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March 23, 2017 02:00 AM

Study indicates OE brand loyalty near 37 percent

Tire Business Report
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    JD Power
    Michelin, Goodyear, Continental, Bridgestone and Pirelli represent 62 percent of replacement tires purchased.

    COSTA MESA, Calif.—Vehicle owners' loyalty to their OE tire brands is running at about 37 percent, according to the latest J.D. Power OE Tire Customer Satisfaction Study, which is essentially unchanged from 2014 when the research company last measured loyalty.

    Accoring to J.D. Power, the loyalty percentage is based on responses from 29,622 owners of 2015 and 2016 model-year vehicles who were surveyed from October through December 2016.

    To determine the loyalty, J.D. Power asked the owners which brand they chose when replacing two or more tires on their vehicles.

    Among the OE brands singled out in the J.D. Power study, Michelin was the clear favorite at 21 percent, followed by Goodyear (12 percent), Continental (11 percent), Bridgestone (11 percent) and Pirelli (7 percent). These five brands represent 62 percent of tires purchased.

    "Tire manufacturers who have their products fitted to new vehicles have a great advantage over their competitors," said Brent Gruber, senior director, automotive quality practice at J.D. Power. "A large number of vehicle owners do not even consider other brands when buying replacement tires. As long as they have a positive experience with their OE tires, there is a natural tendency for consumers to select the same brand for their first replacement."

    The study also reports that luxury vehicle owners purchase the OE tire brand more frequently for their vehicle than mass market vehicle owners—58 vs. 31 percent. Additionally, a higher share of luxury vehicle owners tend to return to a car dealership (46%) for new tires than mass market vehicle owners—46 vs. 33 percent.

    "New vehicle dealerships can put themselves in a great position to increase service department revenues through tire-related business," Gruber added. "The key is to ensure that dealership tire inventories remain stocked with options that include OE tires and that the service personnel are properly trained about how those tires were specifically engineered to maximize vehicle performance, particularly for luxury vehicle owners."

    The new study also ranks tire brands for quality, based on the survey responses. In this instance, Michelin ranks highest in all four segments—luxury, passenger car, performance sport and truck/utility.

    Satisfaction is examined in four measures: tire wear; tire ride; tire appearance; and tire traction/handling. Study rankings are based solely on owner experiences with their tires after two years of vehicle ownership.

    In the luxury segment, Pirelli ranks second and Bridgestone third; in the passenger car segment, Pirelli ranks second and Goodyear third; in the performance sport segment, Goodyear ranks second and Bridgestone third; and in the truck/utility segment, Goodyear ranks second and Michelin's BFGoodrich brand third.

    Additional key findings include:

    • New vehicles need flat tire solutions: More than half of tire replacements in the first two years of ownership are a result of road-hazard damage, flats or blowouts. A significant proportion of luxury owners reported that their vehicle does not come with a flat tire solution—including either a temporary spare, full-size spare, sealant kit, inflation kit or collapsible spare. However, many luxury vehicles do include run-flat tires, yet owners may not be aware of this.
    • Lease rates increase: Of the 17.5 million new light-vehicles sold in 2016, 30 percent were leased, up from 24 percent in 2013. This figure is key for tire makers because 44 percent of lessees who replaced two or more tires selected the same tire brand as opposed to 35 percent of those who purchased their vehicles.
    • Poor weather traction improvement: Across all four vehicle tire segments, customer satisfaction with poor weather traction has increased, and the number of wet-road traction problems decreased between the 2015 and 2017 studies.
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