2023 tyre industry trendsMonday 27th February 2023
The tyre industry is currently having to accommodate consumer behavioural changes and ongoing supply chain challenges. However, with a strong insight into the market and years of experience, we are agile and ready to ensure we have the right tyres – at the right price and time – for the market.
There has been an ease in some logistical pressures within the supply chain such as high shipping prices, access to and processing at ports and speed of delivery, which means the supply chain is moving more freely. But, there are some new challenges facing the industry.
At the moment tyre manufacturers are facing issues with raw materials, as a result of the ongoing conflict in Ukraine. Key materials used in tyre production, for example carbon black, have been in much shorter supply due to a large part of their production being Russian based. This is having an effect not only on pricing, but also manufacturers’ volume capabilities.
Meanwhile, as shipping prices continue to drop, the gap in pricing between budget and premium tyres is getting much wider. The cost of budget tyres, traditionally produced in the Far East, is dropping quickly as the freight costs make up a significant part of the landed price we see in the UK. As a result, premium tyres, which rely more on European production, will continue to see higher pricing.
At Davanti, despite these turbulent times, we’ve managed to keep our prices very stable, so we’re now the best priced mid-range tyre on the market. We remain committed to providing our retail partners, and ultimately the consumer, with the best possible price while also maintaining market-leading availability levels.
It’s important to mention whilst independent garages are facing such an increase in the costs of running a business, selling a well-priced tyre now more than ever could increase profits and help with maximising margins at a time when their overheads are soaring.
Increase in the average age of vehicles
It has been well documented in recent months about the issues relating to sourcing new vehicles – only 1.6 million new cars were registered in the UK in 2021, down 28.7% compared with pre-COVID numbers.
This in turn affects the average age of cars on the road – the average age of a UK car is now over 8 years, approaching 9 – the highest figure since records began, with almost 10 million vehicles from 2008 and earlier still on the road.
And whilst the average age of the car increases, the motivation to put premium tyres on an older car dwindles. This leaves premium tyres facing a challenge – but leaves mid-range quality, such as Davanti, with an opportunity. As the cost-of-living crisis shows no signs of slowing down, every penny will count in 2023 and even more so with a distress purchase such as tyres.
Larger rim sizes
Over the last decade we have also seen a trend in the UK for new vehicles to come with larger rim sizes as standard, as manufacturers offer larger wheels on higher spec cars which they’re more motivated to sell to consumer – and in turn this heightens the cost of the replacement tyre. As a result, customers with say a 7-year-old vehicle, may have 19 inch+ alloy wheels where the costs of replacing the tyres becomes disproportionate to the value of the car, reducing the likelihood the owner will invest those sums – and here lies yet another opportunity for mid-range tyre manufacturers in 2023.
Rise in all-season tyres
With the UK facing a cost-of-living crisis and drivers having less disposable income, people are not only keeping their tyres on for longer but also looking to be savvy when it comes to tyre choice.
In England, where there aren’t bad winters or incredibly hot summers, all-season tyres make economic sense to a consumer as they can avoid switching over from summer to winter tyres every year.
We have recently launched the Alltoura 4-Seasons range, covering car and SUV fitments. We’ve already seen significant growth in sales of all-season commercial van tyres too. With more of our dealer network – and garages in general – promoting all-season tyres, we are expecting to start seeing more consumers choosing all-season car tyres.
As we progress through 2023, it will be interesting to see how the industry adapts to these challenges and any emerging new trends.
Read more about our 2023 predictions on Tyres & Accessories.