Tire dealers keep on rolling despite price hike

All signs point north as tire prices continue to increase in an already dampened economy, causing job loss, consumer panic and unsafe driving conditions. Sources indicate that nationwide tire prices are on the rise and will continue that trend throughout the year. But the question is “why?”

Easy answer.

A 35 percent tariff was placed on low-cost import tires from China this past September, forcing manufacturers nationwide to increase the shelf price of tires in efforts to recoup lost revenue.

Rising raw material cost and gas prices have also played a role in the increase.

The tariff was the result of allegations from a U.S. union stating that over 5,000 jobs had been lost by U.S. tire-workers ousted from too much Chinese competition. But according to experts, the tariff proved unsuccessful in creating new jobs in the U.S.

And now local tire retailers are beginning to voice concern.

“The tariff went into effect, but it didn’t [create] jobs,” said Charley Gowland, owner of Chabills Tire Traxx in Houma. “It just raised the price of Chinese tires.”

So now retailers are speculating that tire manufacturers located in China will soon be relocating to countries like Mexico, Brazil and Argentina – or countries where an import tax doesn’t exist. This will alleviate damages caused by the tariff, but will it solve unemployment problems in the U.S.?

Gowland said that if manufacturers change locations it would not solve the job problem. “The only thing [relocating] will change is labor cost. And it’s going to be higher in other countries than it was in China,” he commented.

Tire prices are expected to rise as much as 30 percent in the next few months. While manufacturers like Goodyear and Cooper have already raised prices 5 to 10 percent.

“Tires are a commodity based on world events…[their price] has a global effect…and right now things are going up,” noted Gowland.

However, low cost tires will take the brunt of the price hike, leaving many consumers at odds about replacing rubber.

As the niche’ in the market for entry-level tires increased, they became a “Godsend” he said. “[Entry-level tires] were great for people with old cars who didn’t want to put a lot of money in the car, or who wanted to sell it.”

But now with entry-level prices climbing to match those of premium tires, consumers are trying to avoid replacing tires until it’s do-or-die. Presenting potentially dangerous situations on south Louisiana highways.

Especially “…with as much rain as we get in summer and our roads not being the best,” said Jeremiah Pellegrin, salesman for TCI Tire Center in Houma.

“It’s an absolute fact that too many tires are in service that shouldn’t be,” warned Gowland. “I guess it’s because of the economy.”

Local industry professionals also said you get what you pay for. While entry-level tires may ease the financial “sting,” brand names offer reliability and longer road life.

“Tires nowadays are getting more and more specific in size and speed rating,” said Shawn Duffy, service manager at Chabills. So lower costs may mean a lower return on investment for consumers looking to get the best bang for their buck.

Duffy also said that while some tires produced in China may warrant safety issues, many are “…perfectly good tires.”

Technical jargon aside, when wear indicators are showing, it’s time to get new tires.

Local shops have also taken steps to make sure customers are safe and tires are installed properly. “We double-check lug nuts with a hand torque to make sure they are tightened to manufacturers specifications,” said Mike Cohen, Chabills manager. “Over-tightening is the same as not tightening enough.”

There are also a few things you can do to keep you safe on the road – and maybe get a few more miles per gallon from the old clunker.

For Joe Bates, 33, a service technician at Chabills Tire Traxx in Houma, replacing tires is just part of the daily agenda. Demand for entry level low cost tires is beginning to waiver, a result of a tariff placed on tires imported from China. * Photo by MICHAEL DAVIS