Consumer and retail trends driving growth of tire market e-commerce

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E-commerce has been a key business disruptor across all industries and is forcing change, innovation and growth in the tire market. Still relatively new to the business-to-consumer replacement tire market, online tire sales sites have become significant for consumer research into tire types, attributes, reviews, pricing and availability. This trend and the expansion of e-commerce in general are leading to growth in online sales of tires, according to a new Smithers Rapra report, The Future of E-commerce for Tire Markets to 2023. (TRAC Members receive 15 per cent discount).

Across major tire market segments and geographic regions, the number of B2C replacement tires purchased online is estimated by Smithers Rapra at nearly 100 million units in 2018, or about 6.5% of the global market. This is expected to rise by an average of almost 19% per year to over 236 million in 2023, when the share will be nearly 13%.

 

E-commerce tire sales channel market 2015-23, by volume (million units)

 

Source: Smithers Rapra

 

Value growth will be somewhat higher, at 19.7% per year CAGR, from $7.1 billion in 2018 to $17.3 billion in 2023, faster than unit growth and reflecting modest price increases. While a degree of price competition within the online channel and versus offline retail will continue, the convergence of online and offline channels and the increasing importance of user experience relative to price will support higher prices in the channel over time.

End-use applications

Reflecting the numbers of vehicles in use, rates of tire replacement and rates of e-commerce penetration, the passenger car and light truck (light vehicles) segment is by far the largest, at 81% of volume in 2018, followed by motorcycles (12%) and then medium and heavy trucks and buses (7%). Light vehicles have been and remain dominant in absolute value and volume terms. In unit terms, motorcycles are a distant second, but in value terms, medium- and heavy duty trucks and buses are the next most important, although a much smaller segment.

Trends driving e-commerce tire sales

 

Consumer behaviour

Consumer preferences are ultimately the main market drivers for tire e-commerce with technology and retail developments enabling the change. Consumer behaviour and retail trends behind the uptake of e-commerce in tires include price sensitivity, reduced brand loyalty, time sensitivity and, increasingly, a desire for an omni-channel, which blends features of online and offline channels (already the case to some extent due to tire installation requirements).

Fitment proliferation

Fitment proliferation, the increasing number of available tire sizes, is also contributing to the growth of tires sales via the internet. This has been driven in part by the increase in rim diameters and the greater use of high-performance tires as OEM fitments, which is putting a strain on physical showroom and inventory space. E-commerce options help retailers and customers alike with education and availability. 

Growing economies and emerging markets

General economic and demographic growth serve as top drivers for tire e-commerce. B2C replacement tire e-commerce was initially a phenomenon of developed markets, led by Western Europe, followed by the US, which still enjoy the highest penetration rates. However, Asia-Pacific has already become the largest in unit terms and is on track to pass Europe in value terms during the forecast period, due to its large population and rapidly growing tire market (mostly motorcycle tires). Greater internet penetration and e-commerce readiness in developing markets are fueling the expansion of online tire sales. Very rapid growth will come from Eastern European countries and emerging economies such as China, India and Brazil, where levels of e-commerce penetration and vehicle density are comparatively low and growing.

For more information on the Smithers Rapra market report The Future of E-commerce for Tire Markets, visit https://www.smithersrapra.com/market-reports/tire-industry-market-reports/the-future-of-e-commerce-for-tire-markets-to-2023

Bridgestone Americas Announces New Executive Hires for Procurement, Enterprise Project Management

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Bridgestone Americas, Inc. announced new senior hires to lead business functions and better enable the company’s growth, Bridgestone says.

Rebecca Vest has joined the company as senior vice president, procurement and strategic sourcing partnerships, and Andrea Arrowsmith joins the tiremaker as its vice president of transformation initiatives and enterprise project management office (EPMO).

Read the source article at Tire Review

Nexen Tires wins Good Design Award for Winguard Sport 2 tire

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Nexen Tire announced that the Winguard Sport 2 received an award at the ‘Good Design Awards 2018.’

The awarded Winguard Sport 2 is a premium ultra-high performance alpine/studless Passenger Car Radial (PCR) tire that provides the optimal driving experience in the snow with a winter reindeer and ski plate as its motif. It has been evaluated as a premium winter tire for its excellent grip and stable performance in the snow with its unique 3D winter kerf and zigzag groove.

Read the source article at Traction News

Vietnam to promote value addition to NR

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Badly hit by prolonged drop in natural rubber (NR) prices, Vietnam, the world’s third largest NR producer, plans to boost domestic consumption by promoting the manufacturing of rubber products such as tyres, gloves, automobile spare parts etc for both domestic and export markets.

Globally, unprecedented price falls, adverse weather and growing usages of synthetic rubber are pushing traditional natural rubber growers to other agricultural commodities. The same trend is seen in Vietnam too. Rubber growers are increasingly switching to fruits trees, cashew and pepper. Some are doing inter-cropping and converting only a part of their rubber plantations.

Read the source article at Rubber Asia

Deep rubber ties push ExxonMobil forward

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HOUSTON—ExxonMobil Chemical Co. operates in three main elastomer markets, and in each case the firm was involved right from the start.

That means the Houston-based business of ExxonMobil Corp. has seen its ExxonMobil butyl rubber business operate for roughly 80 years, its Vistalon-brand EPDM unit for 55 years and its Santoprene-brand thermoplastic vulcanizate operation—the baby of the family—for more than 40 years.

And with that history, the company believes it has the knowledge, the technical know-how and the supporting business in place to continue achieving success now and in the future, whether that means in traditional businesses or the evolving new world of transportation, said Kurt Aerts, ExxonMobil vice president for specialty elastomers and butyl polymers.

Read the source article at Rubber and Plastics News

Kumho to supply technology to new Pakistani tire player

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SEOUL, South Korea—Kumho Tire has agreed to provide tire manufacturing technology to a Pakistani battery producer that is planning to branch into tire production.

Read the source article at Rubber and Plastics News

Yokohama Partnering with Tribology Laboratory to Study Friction in Icy Conditions

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Yokohama Rubber Co., Ltd., is working with the Tribology Laboratory headed by Associate Professor Iwai of the College of Science and Engineering at Kanazawa University, to develop technology to visualize rubber’s frictional state of contact on an icy surface. The new evaluation technology will enable the discovery of new compounding agents with excellent water absorbency and facilitate more precise development of tread patterns that deliver higher drainage performance.

Read the source article at Tire Review

Rapid EV growth to 2028 will drive changes in tires, new Smithers Rapra report says

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As part of the biggest automotive industry disruption in recent history, tire makers are increasingly focusing their business strategies on serving the electric vehicle market.  Electric vehicles (EVs) will make up a relatively small part of new vehicle sales and an even smaller part of the global vehicle park by 2028, but the segment is still exhibit dynamic growth.

In its market report The Impact of Electric Vehicles on Tires to 2028which is scheduled for release in October, Smithers Rapra estimates the number of EV passenger and light goods vehicles and the EV truck and bus segment will grow to nearly 432 million units with a CAGR of 35% over 2018-2028. This same segment is forecasted to reach nearly $33 million in value. Passenger car/light goods vehicles are forecasted to drive most of this volume and value growth.

As a baseline for comparison, the International Energy Agency (IEA) estimated that there were over 750,000 new Battery Electronic Vehicle (BEV) and Plug-in Hybrid Vehicle (PHEV) registrations around the globe in 2016.

Smithers’ research into regional development shows that China will be by far the biggest electric vehicle market due to government policies to reduce pollution and dependence on imported oil. Most importantly, China’s government desires to dominate the industry.

Tires for hybrid vehicles will have more emphasis on low rolling resistance. Tires for plug-in electric vehicles (PHEVs) and especially for BEVs will need to handle greater torque generated by the battery, extra battery weight and the requirement for reduced cabin noise. Vehicle weight distribution is also likely to be significantly different, which can affect tire design.

The main drivers for tires to enhance EVs include fuel efficiency, grip, load bearing, wear, noise and vibration, overall property balance, air retention, and puncture resistance. Fuel efficiency is the most important issue. By 2025 US CAFE standards for passenger cars/light goods vehicles and trucks and buses indicate targeted MPG for car fleets should be an average 54.5. In comparison, OEMs are focused on long-range EVs that provide 200 or more miles on a single charge.

Current market influencing trends on EVs and tire development include reducing CO2 emissions, the speed of technological change, the increasing affluence and growth of the middle class in emerging/BRIC markets, urbanization, and aging populations. Also important is the greater use of sustainable materials in tire construction, increased emphasis on recycling, and growing fleet operation.

The Smithers Rapra market report The Impact of Electric Vehicles on Tires to 2028offers in-depth analysis of the growing electric vehicle market and its influence on tire development and manufacturing.

Smithers Rapra estimates for the next 10 years the strongest growth for Mild Hybrid quickly followed by BEVs for the passenger car/light goods vehicles plus the truck and bus segment

Global Tire Recycling Market Analysis Report 2016-2024

According to Goldstein Research, global tire recycling market is expected to grow from USD 0.95 billion in 2016, at a compounded annual growth rate of 2.1% over the forecast period 2016-2024. The increasing environmental concerns related to CO2 and scrap tires has led to adopt new strategies for recycling and reusing the waste tires and thus inducing the growth of the market.

Read the source article at Express Press Release Distribution

Pirelli revamps cyber fleet management systems

HANOVER, Germany — Pirelli & C. S.p.A. has revamped its Cyber Fleet solution, the digital system dedicated to monitoring and managing fleets, and is displaying the new products at the Hanover IAA Commercial Vehicles show, which runs through Sept. 27.

Read the source article at Tire Business