The UK is the second largest 4×4 tyre market in Europe, according to the latest data provided by well-known market researchers and tyre market analysts GfK. During recent discussions with GfK automotive account director Kevin Glynn, we learnt that the Italian 4×4 tyre segment is top of the pile and still growing, the UK’s share of this business is second-place but flat, and Germany takes the bronze medal in this respect, but is growing at nearly ten times the rate of the Italian 4×4 tyre market.
Our review of the year at the end of last year, pointed out how many sources had expected better times for the tyre retail market in 2014. Now as we move forward into 2015, Tyres & Accessories examines the current case for the demand recovery in the market. Many of the wider economic indicators point to broad economic recovery. At the same time pay is rising and inflation is levelling off at around 1 per cent, meaning household incomes should be rising. Furthermore fuel prices are lower than they have been for years. And of course, all this should lead to greater tyre sales volumes and even improved product mix. It is customary to be positive and even optimistic at this time of year, wishing everyone a happy new year etc, but the question remains with regard to our tyre market predictions – will it?
Without being too dramatic, 2014 was a bit of a disappointment. All the macroeconomic and sector-specific indicators seemed to point to 2014 being the year when the tide turned and when sell-out replacement tyre volumes finally started growing again. And yet the market looks like it is going to be down again when the full-year 2014 figures come in. Despite being a fully mature market, the UK car tyre replacement sector has basically been on varying degrees of a downer for the last six years. Things are not as bad as they were, but they certainly aren’t showing the signs of slow, stable growth they once were. With all this in mind, Tyres & Accessories spoke with GfK automotive account director Kevin Glynn in order to get a handle on what happened this year and what we can expect in 2015.
In Tyres & Accessories’ August 2013 Winter Tyre feature, we discussed the UK tyre industry’s continued deliberate steps towards the development of a winter tyre market, and the possibility offered by all-season tyres (which we’ll come to later). While the figures showed that sales of specialised products represent a much greater share of the market than you might have thought in the winter months, the correlative spikes in this figure remain confined to the months in which the weather is coldest. Market analyst GfK’s latest infographic on winter tyres, displayed on this page, goes further towards showing that this trend is prevalent even within the October-January period where winter tyre sales are most popular.
Despite the ongoing political upheaval which has been plaguing the Thais since the start of 2014, replacement car tyre sales grew by 22 per cent in terms of unit volume in the first quarter of 2014 compared with the same quarter last year. This equates to some US$175 million in first three months of 2014.
While Britain has been batter by storms this winter, and while the environment minister announced today (6 January) that some 1700 homes have been flooded this season, it has been relatively warm with much of Britain being buffeted by storms and at the same time experiencing high single-digit temperatures. Tragic for some. Inclement for most. But not the kind of weather that traditionally leads to increased winter tyre sales. Nevertheless, the latest data from market analysts GfK suggests that November sales are significantly up on both the previous month and when compared with the same time last year.
GfK has been carrying out research on car tyres in India since January 2013 and says that, although demand for passenger cars in India has fallen somewhat short of expectations this year, the replacement passenger car tyre market is thriving with robust sales reported for car and SUV tyres in the last three quarters. Car owners in the top 43 cities in India bought more than 5.5 million tyres in first nine months of the year; with the third quarter sales volume having surged by a substantial 11 per cent over the previous quarter.
When Ashley Croft used his farewell Tyre Wholesaler Group annual chairman’s speech to ask how we define what a “premium” tyre is, he captured something of this year’s tyre industry zeitgeist (click here for full coverage of the speech). Of the speech didn’t just deal with this question – it touched on labelling, part worns and what the UK industry is doing to improve the availability of good market data too – but, if the market ruminations of a number of key players are anything to go by, Croft wasn’t the only one to have been raising this question during the last 12 months.
YHI reports that its expanding Malaysia factory has gained some new OE deals including one with Proton as part of its strategy to grow its aftermarket and OEM businesses in Malaysia and wider region. According to YHI, the contract is to supply alloy wheels to Proton for its Satroa Meo R3, Global Small Cars and Saga FLX models. This order of alloy wheels will be manufactured at the Group’s Malaysia plant.
The observation that trends regarding tyre size and speed rating have been tracing an upward trajectory for some time is nothing new, but the clear focus of the world’s largest tyre manufacturers on higher than high performance segments in Europe has perhaps never been so pronounced. Chasing improved profit margins with increased technology is always attractive to those with the capability and the incongruously strong luxury car market has provided an additional reason for migrating business focus from V-rated and 17” tyres into WYZ and 18”-plus territory, according to Automotive market research company GfK.
Increased affluence and the rise of car ownership is creating demand for passenger car tyres in Malaysia’s booming central region. The latest GfK retail audit report shows that sales of passenger car tyres in the high traffic states of Kuala Lumpur and Selangor have been rising consecutively in the last two years, with the first quarter of this year reporting a surge of 14.6 per cent over the same period in 2012.
The UK tyre industry has been taking deliberate steps to develop its fledgling winter tyre market for more almost a decade. Over the years improvements have accelerated with the passing of time. Now, new research produced by market analysts GfK suggest sales are accelerating faster than ever.
Anyone aware of the continued economic fug across the continent might have expected the news that UK and Europe-wide 4×4/SUV tyre markets were depressed in 2012; what you may not have so readily expected was that the macro-trend of increasing sales of V, W, X and Y speed rated SUV tyres would have continued to grow. Yet the latest data from UK market researcher GfK, read in the context of Europool and ETRMA figures, shows that this is exactly what happened during the last year, with more powerful road oriented models continuing to prove popular.
However depressed the market feels to suppliers and despite the legitimate complaints of tough times from the retail sector, the overall UK tyre replacement sales situation in terms of unit sales is actually getting marginally better. According to the latest passenger car tyre sell-out sales data for the first nine months of 2012, compiled by leading international market research firm GfK, things are far from rosy, but there is light at the end of the tunnel.
Market research firm GfK Asia has released a report on the performance of four emerging Southeast Asian tyre markets in the first quarter of 2012; the company found that demand for replacement tyres in the countries investigated – Indonesia, Malaysia, Philippines and Thailand – increased 14 per cent between January and March in comparison with the October to December 2011 quarter. According to GfK’s retail tracking of replacement passenger car tyres across a number of cities within the four countries, some 2,557,600 tyres were replaced in the first three months of the year.