Lee said that due to a combination of increased availability of product from capacity expansions in the tiremaker’s Indonesia and Hungary facilities, as well as the end of U.S. tariffs on Chinese-produced consumer tires, it is “very reasonable” to see Hankook’s North American business unit reach sales of $1.4 billion in 2013. Over the last seven years, the company has averaged 13% annual sales growth in North America.
Denlein, running the dealer meeting for the first time, said in order to accomplish that goal, Hankook’s strategies are about “sustainable” growth for the company and its dealer partners. He emphasized Hankook’s product line, the quality of the tires and how well the brand has performed in several Consumer Reports tests.
A number of dealers told Tire Review they were interested in house brands Kingstar and Aurora, as Denlein indicated those brands have received added offerings to give dealers a good-better-best lineup to offer customers.
New Tire Plant
Also taking the stage at the meeting was Hyun Bum Cho, president and chief marketing officer of Hankook Tire Co., who noted Hankook’s success plan “is based on achieving an economy of scale for long-term success,” which “is crucial to continued growth and overall profits.”
The appearance of Cho, who is a major shareholder in the parent company and is reported to be one of the 200 wealthiest people in South Korea, was a refreshing experience, according to a number of dealers in attendance, who said meeting and talking with him allowed them to have a better understanding of the company as a global player.
In order to reach the top five global tire manufacturer ranks, Hankook must overcome both Sumitomo Rubber Industries and Pirelli SpA. To do this, Cho said a North America tire plant is a necessary addition to the company’s overall strategy. He stated the chance of a U.S. plant being built “is over 80%; we want to grow evenly around the world and are looking for balance.”
In North America, Cho estimates the company can improve its overall marketshare to 12%, even to 15%, in the long term, especially once a local plant is in place.
Other highlights of the meeting included the announcement of future changes to Hankook’s “One” dealer marketing program, launched in 2012. The tiremaker also plans to continue to pursue OE fitments in both the consumer and commercial markets.
Lee did share some concerns that Hankook expects 2013 will bring challenges, indicating that market expectations might be softer than desired. But Denlein said Hankook will outpace the rest of the industry, even in soft economic conditions, with a wide product screen that offers new and updated quality products.
New Rollouts
On the consumer tire side, Hankook introduced new products in the winter and summer UHP segments, and discussed plans to further build its brand image with sponsorships, advertising aimed at consumers and dealers, and an expansion of its social media efforts.
New consumer products for 2013 include:
The Ventus S1 Noble 2 UHP All-Season, which was introduced at the 2012 SEMA Show/Global Tire Expo.
The tire went on sale March 1 in 40 sizes covering 16- to 20-inch wheel diameters.
The Winter I*cept iZ, available in 24 sizes ranging over 14- to 18-inch wheel diameters.
Winter I*pike RS, a studdable winter tire available in 37 sizes covering 13- to 18-inch wheel diameters. The tire features a 16-row stud arrangement.
Commercial Tires
Brian Sheehey, director of commercial tire sales and marketing, announced plans to increase his sales force in order to help dealers develop stronger sales strategies to move product into local and regional fleets. He said the additions also would help dealers target specific accounts that are using competitive products. In this way, Sheehey said, Hankook can help dealers organize “better sales efforts” in defined territories. 
He also noted Hankook’s medium truck tires sold in North America are either Smartway-verified or designed to be verified by Smartway in the future.
Another component of Sheehey’s business plan is to gather more cost-per-mile data, which he said is key information for fleets, and “allows the company to better understand new product development for our fleet customers.”
New medium truck tires coming in the second half of 2013 include:
• AH15 wide-based rib tire in 385mm and 425mm tread widths. The tire, which replaces the AH10, features anti-chip and cut compounding and enhanced endurance and mileage.
• DL07 and TL07 long-haul super wide drive and trailer tires, each coming in size 445/50R22.5.
• DL12 Multi-Way Series drive tire designed with traction aids and to handle higher operating weights. The tire will be available in sizes 295/75R22.5, 285/75R24.5, 11R22.5 and 11R24.5.
• AM15 wide-base all-position tire for on- and off-road capability, available in sizes 385/65R22.5, 425/65R22.5 and 445/65R22.5.
William Wong, vice president of World Wide Distribution in Irvington, N.J. – which has carried Hankook commercial tires for 13 of the 21 years it has been in operation – said his company’s business is made up of 80% commercial truck tires.
“The Hankook brand is becoming widely accepted and does extremely well for our company,” he said. “As Brian Sheehey mentioned, there is a value in focusing on regional fleets, and we have been doing just that for many years in our trading area.”
