Sailun Tire finds ERange EV success electrifying

BRAMPTON, Ontario — Turns out, even those consumers who have the means to purchase Tier 1 tire products at Tier 1 prices are looking for value, especially when it comes to replacing tires on electric vehicles (EVs).

In the nine months or so since Sailun Tire Americas (STA) debuted its ERange EV tire portfolio, sales have exceeded expectations, according to Ron Dolan, president of the North American subsidiary of China's Sailun Group Co. Ltd.

That goes for both Canada and the U.S., where the tires are distributed exclusively through TBC Corp.

"We have far surpassed what we thought we were going to do," Dolan told Tire Business.

He admits initial expectations were "modest" considering that Sailun, with a value-tier portfolio, was entering an emerging market, but Dolan said the tire maker is getting "a lot of reordering from our customers in Canada and from TBC. It's going well, and we're quite excited about."

The ERange portfolio covers 80% of the passenger/CUV/SUV market. In the next couple of years, the tire maker plans to roll out a light truck tire for transit/small-package delivery vehicles.

"We believe nobody has addressed that segment properly," Dolan said.

Why the early success, especially with EV consumers who typically can afford to pay Tier 1 prices?

First of all, Dolan said Sailun is focused on getting its message across to the EV customer, and the ERange is priced above where a typical Sailun tire is sold. The price is higher, Dolan said, since the tire features Sailun's proprietary EcoPoint3 liquid-phase rubber-compounding process, technology that allows materials to be mixed uniformly under continuous liquid-phase conditions, creating a more consistent rubber compound mix.

Dolan said EV owners are recognizing that the product "performs as good as the leading brand, is 20% or 30% cheaper at retail, but is still a great value product. Just because you have the money, it doesn't mean you have to overspend if you get a product that delivers all the same attributes."

He said he believes that trend will expand, once mid- and entry-level EVs begin to become prevalent in the market.

"We have a product that we believe addresses people that don't want to spend leading-brand dollars as well," he said. "We think it's a very smart buy for any consumer, somebody that is price conscious as well as someone who wants quality."

The ERange EV tires are manufactured at Sailun's factory in Cambodia, which opened in early 2022. In fact, Dolan said that the vast majority of tires sold in the U.S. and Canada are sourced either in Cambodia or Vietnam, as opposed to China.

The Cambodia plant has helped Sailun diversify its business, according to Dolan.

"With some of the equipment we've installed in Cambodia, it's allowed us to do some real neat products and higher rim diameters," he said, specifically mentioning an investment there to produce rugged-terrain products.

"We're a value-tier company, and we're proud of it, but we have the ability now with the technology and equipment that we've placed in our factories, that if we have customers come to us and want us to produce a product that's a little bit different, a little bit more niche, we have ability now," Dolan said. "It's fun to have that tool in your shed."

Sailun recently opened a 22,380-sq.-ft. research and development center in Chattanooga, Tenn., where engineers work on original equipment and replacement tire designs across a number of sectors, including cars, CUVs, SUVs, light trucks, trucks/buses and electric vehicles. Three employees work at the site.

Dolan said the R&D center also will provide training for customers on Sailun products.

"One of areas we need to improve on is that counterperson who is selling our product every day," Dolan said. "We have to have him or her understand that message, understand the Sailun product difference."

Dolan said he and others at the company are investing time and resources into figuring out the future of tire sales.

Will consumers go to a subscription-based ownership model for a vehicle? How will the distributorship model change? How will artificial intelligence (AI) affect the market?

"The way a consumer will buy tires at the passenger level will change dramatically," Dolan said. "We think about the future of autonomy and a car coming to pick you up in your driveway."

The immediate challenge, however, is to continue to increase Sailun's brand awareness.

"We believe we have a product that can compete with anybody's from a quality point of view; they just don't know about it," Dolan said. "We are really working hard to talk to that next generation. We're talking to the current generation, but the future is poised for us and others to be successful."

According to the 2022 Tire Business Global Tire Report, Dongying City, China-based Sailun stands as the No. 15-ranked tire maker in the world, with 2021 global sales of $2.7 billion.

Dolan said the tire maker plans to grow smartly, backed by "great products, great customer service, best in class logistics."

And, he said, they will continue to do it by collaborating with the dealers who sell their products. That, he said, is what makes the tire maker unique.

"We don't start one project until we get sign-off from particular dealers who will be affected by that idea," he said. "We are collaborative, we listen.

"We treat dealers how they want to be treated. (Tire dealers) are working with people who actually care and listen."