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HP UHP OE packages Plus-sizing decline? Other trends

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AKRON—The high-performance (HP) and ultra-high-performance (UHP) markets are continuing to heat up, due in large part to what OE manufacturers are rolling out on their shiny new cars.

“Certainly, high-performance and even ultra-high-performance tires are becoming more mainstream, thanks in some part to their use by vehicle manufacturers on applications that would have historically been considered to be broadline-type vehicles,” said Andrew Briggs, director of product planning at Yokohama Tire Corp.

Although vehicle manufacturers are using more high-performance tires for vehicles that otherwise would have used standard tires, he said there are also vehicles that require those types of tires—as well as consumers demanding HP tires on their own rides.

On the flip side, some consumers may not even be aware that they are purchasing HP tires if they're OE on their vehicles.

“For example, they purchased their vehicles for factors other than pure driving experience, and may not have realized that they came equipped with performance tires,” a Goodyear spokesman said.

“However, they have enjoyed the ride and handling from the automobiles and tires, and don't want to sacrifice that performance when choosing the next sets of replacement tires.”

“It's become more of a norm now,” said Shawn Denlein, senior vice president of sales for Hankook Tire America Corp. “In the high-performance category, over 16-inch H-rated is about a 25-percent share of the market already. And if you look at the forecast with RMA out, in 2017, it's supposed to be about 30-35 percent of the market.”

Robert Chew, brand manager for Falken Tire Corp., said that he does not think that HP is becoming the norm, but the shift toward high-performance for OE fitment has definitely created a demand and a shift for how these tires are viewed.

“High-performance tires are no longer the special order niche product that only enthusiasts seek,” he said.

“However, I would not say that they are the norm rather than standard tires. There has also been a surge of compact cars released in the market which require standard tire type performance.

“I believe today's market has merely shifted to include multiple categories to satisfy the diverse vehicles being produced. Take for example our Azenis PT722, a UHP all-season touring tire. Previously, touring tires would be considered 'standard tires;' now there is a demand for a mix of high performance and standard.”

Joe Maher, product manager, performance tires for Continental Tire the Americas L.L.C., said the company does not separate tire classifications into standard or HP, but rather into three passenger tire segments: touring, HP and UHP.

“Therefore, high-performance and ultra-high-performance are growing faster than touring in the replacement market,” he said. “Although, one unique caveat to this trend: there are several H-rated OE-equipped vehicles where H-rated is a touring tire with a higher speed rating.”

Tire makers agree that this segment of the industry will continue to grow for years to come.

“There will continue to be a greater emphasis on mileage in high-performance and ultra-high-performance tires, and we expect the UHP all-season segment will continue to outpace the overall growth of the industry,” Mr. Briggs said.

One reason why this segment of the market continues to grow is because of consumer demand. Consumers want tires that suit all their needs—and strides are being made by manufacturers to give consumers what they want.

“The increase in OE fitments that now require tires in the UHP all-season segment is one of the key drivers of this growth,” a Goodyear representative said. “Another key driver is the advancement in technology that allows manufacturers, such as Goodyear, to produce tires for UHP drivers that can perform at optimum levels in wet and snow conditions.”

Mr. Denlein agreed, saying consumers want a tire that performs in all conditions.

“So every tire manufacturer is trying to create a tire in this segment that can meet all the needs of the consumer,” he continued, “And keeping in mind safety and handling as well. We're actually launching a tire in the first quarter.... It's considered ultra-high-performance all-season and it's the Ventus S1 noble2.

“The design of this tire,...the focus is on ride comfort and wet traction and also for safety and performance. So we're trying to hit this segment that seems to be growing and consumers seem to want everything in the tire.”

The UHP tire might remain similar to today's definition, but improvement within the segment can still happen without changing the overall characterization.

“I do believe there will be improvements in the construction and compounding of tires to improve handling and performance, but the definition will remain relatively the same,” Mr. Chew said.

Falken's parent, Sumitomo Rubber Industries Ltd., recently developed a manufacturing system called “NEO-T01,” which the company claims will improve high speed uniformity while reducing tire weight.

“This is a great example of how the definition isn't necessarily changing, but products are still evolving,” Mr. Chew added.

With car manufacturers offering alternative packages of larger-than-OE tire sizes, also known as plus-sizing, tire makers are seeing some changes in their aftermarket business.

For instance, Toyota Motor Corp. offers through its dealers recommended “genuine” Toyota wheel/tire packages, which have been tested for noise and handling and matched to specific vehicle models, a company spokesman said.

“GM develops accessory wheels and tires for some of our vehicles that are offered through our dealers. These accessory parts are developed and validated to the same specifications and requirements as those that come from the factory. This is the only manner in which GM supports plus sizing, according to David Cowge, a lead tire engineer at General Motors Co.

“Our tires carry a TPC (Tire Performance Criteria) number on the sidewall, indicating that they are developed, validated and approved by GM for OE use,” he said. “We recommend only these TPC spec tires for use on our vehicles.”

Mr. Maher said GM now offers 18-, 19-, 20- and 22-inch tires fitted from the manufacturer.

“This industry change is bringing high rim-diameter, low aspect-ratio tires more toward the average consumer vs. only for tuners,” he said.

“The market volume will continue to grow in these sizes due to the OE application. Another effect, this OE strategy increases tire size complexity for the tire dealer.”

Ultimately, the change in the aftermarket depends on consumer preference, most companies said.

Because fashion and style continue to be factors upon which consumers base their purchases and since the larger tire/wheel packages often look better on vehicles, it helps move the trend forward, said Mr. Denlein.

“When you look at a car you're about to purchase...the car tends to look better when it has larger-size wheels,” he said. “Now when consumers choose the larger size, or the plus fitment on the vehicle, obviously what happens with a replacement size for the manufacturer, there's more profit. And there's also more profit for the retailer as well.”

Mr. Chew credits Falken's expansive offering of aftermarket tire sizes for its smooth transition as the OE market has started to shift toward larger tire sizes.

“These tires have been designed to fit and perform better than OE in every way,” he said, “while providing a stylish appearance.”

A Goodyear spokesman noted “the replacement tire segment is obviously steered to a degree by what happens at OE, so the recent growth of rim diameters has an effect. Goodyear is responding to the growth in this segment by developing innovative technologies that help provide the performance in all-season conditions that UHP drivers want for their performance cars.”

With style being such a factor for many consumers, plus-sizing is still a popular trend but, it appears, not as much as in previous years.

Conti's Mr. Maher said that aftermarket plus-sizing is still popular, but is not as strong as it was in 2008.

Mr. Denlein points back to customer preference, saying it's still an option some people choose. “Well, plus-sizing—I don't think it's ever going to die off. It's a matter of preference. And it's also a matter...of fashion and performance.

“It's not, for instance, as popular as years ago when people were going from 20 inches and up to 26 inches and even up to 30 inches in some cases. I think what's happened is consumers have become more educated on the plus-sizing part of our industry.”

Extreme plus-sizing, depending on the wheel, can cause damage to the rim and the tire if a driver was to hit a pothole, Mr. Denlein noted, so he said he thinks the maximum a consumer might choose to plus-size now is two-plus inches up from the standard size.

At the International Tire Exhibition & Conference (ITEC) in 2008, a peak year for plus-sizing, John Daws of Daws Engineering L.L.C. said in a report he presented at the show that installing plus-size tires and wheels on a vehicle will change certain vehicle performance characteristics.

Handling performance can improve with a lower aspect ratio tire because of increased lateral stiffness, he said. However, since the tire is wider, on-center tracking can decrease.

Ride comfort also diminishes with low-profile tires. Mr. Daws said, citing incidents of rim-pinch damage on a tire, as well as rim impact damage on the wheel, that are likely to increase as a tire's sidewall height is decreased. This problem is more prevalent where poor road conditions exist.

Mr. Daws said a successful plus-size fitment depends upon providing adequate tire load capacity, tire inflation pressure and wheel width.

A Goodyear spokesman said the previous fast growth rate of 21- to 24-inch diameters (extreme sizes) has leveled off and that with more new cars becoming standard with large diameter tires and wheels, there may be less of a reason to opt for plus-sizing.

“The plus sizing market is hard to gauge and is a constant study of ours,” Falken's Mr. Chew said. “While the segment fluctuates, I do not expect it to die off.”

Other HP trends besides plus-sizing are coinciding with the ever-growing HP and UHP markets as drivers demand more from their tires—such as exceptional performance across different seasons while not short-changing safety and comfort.

“I believe more high-performance products will begin to shift to an asymmetric tread design,” Mr. Chew said.

“Tires such as our flagship UHP summer tire, the Azenis FK453, are now capable of exceptional dry performance and practical wet performance without sacrificing ride comfort or noise. This has all been made possible through advancements in tire casing design and compounding.”

Mr. Denlein said there are various other “fashion” types of innovation in HP—in a way paralleling the 1990s neon lights on vehicles trend, with some manufacturers now starting to use more LEDs.

“Some of the other things I've seen from the more avid drivers with (smart)phones is that they mount cameras up and they can actually show their driving experience in a particular type of a vehicle,” he said.

“And they share that on platforms, like social media, which ultimately helps consumers learn a little bit more and helps us as a company as well, especially if the vehicle is something that we're original equipment on.”

A Goodyear spokesman said that although economic conditions can affect tire-buying behavior, the desire for “high levels of performance out of tires has not wavered.”

“So as the economy improves,” he continued, “there has been steady and continued growth in the category.”

He also said the need for information from all parties—including dealers, manufacturers and consumers—is helping to drive the industry.

“From the consumer point of view, they crave information, too. Much of that is coming via the Internet, where consumers can learn about the technology, research details about their vehicle and tire size, make preliminary selections, and even schedule shop appointments.

“This online activity helps drive consumers to dealer outlets, and in-store support serves as extra assistance once there.”



Tire Business Reporter Kathy McCarron contributed to this article. To reach Jennifer Karpus: jkarpus@crain.com; 330-865-6143.
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