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North American automakers are facing a tire shortage, caused by tire plant closings and higher demand for specialty tires. Automakers are paying much higher prices with a double-digit percentage increase from a year ago. Automakers pay as little as $73 per tire for low-end models to as much as $300 or more for high-performance tires. 

There are a lot more tire sizes in the marketplace now. Producing extra tire sizes and low-volume specialty lines reduce a standard tire plant's capacity. Tire makers had been cutting back on North American production capacity before the recession. In 2006 and 2007 four U.S. tire plants were closed. Tire manufacturers were opening factories in China that flooded the U.S. market with cheap tires. But in September 2009 the Obama administration slapped a three-year tariff on imported Chinese tires. The tax started at 35 percent of a tire's value declining to 30 percent and 25 percent in the second and third years. The import tax expires in September 2012.

Increases in the cost of rubber and other materials used in tire manufacturing, including steel, have tightened supplies and driven costs higher. Since 2005, the combined prices of natural and synthetic rubber, carbon black, steel cord, fabric and other materials have risen nearly every year.

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