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Special Report: Tire trouble

June 12, 2007 |

China’s explosive growth, the war in Iraq, a shortage of raw materials and the boom in mining and construction all came together in late 2004 to create a huge spike in demand for earthmover tires.

How tight is the market? If you attended the ConExpo-Con/Agg construction equipment trade show in March you were no doubt impressed by all the machinery on display. What you probably didn’t realize is many of the big machines were shipped to the show barefoot – that is, without tires – and that many of the tires put on them were leased or borrowed just for the show.

“We have high demand in nearly all dimensions – from the 15-inch to the 63-inch, the largest tire we make,” says John Funke, Michelin’s director of marketing for earthmoving tires in North America. Michelin has a new plant planned for Brazil that will be complete in 2007 and, like most other manufacturers, has increased capacity at its existing factories.

“We’re bringing on additional people, working over weekends, and ramped up to absolute full capacity,” says Cara Junkins, manager of off-the-road field engineering for Continental Tire. “But by the time you get a new tire build machine up and running, you’re talking up to 18 months. Plants can take even longer than that – two years or more for an off-the-road tire plant.”

Although nobody is making firm predictions, most feel the tire shortage will continue well into 2007.

So what’s a contractor to do? If you’re not already, you need to get serious about your tire maintenance and planning. Start doing today everything you can to maximize the life of the tires you have. If you don’t, you may find yourself parking otherwise healthy machines, all for a lack of adequate tires. Unlike classic supply-and-demand situations in which the highest bidder wins, price has not trumped fairness in this shortage. To keep one customer from taking advantage over another, tire manufacturers are maintaining the same percentages they sell to each OEM and end user, in effect spreading the pain around equally. It doesn’t matter how much you’re willing to pay – you can’t buy your way out of this problem. You have to manage it.

For some executives and top managers in big construction companies, tires may have been just another line item in the budget. “Now tires are suddenly at the top of the list in management meetings,” Funke says. And these owners and managers are asking the tire industry to help them out. “There are a lot of best practices and expertise available,” Funke says. “Everyone’s sharing information now to help the whole industry get through this critical period.”

One of the best ways to get a picture of what your tire replacement needs will be in the future is to use tire-tracking and asset-management software.