Need some good news for once? Ultra-high performance tires have mushroomed into the single fastest-growing tire segment. From 2000 to 2004, sales of UHP tires were up 161%, jumping 32% from 2003 to 2004 alone. In terms of units sold, the numbers look like this: 3.99 million in 2000, 7.9 million in 2003 and 10.4 million in 2004.

In fact, UHP tires have become part and parcel of what the world’s vehicle makers are churning out. “The truth about performance tires,” writes ASE-certified automotive tire expert Frank Ranelli, “is that every car and every driver is a performance driver.” There’s no getting around it. Every Z06 Corvette rolling off the Bowling Green, Ky., assembly line is a customer order. Already sold! Fuel prices be damned.

Yes, consumer spending is down, and fuel prices are up. But don’t become overly cautious and start stripping your inventory of higher-priced tires. Performance tires, including UHP tires, are here to stay, and so is the cost associated with them.

These very special tires are a critical design choice made by automobile engineers. UHP tires will continue to be expensive, and the average cost for all tires will continue to climb, thanks to 21st century technology and rising raw material costs.

Mushrooming Market

So, how large is the UHP tire market – defined as V-rated or higher, 55-series or lower – overall? In 2004, 41.2 million high-performance (H-rated or higher) tires were sold in the replacement market. Of that number, 33.5%, or 13.8 million, UHP tires went to market.

“We are beginning to call this the ‘mushroom’ market segment,” says Bob Toth, brand marketing manager at the Goodyear Tire & Rubber Co. “Once the UHP tire segment was almost exclusive to the owners of exotics like Ferraris and Lamborghinis. Now, they come standard on a four-cylinder Acura TSX in a P215/50VR17 all-season size, Nissan Maximas as a 245/45VR18 size and Chrysler 300C SRT8s as a 245/45ZR20 size.

“When I refer to the ‘mushroom segment,’ I’m talking about two components of growth,” Toth continues. “The first is what we once called the ‘carriage trade’ – people with enough money that they don’t care about vehicle or fuel costs. They have always had money, and they always will.

“The newer component to this market segment is the youth market,” he says. “In a way, they remind us of the hot rodders back in the 1950s. They often buy smaller, sometimes used, vehicles. They like trunk-lid wings, 17-, 18-inch and larger wheels, and many of them will spend the money for UHP tires, if not from name-brand makers, then from the less expensive second- and third-tier tiremakers.”

Toth is talking about a piece of the overall market that has seen many tiremakers from around the globe jumping into the fray. The good news is that the V to Z segment will continue to grow, even though prices and margins in some quarters will not remain quite as high as they were.

“That doesn’t mean margins aren’t healthy for UHP tires,” says Toth. “They are. But, as the numbers of tires sold grows, the margins will come down a bit. A few years ago, the margins on UHP tires were almost unbelievable. No matter, they will remain higher than the industry average overall.”

Exceeding the Need at OE

As sure as tomorrow’s sunrise, UHP tires are becoming the standard for sporty cars and sedans. Fewer dealers are selling a tire based on its speed rating. Instead, tiremakers are instructing their dealers to sell UHP tires on the merits of a noticeable improvement in handling, braking, cornering and accident avoidance characteristics.

A clear example of what’s happening at OE can be seen in the tire choice for the Mazda Miata MX-5, which has a top speed of 131 mph. That’s it: 131 mph. Nevertheless, Mazda has chosen to equip the MX-5 with a 205/45WR17 tire capable of sustained speeds of 168 mph.

Mazda, along with other vehicle makers, has decided to improve performance characteristics by mounting UHP tires with speed-rated capabilities greater than the top speed capabilities of the vehicle. That’s another way of saying that a UHP tire isn’t built for speed alone. Speed capability is simply one feature.

Some mainstream models are now routinely fitted with UHP tires. Pontiac’s Grand Am GT, for example, comes with a 225/50VR16 tire. Its G6 GT model rides on 225/50VR17 tires, while the Bonneville GXP V8 is equipped with 235/50ZR18 tires.

Keep in mind that these models were largely middle-of-the-road entries over the past few years, with the newer GTP and G6 destined to be pretty much the same kind of lifestyle choice. Yet, each has received a UHP upgrade to enhance overall vehicle performance.

The Value UHP Trend

What trends does Toth see ahead? “Lower and wider,” he says. “But, we will also see major tiremakers working hard on their lower-price-point UHP lines. At Goodyear, we have the Eagle F1 premium tire for the owners of exotics, along with the super car tires. These tires are well established. More recent UHP lines like the Kelly Evo-Z are a directional, low-aspect, Z-rated line targeted to the youth market.”

Adam Murphy, brand category manager for Michelin performance and sport products, sees UHP in a different light. “On one side of the equation, we have touring sedans like the Pontiac Bonneville and Honda Accord. On the other side, we have exotics like the Corvette. In 2004, the industry built six million V-rated tires and seven million Z-rated tires. In 2005, we expect a 15% growth in the UHP segment alone, as the evolution at OE continues outward toward more V- and Z-rated tires.”

Murphy says smaller, more fuel-efficient vehicles won’t rule out the continued growth of this market segment. “We not only have small 200-hp cars, but we also have 350-hp luxury sedans. Both fit the UHP category. Ten years ago, 20 vehicle models featured 300 hp or more. Today, there are more than 100 vehicle models sporting that much horsepower.”

Unusual UHP

Murphy stresses that winter tires are becoming an increasingly important part of the UHP market. “We offer the Pilot Alpin PA2 winter tire in both H- and V-rated sizes,” he says. Speaking to the plethora of new tire types, Murphy says Michelin wants to help its dealers take on the growing UHP market with both premium and price-point tires.

“We see somewhat of a decline of S-, T- and H-rated tires in favor of V, W and Z tires for mainstream passenger cars,” says Murphy. “In the middle of all of this, we see a growth of H-rated tires in the SUV market. As more vehicles leave S and T ratings behind, more will come on Vs and higher. We also see more mini-vans coming on H-rated product, an OE migration to larger 18- and 19-inch diameter wheels.

“All of us are now in the business of selling ‘handling’ tires that are quiet and deliver a respectable level of comfort. We must now be focused on selling to the touring and sporty audience,” he says. “The emphasis has changed from speed ratings to delivering what the customer can feel, understand and use every day.”

At Toyo Tire (USA) Corp., Travis Roffler, senior director of marketing, says performance tire growth is virtually out of control in the light truck market. “Big light truck tires with big wheels are the name of the game,” he says. “We can’t make enough tires to fill the demand.”

Although Roffler is talking about tires that don’t fit the strict definition for UHP tires, he knows that the name of the game is all about over-engineered tires like the company’s M/T and A/T light truck entries. “We are seeing wild growth in 33-, 35- and 37-inch M/Ts and 33×20 and 35×20 sizes in the all-terrain tire market,” he says.

According to Roffler, Toyo is also targeting the unsuspecting UHP tire buyer who must replace a set of four 235/55VR17s at a cost of roughly $1,200. That’s quite a ticket for any dealer, and certainly for the consumer who never considered tire prices when they chose their car.

“That’s the way the OEMs are moving us, and they are doing it because people love their cars.”

Roffler is right. Even GM has made sure that its 505-plus-hp Corvette Z06 manages to attain 26 mph on the highway in sixth gear.

“We are now in the business of segment building,” says Roffler. “We are matching horsepower and MPG to the consumer’s wallet, along with the kind of handling these buyers expect from their tires. And, none of it comes cheap.”

Individuality Reigns Supreme

In Holland, where an imperial gallon of premium gasoline costs between $6.50 and $7, and a vehicle’s luxury tax can run as high as 42% of cost, plus a 19% sales tax, UHP tires really reign supreme. That’s because, in Europe, car owners, whether it’s a Ferrari or Ford Focus, will spend money to individualize his or her vehicle.

“Appearance and performance are everything,” says Michiel Kramer, market development manager at Vredestein Tyres North America.

Kramer says a growing number of drivers in the U.S. are becoming interested in the same things as European drivers, with quality at the top of the list and performance right behind. “That’s where Vredestein enters the picture,” he says. “At our modern, automated plant, we specialize in premium UHP tires only. That’s our niche, and what we make in Holland we are bringing to the U.S.”

Kramer knows that Europe often takes the lead in tire technology, with the U.S. quick on the uptake. “In Germany, virtually all motorists change from summer or all-season UHP tires to winter UHP tires. We now see the beginnings of that occurring in the states.”

Kramer believes the U.S market will see more 60,000-mile UHP summer tires, which will be exchanged every autumn for 40,000-mile winter tires.

“We are ready to serve this market segment and expect to play with the ‘big boys,’” he says. “That doesn’t mean Vredestein will become a Michelin or a Goodyear, but we do have the technology and experience to provide UHP tire customers with the kind of tires they want to buy.”

Maybe all of us have forgotten some of the tire-selling rules of the 1970s. We used to say that the fastest, most inexpensive way to improve the handling of your car was to put on a set of high-performance tires.

What was true then is just as true today. You can count on it.

Five Top-Selling Z-Rated Sizes

225/45R17

245/45R17

225/40R18

235/45R17

215/45R17

Five Top-Selling V-Rated Sizes

195/55R15

215/50R17

225/50R16

205/55R16

205/50R16

Controlled Burn

Tire companies are cashing in on the hot sport of drifting. Why shouldn’t you?

Getting sideways. Exceeding the limits of adhesion. Intentional oversteer. These are all phrases that describe one of the hottest motorsports out there – drifting.

If you’re not familiar with this relatively new sport, here’s a synopsis: Drifting is a high-speed, high-horsepower motorsport in which professional drivers intentionally maneuver their cars into sideway skids. Deliberate fishtails and dramatic spinouts define the game.

A sensual sport, drifting is filled with powerful smells, sounds and sights. When you attend a drifting competition, the first thing you notice is the smell of burning rubber. Then, you become aware of clouds of smoke obscuring your vision. And, if you’re not being pelted with tire debris, you’re not close enough to the action. Drifting’s unique sounds – screeching tires, grinding gears and loud music – can be heard for miles.

Sound crazy? It is. But, for ‘drifters,’ crazier is better. Style, not speed, wins a drifting race.

Drifting is capturing the attention of young tuners and enthusiasts all over North America. And, each minute, it’s becoming more organized and more recognized by tire industry observers. First, a little history.

Formula Drift Championship, or Formula D as it’s called, is the first North American professional drifting championship sanctioned by the SCCA. In August 2003, event and marketing management company Slipstream Global Marketing organized the first Japanese-American driver exhibition in southern California. Tickets sold out quickly, and the success of the event eventually launched the formation of Formula Drift Inc., a sister company of Slipstream Global Marketing.

In April 2004, the first-ever Formula D was held in Atlanta. Now in its second season, the 2005 Formula D consists of six separate competitions, which eventually crescendo into a final match-up at southern California’s Irwindale Speedway. This year’s schedule included competitions at Wall Speedway, N.J.; Road Atlanta, Ga.; Reliant Park, Texas; Infineon Raceway, Calif. and Chicago’s Soldier Field.

But drifting is more than just something to talk about at cocktail parties. This sport can offer a tire dealer an immediate opportunity to sell more tires, wheels and services.

How? For starters, key to drifting success is ground-gripping tires, tuned suspensions and brake upgrades. Knowing this, tiremakers and other automotive suppliers regularly use drifting events to promote their wares to thousands of young spectators. In fact, Formula D involves more tire manufacturers than any other motorsport series in the world, according to Formula D organizers.

Consider round five of the Formula Drift Championship. On Aug. 6, more than 6,000 spectators crowded into the parking lot at Chicago’s Soldier Field to see, hear and smell the action. How’s that for a captive audience?

Aware of the enormous branding opportunities the sport offers, tire companies are hot on drifting. Sponsoring this year’s Formula D Championship were: Falken Tire Corp., Yokohama Tire Corp., Toyo Tire (USA) Corp., Cooper Tire & Rubber Co., Goodyear Tire & Rubber Co. (via the Dunlop brand) and Kumho Tire USA Inc.

Not only do tire suppliers sponsor Formula D, they also have their own driving teams, which compete for points and bragging rights. Points are given to tire manufacturers for driver wins, and bragging rights allow tiremakers to use the ‘Tire Battle’ title in their advertising and marketing campaigns.

By involving themselves in this new motorsport, tiremakers are directing their marketing efforts at perhaps the most lucrative tire buyers – young males who love to spend money on their rides. There’s no reason tire dealers can’t do the same.

So, the next time you’re looking for a new way to boost sales, consider visiting – or even participating in – a drifting event.