Booming tire sales companies have long been looking to expand their business models in the US and beyond.
But, as the boom in tire sales in the last decade has accelerated, the market is now ripe for the taking, and new technology has helped boost the profitability of some companies.
In the last three years alone, companies such as TruckTire and Reputation Services have raised over $100 million in funding to develop new tire sales products.
Now that these companies are in the spotlight, it’s time to take a look at the potential new trends they’re unleashing, and whether the boom has already peaked.
The Future of Tires in the USA?
Tires are now one of the fastest growing categories in the industry, and that’s great news for companies that have been building their businesses around them for years.
According to a 2015 report from consulting firm McKinsey & Co., the average tire sales price in the United States has increased from $3.15 per tire to $3,868 per tire.
According a 2015 McKinsey report, “in 2019, the average American family was spending $5,977 per year on tire repair and replacement, which was an increase of nearly 17% from the previous year.”
As the industry has expanded, new technologies have been developed to provide greater convenience and better efficiency, and it’s not hard to see why tire sales are in a boom phase.
In a 2015 Fortune article, Reputation said, “Our business model is driven by the growth of our clients’ existing customer base and the need to expand our network of suppliers.”
That network includes truck tire repair shops and service providers that are also looking to ramp up their business.
In addition to expanding their network of distributors, some companies have also developed tire sales platforms.
In 2015, Reputations CEO and President Chris Torelli told Business Insider that “in order to compete with our competition, we’ve had to make significant investments in our infrastructure to support our operations.”
As more companies are able to tap into this growing market, the future of tires in the U.S. is looking bright.
Is There a New Boom in the Tire Sales Industry?
In 2015 and 2016, the growth in tire business growth slowed slightly.
That was partially because the market was experiencing its first downturn, as many companies struggled to compete against their rivals, especially in the first year of the boom.
In fact, some of the major players that saw their tire sales increase the most in 2015, including TruckTires and Reputations, saw their business decline in 2016, according to a McKinsey study.
But as this boom in the tire industry continues, there are signs that the future is looking brighter.
The industry is now in a better position to take advantage of new technology and a new generation of customers, which is why companies such a TruckTres and Represes are now looking to capitalize on this boom.
Tire sales are already one of America’s fastest growing segments of the business, and the market has never been more dynamic.
This new technology could change the industry forever, and this is the key for companies like TruckTired and RepReps to capitalize.
A new tire that’s faster, more efficient, and more comfortable will certainly be the next big thing in tire repair.
And in 2018, we’ll be lucky to see a new tire in the market that’s more than a few years old.
But we can certainly look forward to seeing a new type of tire in 2019.
This article originally appeared on Business Insider.