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Tires and Rims - US - December 2011

SCOPE AND THEMES
What you need to know
Definition
Data sources
Sales data
Consumer survey data
Advertising creative
Abbreviations and terms
Abbreviations
Terms
EXECUTIVE SUMMARY
The market
Independent tire dealers are the retail leader
Automotive dealerships are spending more on tire marketing
Passenger tire sales increased 7.7% in 2011
Figure 1: U.S. sales of passenger tires, by retail channel, 2006-16
Figure 2: Fan chart forecast of total retail sales of passenger tires in the U.S. and Canada, at current prices, 2006-16
Market factors
Fewer miles driven as compared to last year
Figure 3: Miles traveled in the U.S. by month, 2009-11
Older vehicles on the road increases the likelihood of tire replacement
Figure 4: Median age of automobiles and trucks in operation in the U.S., 1995-2010
Five companies control 85% of all U.S. tire sales
Figure 5: Manufacturer share of retail sales of replacement tires, including passenger tires, light truck tires, truck tires, farm tires, and off-the-road (OTR) tires, in the U.S. and Canada, 2010
The consumer
Figure 6: Tire, rim, and tire/rim packages purchased in the past 24 months, December 2011
Nearly seven in 10 tire buyers purchase tires due to wear
Figure 7: Reasons for last tire purchase, December 2011
Most patronized tire retailers vary by region
Figure 8: Location for tire purchase, by region, December 2011
What we think
INSIGHTS AND OPPORTUNITIES
Target consumers by providing tire-check reminders through social networking and phone applications
Tires for electric vehicles (EVs) and hybrids
INSPIRE INSIGHTS
Trend: Perfecting the Details
Trend: Greenfluencers
MARKET SIZE AND FORECAST
Key points
Passenger tire sales increase 7.7% in 2011
Figure 9: Total retail sales of passenger tires in the U.S. and Canada, at current prices, 2006-16
Figure 10: Total retail sales of passenger tires in the U.S. and Canada, at inflation-adjusted prices, 2006-16
Fan chart forecast
Figure 11: Fan chart forecast of total retail sales of passenger tires in the U.S. and Canada, at current prices, 2006-16
MARKET DRIVERS
Key points
Fewer miles driven
Figure 12: Consumer vehicle miles traveled, all U.S. roads and streets, 1991-2011
Figure 13: Monthly miles traveled in the U.S., 2009-11
Figure 14: U.S. gasoline national average price per gallon, 2004-11
Age of the car parc
Figure 15: Median age of automobiles and trucks in operation in the U.S., 1993-2010
Figure 16: Average mileage driven by years of car ownership, and annual miles driven, 2011
Growth of electric and hybrid vehicles
Figure 17: Total U.S. sales and forecast of hybrid vehicles, 2006-14
Figure 18: Projected U.S. supply of electric vehicles, by make, 2011-15
Rims affected by the economy and consumer confidence
Figure 19: University of Michigan Consumer Sentiment Index, 2007-11
Figure 20: Employment status, population aged 16+, 2000-11
SEGMENT PERFORMANCE
Key points
High-performance tires becoming standard, driving growth
Passenger tire volume down 1.4% in 2011
Light truck tire volume has turned the corner and is increasing
Shipments of tires by type
Figure 21: Total shipments of replacement tires for passenger vehicles and light trucks in the U.S. and Canada, 2006-11
RETAIL CHANNELS
Key points
Independent tire dealers are the retail leader
Figure 22: U.S. sales of passenger tires, by retail channel, 2006-16
Figure 23: Indexed growth of U.S. sales of passenger tires, by retail channel, 2006-16
Figure 24: U.S. share of sales of passenger tires, by retail channel, 2006-16
Independent tire dealers leverage auto service to supplement revenue
TBC Corporation is the largest independent tire dealer
Discount Tire is the second-largest independent dealer
Mass merchandisers
Mass merchandisers are in distant second to independent dealers
Sears offering private brands, trails Walmart
Warehouse clubs
Warehouse clubs increase number of stores by nearly 10% in 2005-09
Tire company stores
Sales pick up in 2010 and 2011
Firestone Complete Auto Care
Goodyear Gemini Automotive Care
Auto dealerships
U.S. auto dealers saw decline in 2011, change on the horizon
Miscellaneous outlets
Overview
Pep Boys
Figure 25: Pep Boys store count, 2007-10
Figure 26: Pep Boys revenue split, August 2011
Online buying
LEADING COMPANIES
Key points
Five companies control 85% of all U.S. tire sales
Figure 27: Value sales of replacement tires, including passenger tires, light truck tires, truck tires, farm tires, and off-the-road (OTR) tires, in the U.S. and Canada, 2009 and 2010
Figure 28: Unit sales of replacement passenger and truck tires, by manufacturer brand, 2010
Goodyear and Michelin dominate HP/UHP sales
Figure 29: Market Share of HP/UHP tires, by manufacturer, 2010 *
Bridgestone Americas
Bridgestone sales are up 15% since 2009 but below industry average
Bridgestone renews sports sponsorship agreements
Company facts
Figure 30: Bridgestone Firestone annual sales in the U.S. and Canada for passenger tires, light truck tires, truck tires, farm tires, and OTR tires, at current prices, 2006-10
Goodyear
Goodyear sales increased in 2010
Goodyear Fuel Max Tires still an innovation leader
Company facts
Figure 31: Goodyear annual sales in the U.S. and Canada for passenger tires, light truck tires, truck tires, farm tires, and OTR tires, at current prices, 2006-10
Michelin North America Inc.
Michelin is the third-largest tire brand in the U.S.
Company facts
Figure 32: Michelin annual sales in the U.S. and Canada for passenger tires, light truck tires, truck tires, farm tires, and OTR tires, at current prices, 2006-10
Cooper Standard
Cooper Standard sales largest of five biggest brands
Company facts
Figure 33: Cooper annual sales in the U.S. and Canada for passenger tires, light truck tires, truck tires, farm tires, and OTR tires, at current prices, 2006-10
Continental Tire North America Inc.
Continental is the fifth-largest tire company in the U.S.
Company facts
Figure 34: Continental annual sales in the U.S. and Canada for passenger tires, light truck tires, truck tires, farm tires, and OTR tires, at current prices, 2006-10
INNOVATIONS AND INNOVATORS
Key points
Goodyear Air Maintenance Technology
Bridgestone airless tires
MARKETING STRATEGIES
Key points
Marketing through sporting events common among tire manufacturers
Bridgestone
Online initiatives
Figure 35: Bridgestone Facebook page, December 2011
Figure 36: Bridgestone Twitter page, December 2011
Print advertising
Figure 37: Bridgestone safe roads print ad, September 2010
TV advertising
Figure 38: Bridgestone and beaver saving man TV ad, March 2011
Goodyear
Phone applications
Figure 39: Goodyear Highway Helper phone application, December 2011
Online initiatives
Figure 40: Goodyear Blimp Facebook page, December 2011
Figure 41: Goodyear Blimp Twitter page, December 2011
Print advertising
Figure 42: Goodyear Large Truck Tire print ad, August 2010
TV advertising
Goodyear mixes fantasy and reality, showing it will transport your cargo safely
Figure 43: Goodyear tires are built for stunt drivers and bought by you TV ad, August 2011
Michelin
Phone applications
Figure 44: Michelin European traffic phone application screen, December 2011
Online initiatives
Figure 45: Michelin Facebook page, December 2011
Figure 46: Michelin Twitter page, December 2011
Print advertising
Figure 47: Michelin rims left untouched print ad, April 2010
TV advertising
Michelin Man shows how to save money by having a tire use less energy
Figure 48: Michelin Green X tires with Michelin Man TV ad, August 2011
Michelin Man saves father and son on their wet roads journey home
Figure 49: Michelin dad and son homeward bound TV ad, December 2011
TIRE AND RIM PURCHASES
Key points
Nearly five in 10 respondents report having purchased new tires in the past 24 months
Figure 50: Tires, rims or tire/rim packages purchased new or used in the past 24 months, December 2011
Used tires more popular with younger demographic
Figure 51: Tire/rim packages purchased new or used in the past 24 months, by age, December 2011
Income tracks with tire and rim purchase
Figure 52: Tires, rims and tire/rim packages purchased new or used in the past 24 months, by household income, December 2011
Self-employed consumers more likely to buy new tires
Figure 53: Tires, rims and tire/rim packages purchased new or used in the past 24 months, by employment, December 2011
Optimism about the economy a big driver in new tire and rim purchases
Figure 54: Tires, rims and tire/rim packages purchased new or used in the past 24 months, by optimism about the economy, December 2011
REASONS FOR BUYING TIRES
Key points
Younger respondents most likely to change their tires based on a recommendation
Figure 55: Reasons for last tire purchase, by age, December 2011
Households with kids more likely to buy tires out of necessity
Figure 56: Reasons for last tire purchase, by presence of children in the household, December 2011
RETAIL SOURCES OF TIRES
Key points
Tire stores are top retail choice in a split market
Figure 57: Source of last set of tires, December 2011
Young consumers most likely to use local maintenance shop for tires
Figure 58: Source of last set of tires, by age, December 2011
Higher-income households most likely to buy from car dealerships and branded tire outlets
Figure 59: Source of last set of tires, by household income, December 2011
Most patronized tire retailers vary by region
Figure 60: Source of last set of tires, by region, December 2011
Reason for purchase influences store selection
Figure 61: Source of last set of tires, by reasons for last tire purchase, December 2011
AMOUNT SPENT ON NEW TIRES
Key points
Men and women have similar spending habits on new tires
Figure 62: Amount spent on new tires in the past 24 months, by gender, December 2011
Younger respondents spending less on new tires
Figure 63: Amount spent on tires in the past 24 months, by age, December 2011
Household income correlates with spend on new tires
Figure 64: Amount spent on tires in the past 24 months, by household income, December 2011
Those living in the Northeast and Midwest spend more on tires
Figure 65: Amount spent on tires in the past 24 months, by region, December 2011
TYPE OF TIRES PURCHASED
Key points
Type of tires purchased varies with gender
Figure 66: Type of tires purchased, by gender, April 2010–June 2011
Younger consumers buy greater number and range of products
Figure 67: Type of tires purchased, by age, April 2010–June 2011
Income drives purchasing, shapes choices
Figure 68: Type of tires purchased, by household income, April 2010–June 2011
Region greatly influences tire choices
Figure 69: Type of tires purchased, by region, April 2010–June 2011
BRAND OF TIRES PURCHASED
Key points
Goodyear the top choice among one third of those aged 18-34 and 55-64
Figure 70: Brand of tires purchased, by age, April 2010–June 2011
Michelin leads among affluent households earning $150K+
Figure 71: Brand of tires purchased, by household income, April 2010–June 2011
Region influences Goodyear and Michelin
Figure 72: Brand of tires purchased, by region, April 2010–June 2011
REASONS FOR BUYING RIMS
Key points
Respondents most likely to purchase rims to improve the look of their vehicles
Figure 73: Reasons for last rim purchase, by gender, December 2011
Younger respondents most likely to purchase rims to improve the look of their cars
Figure 74: Reasons for last rim purchase, by age, December 2011
RETAILERS USED FOR RIM PURCHASE
Key point
Specialty and branded tire stores the top two locations for rim purchases
Figure 75: Source of last set of rims purchased December 2011
AMOUNT SPENT ON RIMS
Key point
Respondents are most likely to spend between $101-249
Figure 76: Amount spent on rims in the past 24 months, December 2011
TIRE/RIM PACKAGES
 RETAILER USED FOR TIRE/RIM PACKAGE
Key point
Overview
Figure 77: Preferred location for tire and rim purchase, December 2011
 SPEND ON TIRE/RIM PACKAGES
Key point
Majority of consumers spend $101-749 on tire/rim packages
Figure 78: Amount spent on tire/rim packages in the past 24 months, December 2011
PREFERRED REMINDERS FOR TIRE MAINTENANCE
Key points
More than half of respondents prefer sticker reminder for tire maintenance
Figure 79: Preferred reminders for tire maintenance, December 2011
Age has little effect on sticker reminders but shapes response of text reminders
Figure 80: Preferred reminders for tire maintenance, by age, December 2011
Income drives preferred reminder
Figure 81: Preferred reminders for tire maintenance, by household income, December 2011
IMPACT OF RACE/HISPANIC ORIGIN
Key points
Hispanics and respondents from other races more likely to purchase rims
Figure 82: Tires, rims, or tire/rim packages purchased in the past 24 months, by race/Hispanic origin, December 2011
 REASONS FOR BUYING TIRES
Black respondents more likely than others to wait for a puncture before replacement
Figure 83: Reasons for last tire purchase, by race/Hispanic origin, December 2011
 SOURCE OF TIRES
White respondents most likely to purchase from a specialty store
Figure 84: Source of last set of tires, by race/Hispanic origin, December 2011
 SPEND ON TIRES
Figure 85: Amount spent on tires in the past 24 months, by race/Hispanic origin, December 2011
 TYPE OF TIRES PURCHASED
Black respondents purchasing regular passenger car and specialty tires
Figure 86: Type of tires purchased by race/Hispanic origin, April 2010–June 2011
 BRAND OF TIRES PURCHASED
Goodyear most popular with black respondents regardless of income
Figure 87: Brand of tires purchased, by race and household income, April 2010–June 2011
Figure 88: Brand of tires purchased, by Hispanic origin and household income, April 2010–June 2011
 REASON FOR BUYING RIMS
Black respondents less likely to buy tires while getting other maintenance
Figure 89: Reasons for your last rim purchase, by race/Hispanic origin, December 2011
 SOURCE OF RIMS
White respondents most likely to buy tires at tire specialty stores
Figure 90: Source of last set of rims, by race/Hispanic origin, December 2011
 PREFERRED REMINDERS TO CHECK, CHANGE, AND ROTATE TIRES
More than 56% of all races prefer sticker reminder for tire maintenance
Figure 91: Preferred reminders for tire maintenance, by race/Hispanic origin, December 2011
APPENDIX: TRADE ASSOCIATIONS

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