Over the last year or so it has been broadly noted that the SUV/4×4 sector of the tyre market has been impressively resilient. Not just from the relatively local impact of the UK’s Brexit vote and resulting inflation and slump in certain motor vehicle sectors (in the UK at least). The tyre industry’s also been faced with escalating raw materials costs at a global level.
As our September 2017 article “Strong growth continues in 4×4/SUV tyre market”, sales of new SUVs exceeded 6 million units in 2017, up from fewer than 4 million five years before, with further growth projected to produce regional sales at 8 million new SUVs in 2022. The reason? “The SUV/4×4 tyre market is, of course, following suit: in Europe (including Turkey), ETRMA Europool data projects sales of 18 million in 2017.”
Back in July 2016 a survey of tyre tread depth when brought in for replacement by safety organisation TyreSafe in collaboration with Highways England produced disturbing results. Of nearly 102,000 tyres checked from 810 British retailers almost a quarter were illegal for road use – the equivalent of 10 million potentially dangerous tyres. More worrying was the report that there’s an upward trend in the percentage of tyres with illegal tread depths on replacement (66% percent in 2015 and 70% in 2016). TyreSafe’s alarming prediction was that ‘higher numbers of dangerous and illegal tyres will be driven on the UK’s road’s in 2017’.
Leading UK tyre group, European Tyre Enterprise Ltd (ETEL), has announced a series of promotions within its senior management, including the appointment of a new CEO following Kenji Murai’s promotion to a global position with parent company, Itochu.
When it became a legal requirement for all new vehicles produced and sold in Europe to be fitted with TPMS (Tyre Pressure Monitoring System) back in November 2014 the concept was still unfamiliar to the majority of motorists. In the main it was drivers of early adopter, generally high-end, marques such as BMW and Mercedes who got the benefits in terms of enhanced safety, tyre life and fuel economy. Indeed, even three years ago those manufacturers had been fitting TPMS as standard for more than two decades.
This year Stapleton’s celebrates 80 years since Sydney Stapleton set up his business in a simple parade of shops at 195 High Street, Watford in 1937. An entrepreneur of terrific dynamism and foresight, he was among the few to spot and take advantage of the fast-growing market for tyres. A decade on, in the post WWII years, the company’s total weekly wage bill amounted to the princely sum of £20. It’s safe to say in this 80th anniversary year the wage bill’s grown considerably now Stapleton’s employs some 1,100 staff at eight regional sales offices and eleven distribution hubs nationwide. It’s also safe to suggest that Sydney Stapleton would be staggered by the scale of his old business, with a current stock capacity of 1.5 million tyres available at any given time.
When Sydney Stapleton set up his business in a simple shop parade at 195 High Street, Watford in 1937 he was one of a number of businessmen taking advantage of the growing market for tyres. Growing his business through the 1950s and ‘60s, his personal renown as one of the industry’s most dynamic characters and an entrepreneur of considerable foresight followed. The location of its headquarters in the vicinity of the M1 is testament to this – in the 1960s Stapleton’s supplied replacement earthmover tyres used to build the Watford-Milton Keynes stretch of the motorway.
The UK’s largest wholesaler, Stapleton’s acknowledges this growing interest in SUV tyres while adding that uncertainty in our domestic market as inflation rises, sluggish growth, and the reduced value of the pound are adding to the case for cheaper products in the SUV/4×4 segment. The wholesaler backs up Goodyear’s point that the current market has been good for premium brands, with demand for such products strong in the SUV/4×4 segment.
In any sphere of driving, from motorsports to day-to-day motoring, peak performance doesn’t come cheap – and that goes for the tyres as much as for the vehicles themselves. After all, when you’ve invested in a prestige, state of the art vehicle you won’t want to sully its perfection with tyres that are in any way inferior to those fitted as original equipment – especially since they’re the parts transmitting your vehicle’s raw power to the tarmac and turn it into adrenaline and acceleration.
Almost 10 years on from the trauma of the global ‘credit crunch’ and we’re still not entirely free of the economic aftershock. The resulting times of austerity have made for tough competition for every pound in the motorist’s pocket – and the forecasts suggest even more tough times ahead. In a trade as utterly international as the tyre industry the outcome of the 23 June referendum on the EU was always going to have profound effects – and the marginal victory for the Brexit side predictably has caused dramatic weakening of the pound against both the Euro and the dollar.
Commenting the quality of car tyres available on the market in general, Stapleton’s representatives quoted a motoring journalist by way of response: “The only point of contact between your car and the road, your tyres, can save your life or end it, whether you’re an average Joe or the star of a Hollywood action franchise.’ Ryan McElroy, Carkeys.co.uk, September 2016.
Stapleton’s states that it has for several years engaged in expansion, rationalisation and consolidation of its nationwide distribution operation. As a result, the wholesaler says its new regional hubs and larger delivery fleet are yielding advantages for retailer customers. Wholesale director Nigel O’Hara said the company’s “constant focus on our retailers’ individual needs… sets us apart.” The company’s recent efforts have been in translating the benefits of being a national distribution operation to “real competitive benefits” on a local and personal basis.”
The Tyre Industry Awards have been presented for 2016 during the sold-out NTDA Annual Dinner, this year hosted by the Vox Conference Centre on the site of Birmingham’s National Exhibition Centre. In addition to the various gongs, the NTDA presented Sir Tom Farmer with the National Chairman’s Award for Outstanding Contribution to the Tyre Industry, sponsored by Hankook UK, while Brian Funnell and Lennie Wells were also made NTDA Honorary Life Members. Presented by television personality Suzi Perry, the winners were decided by a panel of leading industry judges, and the results live-tweeted by Tyrepress via its Twitter feed.
At the start of the year, the British car industry revelled in optimism that an all-time vehicle production record would be achieved by 2020 in the UK. The 900,000 cars rolling off the UK’s production lines in the first half 2016 – a sixteen-year high and 13 per cent up on the same portion of 2015 – gave more reason to be hailing this new dawn, and while a significant measure of doubt was added by Brexit, the figures suggest that the growth has come with premiumisation and a sustained boom in SUV manufacturing. High-end marques such as Range Rover drive this new demand and have made the UK Europe’s second biggest premium car producer. In 2010, the premium sector accounted for just 34 per cent of UK production; should trends continue, by 2020 this figure is expected to hit 54 per cent, with SUV and 4×4 models a big part of this.
After years in the making, Stapleton’s is releasing TyreSurf – an e-commerce system designed to help tyre retailers boost profits – on a widespread basis. In short, TyreSurf acts as the retailer’s own bespoke branded, website specially created, maintained, and linked into Stapleton’s. Stapleton’s sees the latest development as “almost certainly the company’s greatest e-commerce innovation since the introduction of ProfitLink at the turn of the millennium”.
For a nation so interested in weather that its obsession has become a national cliché, the UK winter tyre market has continued to elude growth, yet this is not preventing wholesaler Stapleton’s from continuing to make the case for winter tyres. The company stocks a range of premium and house brand seasonal fitments, in which it continues to see potential from both a driver safety and dealer profit perspective. Following the UK’s wettest June since records began in 1910, giving us the impression of a very short-lived summer, Stapleton’s suggested that perhaps it won’t be too much of a wrench to turn our thoughts to the coming winter, the challenges it brings for drivers, and the opportunities for tyre retailers that come in the form of winter tyre sales.