Conti: High Performance Segment Offers Attractive Growth Opportunities

Despite the continuing automotive industry downturn, Continental says it sees attractive opportunities in the high performance tyre market segment. Continental AG board member and head of the company’s Car Tyre Division, Nikolai Setzer, says new technologies and investment in research and development will aid Conti’s growth in this particular market. He also believes the company can boost its replacement market business through further success with OEM customers.

“In terms of car tyres, we are the market leaders in original equipment and in the winter tyre segment,” said Setzer. “When it comes to product characteristics, we place the greatest value on short braking distances and maximum safety. Taken together with the lowest possible rolling resistance level, this enables us to combine safety and environmental aspects. These are two of the mega trends we have been pursuing successfully for many years.”
According to Setzer, Continental wishes in particular to gain a greater share of the high-performance summer tyre segment (tyres approved for speeds above 240 km/h or 150 mph): “For a start, with over six per cent annual growth until 2012, this is where we see the largest and most profitable market growth in the next few years. In addition, our strong technological bias clearly makes us highly competitive in this particular segment.”

“Last year overall a good 15 million of these tyres – which are manufactured in 17-23-inch sizes – were sold on the markets in Western and Central Europe. By 2012 we expect demand to rise to 20.4 million units, equivalent to growth of over 35 per cent versus 2007,” he added.

The UK, Germany, France, Italy and Spain are the main markets for these UHP tyres, Setzer reports. “The first two alone account for almost half of all sales in this segment,” he stated. “However, it is in South-West Europe that we expect sales of high-performance tyres to increase, with growth as a percentage being even greater than in the UK and Germany.”

Continental has already systematically invested in new products in recent years to underpin and expand the company’s position in Europe. “The ContiSportContact 5 P – Continental’s new model for very sporty cars – will be launched in spring. Its counterpart, the ContiSportContact 5, will then be ready in spring 2011. We already had approvals for our new high-tech ContiSportContact 5 P from several car manufacturers such as Mercedes-Benz AMG and Audi – months before its launch due in spring this year.”

According to Setzer, original equipment approvals in the high-performance sector are particularly likely to ease the way for later success in the replacement market: “Once again the Original Equipment business contributes towards the generation of know-how and subsequent transfer of this expertise to tyres for the replacement market,” he noted. A given example of how well this transfer works is Continental’s run-flat systems, which are successfully sold in both the original equipment sector and the replacement market. “We have a wide range of graduated solutions to suit almost all vehicle categories and manufacturer philosophies – from the self-sealing ContiSeal tyre right through to the ContiComfortKit,” Setzer explained. “In the field of UHP tyres, we can use the example of the ContiSportContact Vmax with its standard approval of 360 km/h (225 mph) to clearly demonstrate that close co-operation with the top vehicle manufacturers and high-end customisers is an essential part of technological leadership in the high-performance sector in particular – and thanks to the existing high level of know-how in our research and development team, we will not need to get involved in racing series, now or in the future.”

In Nikolai Setzer’s opinion, these new developments and further investments in research and development put Continental on the right track for generating growth through technological leadership in this attractive segment. “Now would be absolutely the wrong time to make short-term cuts in important R&D investments and projects,” he warned. “Worldwide competition and the demands for future solutions to individual mobility continue to increase. As Europe’s leading tyre manufacturer, we therefore want to convert our head start in terms of expertise into additional sales in the UHP segment, through constant advances in product development.”