store sells more than 80 tires a day."

The independent tire dealer channel accounted for more than 60% of the consumer tire sales at the retail level. It remains the No. 1 distribution channel by far.

Tire-​company-​owned stores have only increased their market share 1 percentage point since 1999, and have been flat the past couple of years. Goodyear Tire & Rubber Co. has been slowly decreasing its number of stores, and Bridgestone Retail Operations LLC has kept steady at 2,200 outlets.

AudienceSCAN reports 17.6% of consumers intend to buy new tires in the next 12 months. 46% of tire shoppers are female. If price and product are the same, 67.4% prefer to buy from locally owned stores, and 20.3% prefer to purchase from national chain stores.

Tire shoppers are paying attention to TV commercials ‰ÛÒ 53% took action after seeing one in the past month. 67% also read their direct mail and take action. Hearing a radio commercial spurred an online search for 19% of tire shoppers.

AudienceSCAN data is available as part of a subscription to AdMall for Agencies. Media companies can access AudienceSCAN data through the Audience Intelligence Reports inåÊAdMall.