Labelling frostbite: could tyre label guide UK away from winter tyres?

On the snow-dusted face of it, the UK winter tyre market seems to provide a couple of conundrums for those trying to predict and capitalise on demand for seasonal products. The first issue, and the most obvious in many tyre industry professionals’ minds, must be the Oceanic climate of the country, which, coupled with the warm air of the Gulf stream, provides us with only moderately cold winters. The second, a novelty for 2012 is the start of mandatory tyre labelling, which I will come to later.

The two harshest winters for many decades started in 2009 and 2010, coinciding with a huge proportional rise in winter tyre interest, as scenes of icy traffic chaos pervaded many news programmes. The amusement of northern Europeans – even some more hardy northern Britons – as London “ground to a halt” under a couple of inches of snow threw into relief how comically unprepared the country was for proper winter weather. News reports reminded us of how much the UK economy was losing – around £1.2bn per snowy day, according to the Federation of Small Businesses.

We were warned that winter tyre stock, like that of salt for the roads, was dwindling fast. It can probably be put down to more than coincidence that the UK winter tyre market grew by a magnitude of up to 10 times of its size in the mid-noughties during these winters. Latest estimates put the size of the UK winter tyre market at around 500,000 units.

When the winter beginning in December 2011 turned into one long autumn, some of the wind was taken out of the sails of these increases. Any hopes of German-style legislative interventions to create at a stroke a sustained winter market were forlorn, as the seemingly anti-interventionist Coalition government wasn’t made to answer any questions in parliament of the sort raised by Steve Baker MP in January 2011 – and even in that second harsh winter, under secretary of State for Transport, Mike Penning was inclined to leave it to “drivers rather than government to make that decision”.

Contrast this with the view expressed by Continental this month that its recent capacity expansions “mean that the company is well equipped to meet additional demand which could arise, for example due to an increase in the minimum legal tread depth on winter tyres.” Compared with northern European winters however, the UK climate probably justifies the view that specialist winter legislation is a little over the top.

The tyre label and consumer guidance

Penning’s opinion in January 2011 was that “the tyre industry provides advice and guidance” enough for drivers to make an informed decision on winter tyres; a view with which many in the UK probably sympathise. But one piece of legislation that will affect consumer perception of tyres in the UK is of course the tyre label. While the label’s measurements of fuel efficiency, wet grip and external noise are considered fair on summer tyres – if perhaps an insufficient indicator of a tyre’s full technological worth – the effect on winter tyres, which go through the same tests as their summer equivalents, is going to be an inevitably poor appearance for their labels versus equivalent summer fitments.

A Morgan Stanley analyst report on labelling said that retailers should “expect confusion” when drivers see winter tyres’ labels; a factor not entirely helped by the official November start of the mandatory period. While the best winter tyres are expected to reach CC grades, Morgan Stanley makes the point that consumers may believe “a summer tyre labelled A on wet grip class is, all in all, a better choice than a C labelled winter tyre”. A small selection of winter tyres displaying labels already exemplifies this factor (see table).

The table shows results from 11 sample tyres, which were, at the time of printing, those available for Tyres & Accessories to view. Chinese brand, Landsail – a product of four-year old manufacturer, Qingdao Sentury Tire Co., Ltd – claimed label results for its winter-branded tyres surpassing the results achieved by such names as Michelin and Goodyear, at Reifen 2012. They are available from Grouptyre member, Oak Tyres in the UK this winter and it will be interesting to see if their sales are affected by the high label grades they claim. Without wishing to cast any negative aspersions on the highest graded winter tyres in this sample group, it seems unlikely that they actually offer better winter performance than Michelin, Goodyear and Dunlop winter tyres. And of course, all the label results really say is that they offer better fuel economy and wet grip in summer conditions than the premium brand products.

Retailers, manufacturers not concerned by label

However, suggesting these concerns over winter tyres’ labels to manufacturers has so far been met with positive arguments that largely dismiss the concern that labelling may have the unintended effect of misinformation. Goodyear Dunlop consumer director, Juergen Titz suggested that there was “sell-out stability” for winter tyres, and their more “premium nature” meant that drivers who have taken up seasonal products are more aware of their technical benefits.

ATS Euromaster registered its largest ever order of winter tyres in March 2012, anticipating widespread usage amongst business fleet customers, who are amongst those most eager to be assured of mobility all year around (see later in this section). This seems a good argument – if the still comparatively small section of the market was convinced enough of the usefulness of winter tyres in the UK climate to buy a second set of tyres in the first place, why would they change their minds having stayed completely mobile over winter after fitting them?

In the second tier, GT Radial suggested that the question for consumers was simple: “do you want a good label or a good winter tyre?” On the one hand, this illustrates a vision of the tyre label’s purpose fulfilled – to make consumers ask questions about the qualities of the products they are buying, rather than focusing purely on price. A more pessimistic angle is that winter tyres’ labelling issue, if tackled by retailers along these lines, could undermine the development of the necessary trust for the information supplied by the tyre label. Perhaps the key question this winter is: how do retailers convince customers that the newly introduced label helps them to select the best product for their needs, while simultaneously growing interest in winter tyres?