Aeolus Tyre Co. Ltd., based in Jiaozuo, Henan Province, is working hard to separate itself from what its leadership describes as the typical Chinese tiremaker stereotype. Ranked the fifth largest tire manufacturer in China in terms of sales – and the country’s top tiremaker in 2010 in terms of growth – Aeolus is a true global enterprise, exporting product to over 100 countries.

But being a large manufacturer and successful exporter is not enough for the company; the next step is to become a powerful manufacturer, according to Aeolus General Manager Wang Feng. In fact, he said the tiremaker’s goal is to ultimately become a global Tier 1 manufacturer.

To separate itself from the rest and accelerate its global growth, Aeolus recently made several major announcements at its Greentyre Global Launch Event, held July 9 in the company’s home city. Aeolus said it has officially become the first Chinese tiremaker to begin 100% environmentally friendly production of tires. It also now offers medium truck/bus radial tires that boast long tread life, solid retreadability and low rolling resistance.

In addition, Aeolus has jumped into the passenger tire market – an entirely new product segment in the tiremaker’s 46-year history – with the completion of a second manufacturing plant.

While each milestone was important to the roughly 200 invited guests in attendance – dealers, distributors, partners and select media from several different countries – the improved medium truck/bus radial tires held particular meaning for Alliance Tire Americas, which is the sole distributor of Aeolus commercial truck tires in the U.S.

In order to fully appreciate the significance of Aeolus’ three-pronged investment, it is important to understand the company’s roots and its supplier relationship with Alliance.

New Business Model
Aeolus, founded in 1965, produces Aeolus and Henan brand truck/bus radials and off-highway tires. In total, the tiremaker offers 660 sizes and patterns.

Aeolus truck tires reached North American shores through a distribution agreement with the former GPX International Tire, which was ultimately forced into bankruptcy, partly as a result of the 2007 U.S. Department of Commerce Antidumping/Countervailing Duty findings. In December 2009, Alliance bought portions of the bankrupt GPX International Tire, taking over distribution of Aeolus in the U.S. as part of the deal.

With the purchase, Alliance Tire Americas became a truck tire distributor, even though the segment had not been a core business of parent company Alliance Tire Group. “Only in the U.S. do we have this business unit,” explained Manny Cicero, president of Alliance Tire Americas. “We don’t distribute truck tires anywhere else in the world.”

To prove that it was fully invested in the new business opportunity, Alliance Tire Americas hired John Hull as its national truck tire sales manager. In this role, Hull oversees Aeolus truck tire sales – which have increased some 60% since 2009, according to Cicero.

The first step Hull took was to cut cross-sections of an Aeolus tire and those of competitors to perform a side-by-side comparison (click here to see a video of Hull’s comparison).

“When you look at the inside of the cross section – the uniformity of the bead, the belt edge spacing, etc. – an obvious Tier 3 or 4 player will have poor construction,” Cicero explained. “Aeolus looked much more like a Bridgestone than it did some other Chinese tires.

“If you lump Aeolus in with Chinese tires in general, then the only thing you can sell it on is low price,” he continued. “So Alliance has positioned Aeolus as a price-value proposition. While not the lowest price, the tires deliver performance that more than compensates for the cost over the so-called ‘price only’ brands.”

As revealed at the Greentyre Global Launch Event, Aeolus has taken several steps to further improve the quality of its products and its place among tiremakers worldwide.

Green Production
Aeolus said its “100% environmentally friendly” manufacturing process – adopted at both its commercial and passenger tire plants – ensures that all tires it produces from here on out are REACH-compliant, meaning they do not contain extender oils with high levels of dangerous polycyclic aromatic hydrocarbons (high-PAHs).

The tiremaker said its new generation fuel-saving tires are made with processes that create lower levels of smoke, dust, noise and power consumption. This is achieved through low-temperature mixing, nitrogen curing, the use of pelletized carbon black and chemicals, the installation of a high efficiency dust arrester in the plant, and zero emission wastewater recycling at the facilities, according to the company.

Aeolus also upgraded the zinc oxide used in its tires to decrease the amount of heavy metal – especially lead – present in each product. Rather than 0.14% of normal zinc, the company now uses 0.04% of upgraded zinc, according to Aeolus.

“There are no specific tire environmental protection laws or regulations in China,” Feng told event attendees. “Most domestic tire manufacturers have not promoted green tires in the Chinese market until now. Aeolus has chosen to bear the cost to produce green tires because of our values and our initiative to undertake social responsibility.”

AGT Radial Tires
Not only are the new medium truck/bus radial tires – Aeolus Green Tires, or AGT – produced in a more eco-conscious facility, they offer end-users the opportunity to save some “green” when it comes to reducing lifecycle costs.

The AGT products, which started with initial availability in size 385/65R22.5 and will eventually replace all Aeolus’ medium truck/bus radials, boast long tread life, high retreadability and low rolling resistance, according to the company.

And Aeolus’ claims are quite noteworthy, to be sure. During the company’s testing, an AGT HN369 tire in size 315/80R22.5 resulted in a 24% drop in rolling resistance compared to the same size in a standard Aeolus tire. In fuel efficiency testing, the same AGT tire showed a 7% decrease in fuel consumption compared to a standard Aeolus tire, according to the tiremaker.

Aeolus said its goal is to “improve mileage by 30% against current products through a new wear-resistant compound, improved carbon black dispersion in the mixing process, and the optimized pressure distribution and footprint” of the AGT tires.

In addition, the AGT medium truck/­bus radial tires can now be retreaded twice due to a new design with a stronger casing, cooler-running tread and four-ply belt construction, Aeolus claimed. The cooler-running tread is a result of a new belt edge filler compound and a new low temperature-generation subtread compound.

To ensure product quality, Aeolus has installed high-precision molds for improved accuracy alignment during the curing process. Tires leaving the commercial plant – about 800,000 units annually – are subjected to a barrage of quality checks, including visual and X-ray inspection, uniformity and dynamic balance detection, tire holographic analysis, and high-speed endurance and physical testing, Aeolus said.

“Aeolus now has the highest quality truck/bus radial tires made in China,” Feng said. “The company’s goal is to have a price/quality position higher than that of (South Korea’s) Hankook Tire Co. Right now we are at about the 20th position in the ranking of world tire manufacturers; our intention is to be in the top 10 manufacturers in the world.”

The tiremaker’s claims impressed representatives from Alliance who attended the launch event. “If Aeolus’ rolling resistance claims are borne out, then this is very big news for fleets,” Cicero related. “The long-haul fleet segment is one that we don’t really sell to today; the primary customer for Aeolus has been regional fleets and short-haul fleets because of the price points and the volumes required for long-haul and national accounts.

“If we can truly deliver a 5% to 6% fuel savings that’s documentable, we can open up Aeolus to a whole new segment of the end-user market,” he continued. “I think in the U.S., people in general are starting to expect green initiatives. All things being equal, if you have a green alternative and it’s not much more expensive, people tend to choose that.”

Cicero noted that Alliance plans to look at detailed testing results, as well as do its own research, in order to formulate a strategy for marketing the new AGT radials in the U.S.

“We’re impressed with the product quality and we know Aeolus has the ability to reach a higher tier, but it’s going to take some dedication,” he added. “And that’s why we came here – to demonstrate that we’re committed to helping them grow.”

Reaching New Markets
The third announcement at the launch event concerned the $150 million Aeolus invested in building its brand-new passenger car radial tire plant. Adjacent to the tiremaker’s state-of-the-art commercial tire plant, the new facility is equally as modern and well-equipped.

Though only in the trial production stage at the time of the event, the company will produce HP, UHP, winter and eco-friendly passenger tires, as well as light truck/SUV products. The plant’s ramping-up will occur in stages, with annual capacities of 5 million and 8 million tires for stages one and two, respectively, and a yearly output of 13 million tires once it reaches full production by the end of 2013, according to Aeolus.

The tiremaker planned to put the first 10 sizes into full production by the end of last month.

Well-Rounded
Considering Aeolus’ lofty goals, it was important the company created a stir with its international event. Feng said that while the tiremaker’s ultimate objective is to attain Tier 1 status by 2030, its first step will be to reach Tier 2 status by the end of 2015.

“(Domestically), perhaps we will have the opportunity to merge with other factories or grow by purchasing more factories,” he explained. “For our global vision, we are focusing on overseas markets and forming strategic plans for the global market that also have possibilities.”

Feng concluded by saying, “To be a responsible tire manufacturer is important to us. Since 1965 when we were founded, we’ve experienced ups and downs but have always shown innovative progress, harmony between man and nature, and the implementation of our social responsibilities. I believe in the near future the tire industry in China will gradually switch to green manufacturing. We look forward to playing this leading and exemplary role.”

For more exclusive photos from the event, click here.