Reducing rolling resistance of tires remains a prime importance for the tire industry. With rising gasoline prices, awareness of the Kyoto protocol as a given, the Euro 5 norm demanding for decreasing carbon dioxide emission, the International Energy Agency focusing on tires to reduce fuel consumption and the California Energy Commission releasing legislation on tire efficiency, the challenge to tire engineers and compounders to address fuel efficiency, i.e. reduced rolling resistance of tires, remains highly actual. Several approaches (varying polymers, fillers, etc.) have been tried or explored but each approach has its own advantages and drawbacks in terms of balance between performance and cost.1-3 Recently Teijin Aramid has introduced chemically activated aramid fiber granules (Sulfron) that reduce compound hysteresis significantly, which translates into better rolling resistance or fuel economy.3-10 This paper presents the results on our latest research in this area focusing on improvement in rolling resistance, heat build-up, flex and dynamic properties. Compounds have been engineered to improve the hysteresis characteristics with a positive effect on wear and tear resistance. Tire test data are presented to demonstrate the improvement in rolling resistance, durability and wear characteristics. A mechanistic view will be provided to explain the advantages.