Performance tire sizes run wild: Import brands provide more than an alternative
The second in this two-part series on the high performance tire market focuses on imports and non-major brands.
Many imported tire brands have a significant share of the 22 million unit high performance tire market in the United States, according to Modern Tire Dealer statistics.
Pirelli Tire North America, which recently closed its remaining domestic tire manufacturing facility, accounts for 9.5% of the high performance market, defined as H-rated and higher, 70-series and lower tires. The Toyo and Falken brands have 3.5% and 3% shares, respectively; Sumitomo has a 1% share.
Last month, we emphasized the high performance goings-on among domestic manufacturers Goodyear Tire & Rubber Co., Bridgestone/Firestone Inc., Continental Tire North America Inc., Cooper Tire & Rubber Co. (including Pirelli), Yokohama Tire Corp. and Michelin North America Inc. Now some of the imports and other brands take center stage.
Toyo Tire (U.S.A.) Corp.
Gregory Senser, sales manager, Western Zone, high performance for Toyo, says changing market conditions come so fast that Toyo's fitment guide is back at the printer's every month.
"If you attended the SEMA show in Las Vegas in 2000 you saw a set of special-built Toyo tires on a Lincoln Navigator in our booth," says Senser. The size: 305/40VR23.
But it is the Proxes T1-S that is at the heart of Toyo's ultra-high performance offerings. This line of tires is offered in V-, W-, Y- and Z-speed ratings in 14-, 15-, 16-, 17- and 18-inch sizes. Senser says a 245/35ZR20 and a 275/30ZR20 will be added to the line by the end of March 2001.
Toyo also plans to add sizes to its Proxes ST light truck line of H- and V-rated tires, including 305/45VR22 and 325/40VR22 for full-size pickups and SUVs. Also look for a 305/40VR23 aimed at the Navigator, Excursion and Expedition. "We are very aggressive in the SUV market, where we expect to be part of some very responsible growth," says Senser.
Toyo also works with its dealers to make sure they understand what's happening on the street and in its plants. "We also offer a retail certification program that tests dealers about their high performance knowledge," says Sensor.
Another step Toyo has taken to encourage sales of high performance tires is to steer dealers away from discussing speed ratings alone. "We believe that many fashion and performance buyers are more interested in how the tire performs."
An immediate example would be the base Ford Mustang six-cylinder with 205/60R15 T-rated tires. "A good upscale option for this car would be an H-rated 215/60R15," says Senser. "This is a Plus Zero fitment that some dealers might not think about suggesting," he says. "But there are advantages to the buyer.
"First, the new tire will provide better handling, something the driver can feel. Second, the new tire will provide better braking, up to three feet of better stopping distance. What would you prefer, being two feet into the trunk of the guy in front of you or staying off the back of his car by a foot? Third, there will be no noticeable loss of tread life by going to this kind of Plus Zero fitment."
Kumho Tires U.S.A. Inc.
Kumho's Dave Hudrilik, vice president of sales, says the performance tire market will grow by 8%, the ultra-high performance tire market by as much as 13% and the H-rated, all-season touring tire market segment by 9% in 2001.
Kumho didn't have an ultra-high performance street product presence in the U.S. until the middle of 2000, when it brought in 48 sizes of its W-rated Ecsta Supra 712 with its directional tread. The company spent most of the '90s road racing, autocrossing and, more recently, off-road-racing.
Kumho moves its products through independent tire dealer channels and advertises heavily to reach its goals. Watch for Kumho ads on cable TV, expect more retail promotions (four in 2001, up from one in 2000) and a new Rally tire this spring, the R700 in five sizes initially.
The tuner market will continue to move from the West and East Coasts to the Midwest, according to Richard Purol, vice president of sales and marketing at Sumitomo Tire, a division of Treadways Corp. "This will be driven by new vehicle makers building cars and light trucks with larger diameter tires requiring H, V and Z designations."
The buyer on a limited budget will go for a lower speed rating and a less expensive wheel, according to Purol. "But for the buyer where price is no consideration, Z-rated tires will be fitted to a Honda Civic on very expensive wheels. When that setup is perceived as being out of style, he may change tires and wheels."
Purol isn't sure whether dedicated high and ultra-high performance winter and summer tires will catch on in the U.S. "It's unusual for Americans to think of buying tires that way. We do a good job of plowing and treating our roads in the snow and we have many four-wheel-drive and all-wheel-drive vehicles that allow us to handle water or snow driving without much problem."
Vredestein Tires U.S.A.
"Because European drivers demand it and because American drivers are catching on, we are appealing to the independent tire dealer market with a line-up of dedicated summer, all-season and winter tire products," says Vredestein President Al Smoke.
Vredestein recently hired one of Europe's top design houses, Giugiaro, to design its new W-rated Sportrac. The Sportrac will "provide the best possible wet handling at very high speeds," says Smoke.
Also important to Vredestein's strategy is the decision to market only to select U.S. independent tire dealers and to offer only premium tires. "All of our tires are directional, our focus is on top performance as advertised and our demographics are generally to higher income buyers."
Maxxis Sales Manager Greg Rauth says the growth of light trucks and SUVs as a percentage of overall new vehicle builds is now being reflected in the replacement market. "Our business is 65% light truck, 35% passenger tires," he says.
On the passenger tire side of the Maxxis business plan, Rauth says he has been somewhat slow to respond to the ultra-high and high performance tire market segments. He'll be ready to play catch-up this spring with a new MA-501 H-rated, directional passenger tire in five sizes. "This will come in 40- and 45-series aspect ratios in 16-, 17- and 18-inch diameters.
"Also available is the new directional, V-rated MA-V1 in 20 sizes initially," says Rauth. The Maxxis Marauder, an H-rated directional tire, also will be available in eight sizes for the SUV market.
Hankook Tire America Corp.
Bill Finn, senior vice president of sales for Hankook Tire America, says the tuner market has helped the ultra-high and high performance tire segments lose some of their definition. "While the Honda Civic is a great car, it is not a performance car," he says. "Yet owners turn to 17- and 18-inch tires, often ZR rated, not for speed but appearance."
He says H-rated tires remain an in-demand product, as do Z-rated (W and Y) tires. "But the V-rated product doesn't seem as popular as it was."
Hankook services the ultra-high performance market with its Ventus K102 Z- and W-rated product in 16-, 17- and 18-inch sizes. The Ventus Plus 405, a Z-rated tire, also is available.
Hankook, which is marking its 20th year in the U.S. marketplace, sells to independent tire dealers through wholesalers and large independently owned multi-store chains. "At this point, we have roughly 2,000 to 3,000 points of sale in the U.S.," says Finn.
Hoosier Performance Tire
A spokesman for Hoosier Performance Tire makes no bones about Hoosier being a longtime player in the motorsports market. "That's our history, that's what we sell... motorsports is our number one marketing tool. As a division of Hoosier Racing Tire we work hard on capitalizing on our brand awareness every day."
According to Hoosier, the buyer of a Hoosier tire is a high-performance enthusiast who wants a product that supports that lifestyle. Hoosier Performance Tire is in year three of establishing a comprehensive program for independent tire dealers. The company primarily sells through 22 big wholesale distributors.
"When I think of the motorsports market I go by the 80/20 rule," says the spokesman. "Twenty percent is where CART, Winston Cup and Formula 1 drivers and fans are involved. Eighty percent is where the rest of the motorsports market resides and that's where Hoosier dominates."
Hoosier's experience in the pits at SCCA road races and autocross events, NASCAR touring and stock car racing all over the country, ARCA races, the World of Outlaws, USAC, NHRA, IHRA, as well as car club conventions for Porsche, Corvette and BMW "is the basis of our marketing premise. We have a built-in clientele who need tires not only for competition but for their street vehicles as well."
"This is a tight, selective, high quality marketing niche where customers can purchase German-made H-, Z- and W-rated directional tread ultra-high performance and high performance tires at a per tire savings of $30 compared with the flag brands," says Ken Fischer, sales manager for Fulda Tires.
In the U.S., the Fulda brand is owned by Goodyear but is exclusively marketed by TBC Corp. Fischer says Fulda tires are sold only through independent tire dealers.
"We see this tire evolving into an option for the tuner market," says John Clancy, Pirelli's product, motorsports and ultra-high performance manager about the P7000 Super Sport. "Owners of a Ford Focus, Honda Civic or Subaru Rally might naturally turn to sizes we can offer immediately---205/55ZR16, 2-5/40ZR17 and 215/35ZR18."
Marangoni is gearing up to make a name for itself in the U.S. performance and ultra-high performance passenger tire markets. Its forthcoming marketing campaign will promote the company's European heritage.
"We'd like to compete at the top of tier two, with Pirelli, Dunlop, etc.," says Tom McNamara, vice president of sales and marketing for the company's Marangoni Tyre Division. Marangoni officials are currently pitching their tires to "performance dealers of all shapes and sizes" throughout the country.