Far From Frozen

With less than 1 per cent of the total UK market, no-one is saying the cold weather segment is huge, but speaking to influential market representatives reveals that the last couple of years have seen the industry make renewed efforts to raise awareness, emphasising both the safety benefits and profitability that cold weather tyres offer. Some manufacturers are even expecting the segment to total 3 million units “in the medium to long term.” Tyres & Accessories spoke to the leading cold weather players and asked what progress they have made and what’s happening next?

In short the answer is growth. Many of the manufacturers surveyed by T&A said 2005 was a good year for cold-weather sales, while all were positive about their performance this year. T&A estimates, based on Europool figures suggest that almost 54,000 non-truck winter tyres were sold in the UK last year, up almost 15 per cent on 2004.

This positive performance could be explained by the adverse weather endured by many people across the UK last winter, but last year also saw the increased sales efforts from segment stalwarts (like Continental and Vredestein) and an influential decision from Michelin to put its weight behind cold weather tyres. Since then Cooper and Marangoni have also released new winter products onto the market, With Pirelli and Goodyear Dunlop increasing their offerings. Some Marangoni dealers in the North East of England told T&A the were particularly pleased with the initial response to their cold weather products.

A retail perspective

Tracey Hyem, Continental Tyre UK passenger product brand manager, credits retailers for “actively promoting cold weather tyres and making efforts to educate motorists last season.” According to Hyem, this is another reason “we have seen an up-lift in the market.” These efforts are demonstrated in the steps taken by independent dealers like former NTDA chairman, Martin Rowlands, who runs Tyrefair in Scotland. “From what we’ve seen we expect continued growth in this sector. As a company we shall we adding special pages to our web site featuring cold weather tyres. It is a product that is extremely profitable, brings a great deal of customer satisfaction (because they work) and encourages customer loyalty, particularly when you operate a tyre hotel as we do,” said Rowlands.

According to the man responsible for winter tyres at Michelin, Franke Tanke, the UK market now consists of “anywhere between 70,000 and 10,000 units,” following a 60 per cent growth in sales this year. And what’s more the Michelin representative expects the growth to continue at similarly large double-digit rates in future years. Although they come from a relatively low base, these increases are particularly impressive when seen in the context of the rest of Europe, which has seen growth rates of nearer 5 per cent.

Michelin reports that most of the sales were in Scotland, but adds that inroads were made in many other parts of the UK as well, including Wales, London and Cornwall. Last year Michelin exclusively told T&A the company was piloting winter tyre usage in some small northern fleets. But how has this important part of developing the national market progressed since last year? “Michelin has used several independent and national retail chains to provide local fleets with cold weather tyres. One example is Scottish Ambulance. We plan to further expand this into more fleets and more distributors, throughout the UK,” Franke Tanke commented, adding:

“Due to Michelin’s success in 2005, we are expanding the amount of cold weather tyres which we can deliver next day by 300 per cent. Even though last year’s sizes covered more than 90 per cent of the UK market, it is imperative to have the full range available if you wish to service fleets and further develop the market.”

However, the feeling amongst manufacturers is just as pragmatic as it is optimistic. Cooper’s response was typical in this respect: “We believe the market will continue to grow both in Europe and the UK… but as our winter weather conditions in the UK are less predictable than some areas of Europe, it will probably mean that winter tyres in the UK will never reach the same level of popularity as in parts of Europe.”

Reporting that sales were higher in 2005 than they were in 2004, but declining to give details, Pirelli representatives added to that sentiment: “We expect the market to grow particularly as a result of publicity given to cold weather tyres, but not dramatically.”

Where do we go from here?

However, as good as the growth rates currently are, the market is not as substantial as it could be and is far from the 12 per cent share that can be seen in markets with comparable climates like the Netherlands. So what’s the problem and where do we go from here? One could argue that the manufacturers and associations could already have done more otherwise we would already have a mature market. But on the other hand it is unrealistic to expect things to change overnight, one manufacturer told T&A.

Vredestein UK managing director, Bert Stellinga suggests that the market should aim to increase tyre awareness in general: “It may be possible for the UK market penetration to be as big as it is in, for example, The Netherlands, Belgium, France or some other similar markets. With a lot of work from all parties involved we can increase tyre awareness and build on to create awareness for the importance to change to cold weather tyres when temperatures drop. It may take a while, but with the support from consumer media for example for tyre campaigns such as cold weather and 3mm, we can, as an industry work on a better tyre awareness with British consumers.”

“The biggest challenge we have is to convince people that cold weather tyres are safer than summer tyres in cold weather situations. In the UK market where remoulds and budget tyres are a normal fact of life, Michelin and the other tyre manufacturers and distributors will have a challenge to convince fleets and drivers that it is the best solution. This can only be done by training and communication,” observed Michelin’s Franke Tanke. From Michelin’s point of view, the distributors play a key role in communicating the message to drivers and fleets. Without national wholesalers, regional fleets and national fleets (comprising roughly a third of the UK market) we will have difficulties getting the products, and being exposed to the idea,” adds Tanke

Explaining that Goodyear Dunlop’s cold weather tyre sales have increased by around 10 per cent year-on-year, company representatives told T&A that their strategy is, like Vredestein, to increase overall product awareness. The difference is that the company says it wants to promote products designed specifically for the stereotypical year-round British weather. In other words rain. “Certain markets have the requirement to fit winter tyres by law. Other markets have significant snowfall and have a market demand. UK winters are generally milder, but wetter, than central Europe and we have experienced increased interest in rain tyres such as the Goodyear HydraGrip in the UK, rather than pure winter tyres,” said a Goodyear Dunlop spokesman.

As this article’s headline and various companies’ sales figures indicate, the embryonic cold weather tyre market is “far from frozen” – both in terms of development and the desire to distance itself from the snow mentality. However, as Martin Rowlands put it: “the development of cold weather tyres is a bit of a chicken and egg situation.” So, let’s give this successful cold weather tyre dealer the last word: “The cold weather tyre is a technological marvel but the progress that is made within the segment, will largely be about imparting knowledge to the vehicle user, either through face to face discussion or through the dissemination of information using the web and advertising.”