High-value-added philosophy: Goodyear’s new

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High-value-added

Goodyear’s new WeatherReady embodies that philosophy

By Bob Ulrich

On the surface, the tire industry appears to be relatively stable. As Goodyear Tire & Rubber Co. Chairman, CEO and President Rich Kramer likes to say, “We’re in an industry that’s over 100 years old selling essentially the same product, the inflatable tire.”

In reality, the industry is ever-changing, offering new segments of growth and profitability to manufacturers and dealers as technology advances. High-value-added (HVA) tires are the latest trend.

The general definition of HVA tires is 17 inches and above, which takes them out of broad-line sizing. At least one prominent tire manufacturer defines them as 18 inches and above. Either way, they are considered high-margin segments.

Kramer told dealers attending the 2017 Goodyear Customer Conference in Orlando how important HVA tires are to the company. “We really love that as a business and an industry,” he said. “Why do we love it? Number one, we’re making more of them than we ever have before to be a better supplier for you. Number two, it gives us the opportunity to demonstrate our ability to manage complexity ahead of our competition. That’s important for us. “What does it mean when I say manage complexity? Let me give you an example.

Goodyear’s new Assurance A lot of you have

WeatherReady has an asymmetric been in the tire tread pattern. The tire will replace b u s i n ess f o r a the AssuranceTripleTred. long time. You’ll appreciate this. When we used to make a tire for the OE manufacturers, we could make one tire that could be sold across multiple manufacturers.

“Of course, that tire was tuned and specialized for the various vehicles, but we could make a tire that had utility across the spectrum,” Kramer said.

“I have to say those days of making long runs of similar tires are gone. The best example is the Chevy Malibu. You all know the Chevy Malibu, sort of a mid-tier sedan, great car, but certainly not the highest-end vehicle out there. The Chevy

One of the highlights of the dealer conference was the remarkable story of Jose Gomez and Elsy Auto Repair Inc. in Newark, N.J. Gomez said thanks to Goodyear, he “easily” sells more tires a week today than he did the entire first five years he was in business. “I have to say I don’t ever recall seeing a more powerful example of what our products and services can do,” said Goodyear Chairman, CEO and President Rich Kramer.

Malibu today comes in seven different trim levels. Each with (its) own specific premium tire fit.

“Imagine what that does to the design of a tire, the manufacturing and distribution,” he said. “Imagine what it does to your inventory, and imagine what it does to that customer who comes in wanting that specific tire on that specific day.”

OEMs want HVA tires

Kramer said there is more complexity in the tire business than ever before. “It’s coming from the OEM demands. It’s coming from the SKU explosions we’re seeing. It’s coming in materials and components. And it’s coming certainly from consumer expectations. So I have to say the days of just building a factory and getting in the business, good luck. Complexity is in every part of the tire business.

“To be successful in today’s competitive and complex tire industry, you must get everything right. To manage complexity, it’s like solving a Rubik’s cube. You can’t just get one side the same color, you have to solve for all sides. Few companies can do that. We believe that Goodyear can.

“We look at complexity as a welcome trend in our business, and the increased demand for complex HVA tires driven by those OEM demands are creating strong segments of profitable growth for us. And to be clear, our goal, Goodyear’s goal is to win and thrive in that environment and do it with all of you as our partners. That’s where we’re headed.”

Assurance WeatherReady

Goodyear emphasized Kramer’s point by introducing the Goodyear Assurance WeatherReady to its dealers. The premium all-season HVA tire features evolving traction grooves that

provide “like new” traction as the tire wears. In addition, 3D Treadlock Technology Blades provide predictable traction in turns when the weather changes.

Other specialized tread features include: • An asymmetric tread for traction in any weather. • “Sweeping tread grooves” that force water away from the tread. • Zigzag biting edges designed to provide dependable grip on snow and ice.

The Assurance WeatherReady is Goodyear’s best traction tire ever, said Andy Traicoff, vice president of consumer sales and customer development for the U.S. and Canada. It is superior to the tire it will eventually replace, the Assurance TripleTred, in wet cornering; snow and ice acceleration and deceleration; snow and ice braking (“a 15% improvement on ice”); and noise reduction, both new and worn. It maintained its dry traction, cornering and stopping performance versus the TripleTred, said David Reese, director of product marketing. It also has the three-peak mountain snowflake symbol stamped on its sidewall.

Goodyear will begin rolling out sizes in August (see sidebar). What the future holds

In his keynote remarks, Kramer described the emergence of a “new mobility ecosystem” driven by consumer attitudes and rapid advances in technology. “The new mobility ecosystem starts with changing attitudes of mobility.”

Ultimately, the new ecosystem will be earmarked by a shift from individual vehicle ownership to ride-sharing; that includes the adoption of autonomous vehicles.

Kramer concluded bysaying that even with such dramatic shifts in the future of mobility, the tire industry remains relevant and the need for tires will remain robust. ■

Goodyear reinforced its philosophy to the more than 1,000 dealers in attendance: The company will key on “high value-added consumer and commercial products in high margin segments,” said Steve McClellan, president of Goodyear Americas.