Fighting for one million units: From A to Zeon, everybody wants a piece of the tuner tire market
"We don't want to be the bottom-feeders of the performance tire market." So says Kurt Thomas, manager of high and ultra-high performance products for Cooper Tire & Rubber Co., on the eve of the company's huge performance tire initiative.
Cooper plans to attack the H-, V- and Z-rated passenger and sport truck tire segments with new products, including the Zeon family. The Zeon 2XS will cater to the sport compact tuner market.
Cooper is the latest company to enter the fast-growing high performance market and its various niche segments. In 2002, there were 29.5 million H-, V- and Z-rated tires shipped domestically at the replacement level, an increase of 18% over the previous year. At the same time, the overall replacement passenger tire market dropped about 1%.
Kumho Tire U.S.A. Inc. estimates street tuner tires made up 14% of the domestic ultra-high performance passenger tire market last year, or 1.2 million units. That's a unit increase of 45% from 2001.
SURE Tire Co. recently introduced its "Concept Essenza" private brand tire and wheel program geared to the tuner market. Brad Saunders, vice president of Fairmount Tire in Los Angeles, Calif., and a SURE Tire shareholder, says tuner tires and wheels represent a $1 billion-plus market.
Goodyear Tire & Rubber Co., which manufactures the Essenza, began focusing on the sport compact tuner market last September with the introduction of the Eagle F1 line in 39 sizes ranging from 15 to 21 inches. It will add 19 more, with several 20- and 19-inch sizes, in the second quarter.
In November, Goodyear named Mike Pulte manager of niche marketing to head up Goodyear's increased emphasis on tuner tires.
Distribution groups like American Tire Distributors (ATD) are paying close attention to the trend.
"Just as the youth of the 1950s polished their muscle cars and hot rods, younger buyers of today are customizing their Hondas, Mitsubishis, Toyotas and Acuras to make a style statement," says Jason Shannon, ATD's director of marketing. "While I do not have any referencing data, the anecdotal evidence from some of our dealers seems to support the idea that some of these younger buyers are working multiple jobs and eliminating other purchases like clothes or jewelry to outfit their cars with the latest custom wheels.
"In particular, this 'tuner market' is really growing, and several manufacturers (like) Kumho, Falken, Nitto and Yokohama have really been able to take advantage of it because of the attractiveness of their price point and the availability of large rim diameter fitments (20-inches-plus). With the economy's pace of the last several quarters, I would have expected this segment's sales to decline; however, this particular segment seems to be fueled by the pride of the driver rather than the pull of their pocketbook, as sales have maintained steady growth."
Shannon says discussions with both Goodyear and Michelin North America Inc. about adding tuner sizes to its Regul and Winston private brand lines are ongoing. "In the short term, we're continuing our relationships with Kumho and Hankook, and we recently added Pirelli to address the tuner market in particular."
According to a recent report from Frost & Sullivan, the growth of organized races and shows has been a strong driver in expanding vehicle and enthusiast involvement in sport compact tuning.
"The number of vehicle models and vehicles applicable to sport compact modifications has significantly grown," says Mary-Beth Kellenberger, a research analyst for Frost & Sullivan. That includes both import and domestic compacts.
SEMA (Specialty Equipment Market Association) estimates aftermarket retail tuner sales, including tires and wheels, topped $1.5 billion in 2001, up from $295 million in 1997.
Vehicle manufacturers are getting into the act, too. At the 2002 SEMA show in Las Vegas, Nev., Jim Schroer, executive vice president of global sales, marketing and service for the Chrysler Group, said, "We're catching the next wave. We're going after a new generation of tuners and appealing to the compact performance market."
He says the idea is to connect Chrysler, Jeep and Dodge vehicles to potential buyers now aged from 12 to 25. "We want to be the three brands of American vehicles that the consumer market tricks up the most."
To excess (2XS)
Phase one of Cooper's high and ultra-high performance game plan begins April 15 with the introduction of the W-rated Cooper Zeon 2XS (in photo). Initially, 14 of 29 sizes will be rolled out, ranging from 15 to 18 inches and focusing on original equipment sizing. "(We are) doing the groundwork on 20-inch sizes," says Thomas.
The Zeon was based on technology learned from the company's Avon race division. The tires are being manufactured at Avon's Melksham, England, plant abroad and Cooper's Findlay, Ohio, and Tupelo, Miss., facilities domestically.
The Mastercraft version of the Zeon 2XS will be the Avenger ZHP.
The tentatively named Zeon ZPT entry-level line will focus on plus fitments for passenger cars. It will be priced below tier one products and compete against brands such as Kumho and Falken, according to Thomas. "Their goal is show," says Mark Jackson, Cooper's high and ultra-high performance marketing manager, about tuner enthusiasts.
The H-rated all-season high performance tire will be available in 15- through 18-inch sizes. "Realistically, we'll probably narrow it down to eight to 12 sizes, with emphasis on 17- and 18-inch sizes," says Thomas. The Mastercraft counterpart is tentatively named the Avenger HP.
Also part of Cooper's push is the expansion of its Lifeliner Touring SLE (and Mastercraft Avenger LSR) H- and V-rated lines. Fifteen new sizes of the Lifeliner Touring SLE were introduced in December. "We are reviewing 2003 vehicles to see if additional sizes are necessary," says Thomas. "We've been a fast follower of the new OE fitments."
The new Cooper Lifeliner SLE Sport is being marketed as a Z-rated extension of the Lifeliner Touring SLE line. The all-season, ultra-high performance tire will feature light snow traction characteristics and initially be available in 12 Z-rated sizes by year's end. Mastercraft Avenger LSR sizes will follow.
Tuning sport trucks
Cooper also is introducing the Cooper Zeon XST, a tuner tire for pickups and SUVs. Nine 18- and 20-inch sizes will be introduced in June and July; four 22-inch sizes will be available in the fourth quarter. The Mastercraft Avenger ST is the Zeon XST's counterpart.
Cooper is taking a close look at the viability of producing 24-inch sizes, adds Thomas.
Hankook Tire America Corp. (Ventus ST RH06), Kumho (Ecsta STX) and Pirelli Tire North America (Scorpion Zero) introduced 24-inch tires last year. Kumho also is on schedule to begin producing size 305/30VR26 tires later this month.
According to Kumho, there were 167,000 sport truck tire units produced in 2001; more than half of them were P-metric sizes.
"The growth of large diameter fitments seems to be increasing the awareness of custom wheel and tire combinations, and several manufacturers have been quick to offer 24- and 26-inch fitments to drive brand equity within these highly visible sectors of the performance market," says ATD's Shannon. "This additional exposure for the performance tire and wheel market is attracting new consumers each day."
Tire manufacturers and marketers are taking their involvement in the tuner market one step further by offering wheels as well. In addition to SURE Tire with its "Concept Essenza," both Falken Tire Corp. and Tireco Inc. showcased wheels at the International Tire Expo in Las Vegas. Hankook Tire Co. Ltd. owns its own wheel line, ASA.
Cooper's Thomas says his company has been contacted by wheel manufacturers who are trying to put tire and wheel packages of their own together. "We have at least asked ourselves, 'Where do wheels fit into this?'"
At least one economic factor related to new car sales trends is having an effect on wheel sales, says Shannon. "Many consumers who take advantage of the 0% financing available for new vehicles are taking the opportunity to individualize their vehicle with performance tire and wheel options and including the upgrade as part of the financing. This has increased both the consumer's and the original equipment dealer's interest in custom wheel option packages for the vehicle."
Shanon says many of ATD's retail customers capitalizing on this boom emphasize training. "They have educated their sales staffs on how to sell wheels. Wheels require a bit more technical expertise than a tire sale because of the variety of wheel offsets and bolt patterns used by today's vehicle manufacturers. Our customers tell us that the knowledge of a trained wheel specialist is extremely valuable in being able to help their sales staffs make technical fitment recommendations for a particular consumer's vehicle and wheel choice."
There were 8.6 million ultra-high performance tires shipped in the U.S. last year. That makes up 29% of the high performance market. OE shipments were only 3.4 million units, however. "The growth in the ultra-high performance market is not driven by OE," says Rick Brennan, Kumho's high performance brand manager.
Cooper is not the only company ready to introduce ultra-high performance products.
"We are targeting the (Federal) SS595 to the tuner market," says a Federal Corp. spokesperson. "This year, the 19- and 20-inch sizes will be available. We are also planning to have more new patterns coming up soon."
Bridgestone/Firestone North American Tire LLC will begin shipping its new Bridgestone Potenza RE750 in April. The tire features a unidirectional tread pattern, and has been engineered to reduce road noise, even as the tread wears, according to the company. It also has Bridgestone's trademarked Rim Guard design -- a raised rubber edge that acts like a bumper to protect wheels from curb damage.
The Bridgestone Potenza RE750 will be available in 15-, 16-, 17- and 18-inch sizes in April. Eight sizes, including 255/35WR20, will be introduced on May 1.
Size proliferation will continue in June, when three sizes will be added to the lineup: 205/45WR16, 245/45WR16 and 265/35WR18.