January 2015 gasoline and diesel prices were nearly a dollar lower than they were in late 2014, with prices hovering around $2 for regular grade gas and $2.90 for diesel fuel. Lower fuel prices and a stronger economy are positive indicators for the automotive market, and the light truck tire segment is no exception.

In 2014, light truck tire sales were slightly up, according to tiremakers. The group is optimistic this trend will continue in 2015, barring any large shifts in fuel prices, economy or new government regulation.

“Off-road light truck tire sales are closely related to the state of the economy as a whole,” notes Drew Dayton, product manager for Toyo Tire USA Corp. “People use trucks for work, commonly construction, and many others use them for fun, like off-roading. Both the construction industry and disposable incomes are tied to the health of the economy. When times are good, both flourish. When times get tough, both suffer.”

“The economy and fuel prices have historically been strong influencers on sales trends in the light truck segment. We expect that they will continue to influence this segment the most in the foreseeable future,” agrees Scott Jamieson, director of product management for Cooper Tire & Rubber Co.

While the sales of new light trucks hit a low point during the recession, they have been growing since, accelerating as more fuel-efficient models were introduced and certainly now that gas prices have dropped. According to the Auto Care Association’s most recent numbers, light truck sales totaled 7.8 million in the U.S. in 2013, a 10.3% growth over 2012. Sales in 2014 are expected to roll in at around 8.5 million units, some analysts say.

“From a new vehicle standpoint, the pickup market reached a low point during the recession but has rebounded slightly and leveled off with the rebound of the construction market and the stable fuel prices,” says Alex Templeton, senior business intelligence manager for Michelin North America.

In the past few years, there has been a divergence in the category between traditional body-on-frame SUVs and pickup trucks and the car chassis-based or crossovers (CUV), notes Templeton. This divergence can offer an opportunity for light truck tire sales.

“The vehicle owner that still owns or purchases a body-on-frame SUV or pickup has likely made this choice either from a usage-derived need or as a form of personal expression,” he says. “This customer may be more open to an aggressive off-road type tire or a tire that is uniquely tailored to the vehicles’ intended usage. For example, longer mileage tires are suitable in a high-torque/heavy-load application.”

Serving the Customer

When it comes to light truck tire customers, tiremakers divide the end-users into subcategories. While tiremakers may use different names for those subcategories, they do agree on the varying characteristics of light truck tire customers.

Michelin divides light truck tire users into two groups: those wanting tires for work and those wanting tires for play (enthusiasts).

In a work environment, construction and service industry applications call for a tire that will defend against failures that the daily workload poses in specific environments, especially in harsh environments such as gas and oil fields, Templeton notes. Because of this, many companies are increasing sizes within load range E, he says.

Enthusiasts can be broken into two further categories, Michelin’s Templeton says. One group includes those drivers that engage in activities where they might be taken “off the beaten path,” so to speak, to places where traction and durability are major concerns. The other group is comprised of drivers that are early adopters when it comes to vehicle customization trends. This subcategory of enthusiasts are interested in the overall aesthetic of the vehicle.

Even though the groups differ, they share a similar appreciation for the vehicle itself and the experience of driving, Templeton says.
Similarly, Toyo also divides light truck tire users into commercial and enthusiast users. Cooper divides the light truck tire end-user market into those looking for function and those who want the aesthetic.

“Function typically covers the largest consumer type, ranging from contractors and weekend warriors to general consumers who expect their tires to perform a particular way. For aesthetics, the consumer’s main reason to purchase is to give their vehicle a particular look. Performance is expected, but it is typically secondary to the look of the tire,” explains Jamieson.

In order to help customers select the right light truck tire, tiremakers agree that it’s critical to understand the customer’s needs and expectations.

Asking questions about why the customer is replacing their old tires, how they use their truck, what their expectations are for mileage and tread life, and more can help dealers select the right tire. Dealers should listen not only to the customer’s answers, but their implied needs, as well.
“Each segment of the light truck tire market has benefits – from highway terrain tires with a quiet ride and long tread life, to mud or maximum traction tires with off-road traction and durability qualities and aggressive looks – so the key is to match those benefits with the wants and needs of the customer,” says Toyo’s Dayton. “Whether they desire on-road comfort, longer tread life, off-road traction or aggressive looks, there is a tire for that customer – it’s just a matter of finding it.”

For enthusiast customers, credibility and technical knowledge is important. “These highly involved consumers want to talk with a dealer that is knowledgeable about the application of the tires and vehicle trends,” Michelin’s Templeton shares.

New Technology

Since performance is key to many light truck-tire users, technology can be a driving factor for a tire’s success.

When developing light truck tires, manufacturers focus on tread compound optimization for specific needs of the tires, such as cut-and-chip resistance, tire wear, and traction, Toyo’s Dayton notes. Tiremakers also focus on tread features that can perform specific tasks, such as mud and stone ejectors, interlocking tread blocks and side biting edges, he says.

Michelin’s Templeton notes that many companies are now touting “severe” or “professional” grade products with chip-resistant compounds, three steel belts and multiple sidewall piles, as well.

Additionally, one new light truck tire trend is for tiremakers to launch tires that blur the line between all-terrain and all-weather tire, Templeton says. Both Michelin and Cooper have launched tires that reflect this trend: the BFGoodrich KO2 and Cooper’s Discoverer A/TW.
In the future, technology in the marketplace will continue to change as auto manufacturers increase light truck capabilities.

“One of the dynamics has been that tire manufacturers are trying to keep up with the increases in torque and horsepower that we are seeing both in diesel- and gas-powered pickups. These new engines make the job that tires do increasingly more difficult,” Templeton says. “Due to this, we will likely see some crossover technology in terms of tire construction and tread compounds find its way from commercial truck tires into the light truck offerings.”