current Conditions
Following two years of economic strain, U.S. tire demand began to rebound in 2010, but "material shortages" and "price increases" began to surface. One spokesman told ICIS Chemical Business, "Volatility remains in the area of raw materials, with some cost increases expected to exceed 35 percent in the second half of 2010." Part of the shortage was the result of carbon black suppliers who were hesitant to fire up idled units concerned they would get stuck with excess supply. Another chemical, butadiene (BD) used in the production of tires, was also in short supply, adding to the industry's woes. Nevertheless, both Bridgestone and Goodyear reported positive results for the first quarter of 2010. Goodyear's shipments grew 14 percent during the first-quarter of 2010.