Yokohama Rubber Co. recently announced that it would increase the export price of tire products effective January 2010. The price increase applies to all exported tire products for passenger cars, light trucks, trucks, buses, and vehicles for construction and industry. The domestic market is spared from the price hike. The maximum markup is around 15 percent, with even larger markup applied to specific regions and products. Reason given for the price hike is that Yokohama is unable to absorb the increase in prices of natural rubber and crude oil products anymore.
I did some research on the internet and found that Goodyear, the world's largest tire maker, has raised the prices of it's products in North America by 6 percent in November 2009 to offset higher raw material costs. Hence, it seems like all tire makers will soon follow the footstep of Yokohama.
The chart above shows the movement of the crude oil price over the past one year. Indeed, it is showing an upward trend and I would expect the trend to continue as the economy picks up further in the coming year.
It looks like drivers have to be prepared to fork out more for their tires in the coming year. For those who are intending to replace the footwear for their ride, do make your way to your nearest tire shop real quick.