Yokohama Tire Corp. has been busy so far this year, releasing a number of new products to the market as the company focuses its mission on future growth. Stan Chandgie, executive vice president of sales at Yokohama, discusses the company's plans in this Q&A.
Business was a little slower through the first quarter of 2023, compared with what we had become used to over the course of the previous 24 months, but we're confident that the relative slowdown can be traced to a few specific reasons.
Regardless, we were still able to outpace the market through the first quarter and the sell-out of our brand to the end-user remained strong. As we moved into April, we saw a marked uptick in sales and that trend continued in May.
From a segment standpoint, original equipment has been fairly consistent, while our commercial business lagged a bit behind consumer replacement in terms of year-over-year comps, but again, we've seen a turn in both business units and remain optimistic for the second half of the year.
We deal with a variety of outside factors every year, but the goal is to not allow them to become disruptions. So, while we can talk about inflation and how this might affect higher-end products, we still saw strong sell-out and good demand as a result of some product actions and programs that we put in place late in 2022.
North America never consumed tires directly out of our Russian facility, so I would say that the biggest impact was that we saw some additional truck/bus tire supply for the U.S. in 2022. This supply was originally destined for the Russian market, but was rerouted here and we were able to realize that benefit. As tragic as the war is, we are not forecasting any resulting challenges for this market.
We've definitely seen an easing of the port constraints, which impacted all types of industry, so that has really helped our supply and subsequent fill rates for anything produced off-shore. We've seen the biggest improvement in the reduction of ocean freight rates and spot rates are nearing pre-pandemic, dare I say "normal" levels. However, as soon as the situation seems to improve, we now see some labor challenges in West Coast ports on the heels of increased traffic. Again, we take it upon ourselves to not let outside factors become "disruptions."
Trelleborg represents a complementary business to the Yokohama Rubber Group portfolio that should allow for more balance in terms of margin optimization and protection against potential segment downturns in the future. The business will be operated independent of Yokohama Tire Corp. in the U.S., so we don't foresee any changes to our local business. To the extent that there are common customers, we will make every effort to create sensible programs and work with this new arm of the company to exceed our customer's needs. We took a similar approach when ATG (now YOHTA) was acquired.
We believe there is a window of opportunity for EV-specific tires in the present and near future. While all of our tires are suitable for most EVs, there is an unmet consumer need in the market and our intent is to meet that need, above and beyond what current OE tires deliver. By the beginning of next year, we'll have our first UHP all-season EV-specific tire in the market.
The divestiture of Friend Tire Co. was a strategic decision for us here in the U.S. market, allowing us to focus solely on our core business. From a manufacturer's point of view, our attention continues to be on providing the best service to our customers and this move allows for increased attention in that area. Ensuring that it went to a trusted partner was important for us.
2023 is a fairly busy year in terms of new product introductions. We've already launched our Geolandar A/T XD, which is a commercial-grade, all-terrain tire, and we're expanding our existing Geolandar X-AT into several Eurometric sizes. We have the aforementioned UHP EV tire coming out as well as a couple of customer exclusives.
On the commercial side, we introduced our 114R regional trailer tire at the end of the first quarter and have the 907W winter drive tire to replace our SY767 set to hit the market later this year. In addition to a number of expansions, we're also looking to launch a new fuel-efficient drive tire by year-end or early next year.
If you look at the last few years and what we're set to do in 2023, you can see that we remain committed to managing our product portfolio and attacking incremental segments when and where appropriate.
I think it's safe to say that sustainability is not only a focus, but a commitment moving forward. We continue to use motorsports as a proving ground, and this year we'll debut specially produced Advan race tires at the Pikes Peak International Hill Climb. These tires are made with increased usage of sustainable materials from various naturally derived compounding agents, including oil produced from oil palm nuts and orange peels, as well as recycled iron and rubber recycled from waste tires. As a result, sustainable materials account for about 33% of all materials used in these tires.
Additionally, we'll again use Advan race tires utilizing biomass butadiene rubber made from sustainable materials that made their debut in 2022. These tires replace the petroleum-derived butadiene rubber with biomass-derived butadiene rubber and have achieved a high recyclable material content.
Tire dealers should know that we continue to prioritize their needs and look for better ways to serve them on an ongoing basis. We unveiled new mission, vision and values statements earlier this year. At their core is our desire to be an indispensable partner to our customers and exceed their needs with unmatched values. It's what drives our organization every day.
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