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Pirelli’s premium strategy

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Pirelli’s premium strategy

Pirelli Tire LLC is making a big push to increase its market share in the United States. That’s the message Chairman and CEO Paulo Ferrari emphasized directly and indirectly at the recent Pirelli P Zero Nero GT launch in Akron, Ohio.

How will Pirelli do that? Directly by catering to vehicle manufacturers and tire dealers. Indirectly by supplying both groups with the tires they need to succeed.

Focusing on “premium” products is the foundation of Pirelli’s strategy, according to Ferrari. He defines premium as more than just high speed ratings. The designation also includes sizes 17-inch and above.

Pirelli & Cie SpA’s research and development budget is “fully dedicated” to premium products. The budget represents 7% of global sales.

OEMs and tire dealers

Ferrari says the parent company owns a 25% market share in premium original equipment fitments globally. Brands like Porsche, BMW and Mercedes are a good fit because they, like Pirelli, are premium products. The company also supplies tires for the Ford F-150.

In the U.S., Pirelli Tire is growing significantly with premium dealers like Discount Tire Co. Inc., Dealer Tire LLC and The Tire Rack. Its growth is based on improving its fill rates and developing new products.

One way Pirelli has addressed fill-rate problems is by ramping up capacity at its new tire plant in Silao, Guanajuato, Mexico. The facility will produce 1.2 million premium tires this year and 2 million next year. Eventually, the plant will be able to produce 5.5 million tires annually.

Ferrari adds that the company’s fill-rate percentage has “improved dramatically the last two years,” in part because importing tires from Mexico to the U.S. is faster than importing them from Pirelli’s plant in Brazil.

P Zero Nero GT

Pirelli will introduce 18 tire “projects” in North America in the next five years. That compares to 16 in the last 10.

The new P Zero Nero GT is one of the projects. The summer sport ultra-high performance tire has the same tread pattern as the P Zero Nero, but is superior to it in dry handling, dry braking and tread wear. Pirelli’s engineers were able to improve on those characteristics without compromising the original tire’s wet handling and braking, comfort, aquaplaning (in the straightaway) and rolling resistance characteristics.

Steve Carpino, Pirelli’s vice president of research and development in North America, says the P Zero Nero GT has greater tread life than its predecessor thanks to 1) compounding changes, and 2) mold and spec changes that result in “more contact in the shoulders.”

Pirelli will release the P Zero Nero GT in 26 17-, 18- and 19-inch XL sizes that fit a wide array of vehicles from sports coupes to larger, high-powered sedans.

17-inch (6): 225/55ZR17 101W to 215/40ZR17 87W.

18-inch (9): 225/45ZR18 95Y to 255/35ZR18 94Y.

19-inch (12): 225/40ZR19 (93Y) to 275/30ZR19 (96Y).

There also is one non-XL size: 255/45ZR18 99Y. Over the course of the year, the line will expand to 60 sizes.

In the replacement market, the P Zero Nero GT will compete against the Continental ExtremeContact DW, Michelin Pilot Sport PS2, Goodyear Eagle F1 Asymmetric, Bridgestone Potenza RE060A and Hankook Ventus V12 evo.    ■

Pirelli gets a ‘grip’ on its global image

Canon U.S.A. Inc. was wrong: Image isn’t everything. A well-earned reputation also is a marketing necessity.

Pirelli & Cie SpA, already famous for its annual Pirelli Calendar, is attempting to combine both image and reputation by expanding its partnership with professional golfer Francesco Molinari to include Pirelli-brand golf club grips. Made by Lamkin Corp., the line will feature color-coded grips (pictured at right). Rafael Navarro, vice president of communications for Pirelli Tire LLC, says the grips hopefully will be available to golfers in the near future.

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