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

curata__IjMRRdxK2bzBjja.jpeg

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

Global Tire Intelligence Report

New Analysis. The world’s tire industry revenues and profitability in the first half of 2018, and analysis of the global situation.

Read the source article at tireindustryresearch.com

CenTiRe sees improvements with tire simulation, but says work remains

curata__LWjYWol2vetjI9F.jpeg

INDIANAPOLIS—The use of simulation has made great strides the past few decades to where it is an integral part of the tire development process, but it still has room to grow, according to the keynote speaker at the ACS Rubber Division Spring…

Read the source article at Rubber and Plastics News

Nokian Tires to build new testing and technology center in Spain

curata__YYcafapfdqCPJw5.jpeg

Nokian Tires has launched the construction of a new testing and technology center in Spain. The groundbreaking ceremony was held this Friday on the grounds of the new center in Santa Cruz de la Zarza. The first test tracks will be completed next year, and the technology center is expected to be fully operational in 2020.

Read the source article at Traction News

The green or low rolling resistance tires market is projected to reach USD 104.23 billion by 2022, at a CAGR of 10.7% from USD 62.68 billion in 2017

LONDONMay 9, 2018 /PRNewswire/ — Government initiatives to reduce carbon emissions and tire labeling regulations are anticipated to drive the green tires market.

The green or low rolling resistance tires market is projected to reach USD 104.23 billion by 2022, at a CAGR of 10.7% from USD 62.68 billion in 2017. One of the most significant factors driving the growth of the green tires market is the increased government initiatives for a green and clean environment. There is a rising concern over factors affecting the fuel efficiency of vehicles and CO2 emissions. Thus, governments across the globe have started several initiatives to reduce fuel consumption and release of greenhouse gases. However, lack of awareness regarding the benefits of green tires restricts the growth of the green tires market in emerging economies.

Read the source article at PR Newswire

Goodyear Unveils Oxygene Concept Tire

curata__JwcQMdH8YsOHGON.png

At the 2018 Geneva International Motor Show, Goodyear showcased its new concept tire and the latest advances on its intelligent tire prototype.

The concept tire, named Oxygene, features an open structure with living moss growing within the sidewall. The tire’s smart tread design absorbs and circulates moisture and water from the road surface, allowing photosynthesis to occur and therefore releasing oxygen into the air, Goodyear said in a press release.

Read the source article at Tire Review

Pirelli, Milan University renew joint research programme

curata__J3zeBaig4ZN1Xr6.png

Milan, Italy – Pirelli & C. SpA and the University of Milan have extended their partnership for another three years, signing an agreement to work on developing innovative materials and technologies for sustainable tires.

The Italian tire maker announced 24 Nov that within the context of the €1.5 million project, the two parties would work on use…

Read the source article at European Rubber Journal

TIP study concludes tire particles safe for human beings

curata__1hCWLIXVPMcjAWo.jpeg

San Francisco, California – Tire and road wear particles (TRWP) do not pose a threat to human health, according to findings released by the Tire Industry Project (TIP) during its biennial meeting in San Francisco  on 17 Nov.

TIP, which is backed by leading tire makers and operates under the umbrella of the World Business Council for Sustainable Development (WBCSD), said extensive ambient air testing had been carried out in major cities of Los Angeles, London, Tokyo and Delhi.

Read the source article at European Rubber Journal

Conti VP to keynote Tire Society meeting

curata__TRIcgEOI6BOcLMZ.jpeg

AKRON — Juan Botero, a Continental Tire the Americas vice president, and Ron Kennedy, managing director of the Center for Tire Research, will be the featured speakers at this year’s Tire Society annual business meeting.

Read the source article at Tire Business

Goodyear executive to deliver ITEC in Focus keynote

curata__QZ7j9sEBJ8JsdJC.jpeg

AKRON—Surendra Chawla, senior director of external science and technology programs for Goodyear, will be the keynote speaker for ITEC In Focus: Reinforcements for Tire Performance.

He will be speaking on tire technology developments and future challenges as they are impacted by industry mega trends.

Read the source article at Rubber and Plastics News