UHP tire market showing strength coming out of pandemic

So if car enthusiasts are called gearheads, what's a tire enthusiast called?

Treadheads? Probably not.

Being part of the motorhead population not only means paying attention to things such as horsepower and suspension systems. There's also plenty of interest in the tires that move those performance vehicles.

True autophiles know their wheels and are not afraid to spend the extra cash to outfit their vehicles with ultra-high-performance tires. But UHP tires also are not the sole domain of the automotive illuminati.

As product planner for Bridgestone Americas Tire Operations, U.S. and Canada, part of Brad Robinson's job is to keep his finger on the pulse of the UHP market.

"The UHP tire segment remains strong: Despite a decrease in sedan sales, the popularity of sports cars, and accordingly the UHP tire segment, continues to hold strong.

"Much of that can be attributed to the market shift toward CUVs, SUVs and light trucks, where consumer demand for sportier models with more power and responsiveness are driving the upward trend in UHP tires," Robison told Tire Business in an email interview.

"Consumer expectations of performance tires continue to rise: Not only do consumers want a tire that delivers ultimate grip and handling, but they also want a tire with longer wear life and all-season performance.

"Consumers today are doing more research about the products available in the market, and they want a tire that performs for a long time and across a variety of seasonal conditions," he said.

Nexen Tire America Inc. views UHP tires as an important growth segment and provided some perspective on the market.

"The UHP segment is still seeing growth, even with trends continuing to move toward CUVs and SUVs," Jay Lee, Nexen product planning director, said.

"While the performance vehicle market might be reducing in terms of vehicle launches, we continue to see the volume differences offset by an increase in performance CUVs and SUVs.

"Some CUV platforms now demand V- or W-rated products, showcasing the trend toward UHP. With an increase in OE speed rating demands as well, all-season UHPs are driving growth in this market. We are seeing UHP tire sales showing significant growth year over year," he said.

A changing landscape for vehicles, one where higher performance is being sought out by more and more drivers is helping to drive growth in the tire segment, Lee said.

"Over the years, original equipment vehicle manufacturers have developed and tuned CUVs and SUVs with more performance-focused features. The result is a healthy and growing UHP tire market," he said.

Bridgestone's Robison agrees.

"The UHP OE market is strong, driven by the continued presence of sports cars, sports sedans and sporty CUVs among new vehicle sales. In these categories, we've seen the OEMs engineering the cars for higher performance over the years, and as a result, they have been equipping them with higher speed rated tires," he said.

"This has shifted the tire market for sports cars/performance vehicles from high performance tires to ultra-high-performance tires and these new vehicles will continue to fuel the replacement demand in the future," Robison said.

Both Bridgestone and Nexen see robust UHP tire demand continuing.

"Looking into the future, Bridgestone believes UHP is going to remain strong in the near-term for both sports cars and sports sedans. In the longer term, we believe the desire for UHP products will remain strong as the demand for sporty CUVs continues to grow in the market," Robison said.

Lee added: "As the trend toward higher performance vehicles continues to grow, the trend for larger tires and higher speed grades is expected to continue."

Focus on UHP

UHP tires represent the key segment in the tire industry, Robison said, and remain a focus for Bridgestone.

"UHP all-season tires are ideal for consumers who live in a region that gets some light winter weather—essentially, they want a tire that provides sporty handling, great wet and dry grip, and mild winter performance," he explained.

"UHP summer tires are designed for someone who wants maximum wet and dry grip, and sporty handling. These tires work best for consumers who live in markets with very mild winters such as Florida or Southern California, or for consumers who plan to switch to a dedicated winter tire in the colder months of the year," Robison said.

Nexen said there are obvious warm-weather areas where UHP tires traditionally have been more popular.

"Regions dominated by summer environments, such as California and Florida, have strong UHP segments. That being said, as sales of high-performance CUVs and SUVs are expanding throughout the United States, UHP sales are showing an even growth regardless of region," Lee said.

While vehicle preferences are changing among consumers as fewer and fewer cars are being sold, the demand for "responsive handling and UHP levels of grip will continue to be desired by drivers," Robison said.

With the nation coming out of the grips of COVID-19, Nexen reflected on market conditions during these difficult times.

"During the COVID-19 period, almost all tire companies were affected by a decrease in the sales of UHP tires as well as other tire segments," Lee said. "The trend of vehicle performance enhancement will continue, and the tire market will also accelerate into the UHP tire segment according to vehicle trends."

Bridgestone indicated there was an overall decline across all tire categories and segments due to the virus.

"As we are opening back up, tire demands are picking back up across all categories," Robison said.

Dealer perspective

Cincinnati-based Tire Discounters, which operates 140 stores in six states, reports that entry-level UHP demand has increased, but supply has been challenging. The supply challenges started in the second half of 2020 and have carried into 2021.

Jeff Campbell, chief supply officer at Tire Discounters, said several factors contributed to this trend.

"First, it was due to factory shutdowns during the pandemic, then tariffs on Southeast Asian imports." Campbell said. "Now, there are shipping container shortages due to unprecedented consumer goods demand.

"Overall, we do see demand continuing to increase in the UHP market, while price point puts a strain on consumers. Manufacturers that can supply a value line will fill a much-needed void and take advantage of the market," he said.

Tire Discounters also sees the ongoing electrification of vehicles as a factor in the use and longevity of UHP tires.

"Tires do not last as long on electric vehicles, so we see the replacement frequency increasing with the growth of electric vehicles driving up the unit volume in UHP. These vehicles are much heavier than their gas-powered counterparts and, coupled with the need for lower-rolling resistance, has decreased the effective mileage rate of tires," Campbell said.

He expects "the price point for tires that fit electric vehicles will remain high as the Tier 3 and 4 manufacturers will take a few years to catch up. This will drive up the average ticket for UHP."

Yokohama Tire Corp., the U.S. subsidiary of Yokohama Rubber Co. Ltd., sees the UHP segment as one aspect of the company's success in 2021 following the negative impacts of COVID-19 on the entire tire manufacturing sector.

"In the near term, we see what has classically been categorized as UHP growing, which is an extension of a consistent trend for about the last decade," YTC CEO Jeff Barna told Tire Business.

"However, just like in other segments, the future UHP tires, specifically in all-season categories will be asked to do more than their predecessors, including but not limited to higher mileage and four-season traction," he said.

Pirelli Tire North America CEO Pietro Berardi believes the UHP market always has been resilient, and the company expects that to continue, noting that people with the financial wherewithal tend to invest in higher-value items.

And once they try UHP tires, they typically do not go back, he said.

"I think UHP is going to grow as a segment, and we want to play a major role as we have done," Berardi said.

Tire Business Editor Don Detore contributed to this story.