Trump Tariffs May Seriously Alter the Structure of Tire Imports in the US

A new wave of import tariffs introduced by the administration of US President Donald Trump will affect the global tire industry, with the most significant consequences for companies from countries that are currently key suppliers of tire products to the US market.

According to the White House, the new measures were introduced in relation to countries that, in the opinion of the Trump administration, impose high tariffs on imports from the US and/or apply non-tariff barriers in trade. New tariffs have been introduced on supplies of goods from the following countries and regions, which import large volumes of tires to the US:

Thailand: 36% (72% tariffs are set on imports from the US, according to the Trump administration);

Japan: 24% (46%);

Vietnam: 46% (90%);

European Union: 20% (39%);

Indonesia: 32% (64%);

South Korea: 25% (50%); and

Cambodia: 49% (97%).

Earlier, tariffs were also introduced on supplies of auto parts from Mexico and Canada, but it is not yet clear how they will work in accordance with the free trade agreement between the three countries. Currently, tire plants in Mexico are being built by the Japanese Yokohama, as well as the Chinese Sailun and ZC Rubber. Regarding the latter company, it was reported that it has slowed down the implementation of the project until the situation is clarified, while the factories of Yokohama and Sailun are being built according to schedule and are expected to be launched in 2025 and 2026, respectively.

According to the US Department of Commerce, last year the country imported tires worth $19 billion. The cost of imports increased by 2.4% compared to 2023 and by 7.2% compared to 2022.

In 2024, Thailand was the largest supplier of tires to the US with an import volume of $3.6 billion, followed by Mexico, Canada, Japan, and Vietnam with indicators of $2.25, $1.87, $1.49, and $1.39 billion, respectively. It is expected that the tariffs will also affect other countries that supply a large number of tires to the US, such as Argentina (tariff size: 10%), Brazil (10%), Chile (10%), India (26%), Malaysia (24%), Philippines (17%), Serbia (37%), Sri Lanka (44%), and Taiwan (32%).

China had previously significantly reduced tire imports to the US due to already established additional tariffs, after which Chinese companies began to actively open factories in Southeast Asian countries.

After the announcement of the increase in tariffs, the shares of the American company Goodyear rose by 11.7% to $10.19 per share. At the same time, analysts at Deutsche Bank recently noted that "the company's position in the market and its production strategy may limit the positive impact of tariffs." Goodyear produces tires of various categories at its five plants in the US and owns a total of 55 production sites in 22 countries around the world.

The shares of another American tire company, Titan International, fell in price by 15.1% to $6.98. The securities of European companies Michelin, Pirelli, and Nokian fell by 2.1%, 5.8%, and 4%, respectively.

In the US Tire Industry Association (TIA), it was noted that they are "actively studying the tariff announcement." "Given the complexity of the issue and the potential consequences for our members, we will not be publishing an official statement at this time," said TIA Vice President for Government Affairs Roy Littlefield. "We believe it is essential to gather more details, assess all the consequences, and monitor all potential changes in the industry."

In Pirelli, they previously said that in view of the possibility of new tariffs, the company may increase investments in its American production.

Photo: White House