State of the Commercial Truck Tire Industry in 2022
This article was originally published HERE
“Maximizing uptime and tire costs continue to be top of mind across all types of fleets. For that reason, we are seeing enhanced importance in servicing partners with robust tire and service programs and advanced data and tire monitoring software,” said Timothy Netzel, director of TBR brand marketing for Bridgestone Americas.
Abundant environmental regulations are making a big impact on fleet management, and tires are not left out.
“Given the environmental impact focus and regulations attempting to support it, one of the top trends in all three truck size categories are the efforts by tire manufacturers to increase fuel efficiency without giving up mileage,” said Tommy Bazzell, director of national account, truck stop & trailer OEM sales for Yokohama Tire.
Looking into Tires by Truck Size
Tire manufacturers are also aware of the industry’s continued focus on reducing greenhouse gases (GHG).
“When it comes to tire design, Bridgestone is focused on optimizing every tire element to deliver expected performance characteristics while still meeting the EPA requirements. Customers do not want to compromise. With the EPA’s standards in mind, we are developing tires with new tread patterns, compounds, and even casing construction to try and reduce or eliminate the trade-offs,” Netzel shared.
Light-Duty Truck Tires:
The light-duty truck market includes those vehicles weighing 10,000-lbs. GVWR and lighter.
“The light-duty market continues to move in an upward trajectory. Expanding e-commerce, construction, and the wide adoption of light-duty vans signal a return to the need for commercial-grade tires for these fleets. Recreational-based tires may not meet the needs of challenging commercial applications, where stop-and-go driving, vocational applications, and overall durability are key requirements,” said Dave Johnston, senior manager, commercial business and product development at Toyo Tires.
Continental Tire noted that, over the past decade, the volume of truck tires for the regional application continued to increase year in and year out, nearing long haul volumes.
“This increase has not been seen in the U.S. market in recent memory. As soon as the next five to 10 years, regional tire shipments are expected to eclipse long haul volumes. Many other sources support this trend, with less-than-truckload (LTL) reportedly growing at CAGRs of 10%-plus and last-mile delivery continuing to grow in popularity,” said Tom Fanning, vice president of sales and marketing for truck tires in North America at Continental Tire
Additionally, last-mile delivery is starting to move into more areas of commerce, including the light-duty market.
“Fleets are working hard to understand how to manage this new segment that is constantly evolving. As electric vehicles start integrating into this segment quicker than the heavier commercial vehicles, fleets are working to understand the adjustments needed in their operations and sites,” said Coy Jones, III, operational marketing manager, Michelin North America, Inc.
Medium-Duty Truck Tires:
Medium-duty trucks include those units between 10,001-lbs. GVWR and 26,000-lbs. GVWR. These are the big brothers to the light-duty pickup market but small enough not to require a commercial driver’s license (CDL) to operate. This size makes these trucks more appealing to last-mile delivery and service fleets.
“Medium-duty vehicles are looking for durability, traction, and stability improvements. This requires utilizing new technology in casing design, compounding, and developing tires within the North American market,” said Johnston of Toyo Tires.
Additionally, an emphasis on last-mile delivery remains evident.
“On-demand, same-day delivery, and the increasing preference of shoppers to have goods delivered straight to their homes resulted in a growing number of traditional and non-traditional fleets supporting the final step in the consumer purchase journey. Some estimates suggest these smaller fleets make up about 75% of the market. This shift has impacted the commercial tire offering for these fleets, with vehicles getting smaller but requiring higher load capacities,” said Netzel of Bridgestone Americas.
Netzel added that this change had brought a need for smaller commercial tires in the 16- to 19.5-inch range.
The medium truck market is experiencing a similar trend as that of the light truck world.
“ More fleets are utilizing shorter hauls between warehouses to get the products to consumers faster. In addition, the professional tradesman segment continues to grow and to size up in vehicles from the light-duty pickup truck to larger, heavier pickups and into the medium-duty segment. This could lead to continued growth for several years as fleets work to upgrade their vehicles,” said Coy of Michelin North America, Inc.
Additionally, as the labor shortage still affects the transportation industry, Class 6 trucks have become more popular as CDLs are not required, increasing the pool of drivers. Having drivers with varying truck driving experience and having a tire management system is even more critical for fleet managers,” shared Fanning of Continental Tire.
Fanning noted that Continental is launching more comprehensive tire monitoring solutions to add to its current portfolio, starting with a new generation 2 sensor. The new sensor not only tracks tire pressure and temperature but also manages the assets of tread depth and mileage.
“Fleet owners can continue to track truck tires on the cab or trailer or as the truck enters the yard. With Continental’s predictive algorithm in the web portal, fleet managers get real-time alerts on their phone or laptop when a tire needs to be serviced immediately and can also schedule maintenance to avoid costly breakdowns, protecting the safety of their drivers, cargo, and others on the road,” Fanning said.
According to Hankook, while inflation and recession are looming in the economy, the medium truck market remains strong.
Heavy-Duty Truck Tires:
Heavy-duty trucks are those over 26,001-lbs. GVWR and typically include the larger Class 7 and all Class 8 trucks.
According to a spokesperson from Hankook Tire, “Demand for this segment has remained strong, thanks partly to the Infrastructure Investment and Jobs Act, which has positively impacted construction and helped to ensure that fleets remain busy.”
The tire experts agreed, and the overall sentiment is that demand in this segment is high and is expected to remain so for the foreseeable future.
“Class 8 truck tonnage and loadings forecasted to all-time highs in 2022, overall freight rates between spot/contract are at the highest point ever, and strong utilization at 93.3% and strong conditions carried over from the prior year,” said Fanning of Continental Tire.
Johnston of Toyo Tires noted that heavy-duty/over-the-road truck tires are evolving to meet the demands of today’s fleet.
“New casing design and nanocomposite polymers have created durability and stability coupled with lower rolling resistance tires that today’s mid to last mile fleets require. Keeping the trucks on the road longer and improving the fleet’s return on investment,” Johnston added.
Supply chain challenges have an interesting impact on the heavier-duty tire market.
“The supply chain challenges of the past few years created the need for good dialogue and partnership between Michelin, the dealer network, and fleets as we navigate these challenges together,” said Jones of Michelin North America, Inc.
Industry Trends & Impact on Tires
The work truck industry includes a wide variety of vocational applications. From last-mile delivery to electric vehicles and supply chain shortages, there is more driving change in truck tires than just production-related advancements.
■ Last-Mile Delivery
Spurred more strongly by the global pandemic that started in 2020, one vocational segment growing by leaps and bounds is last-mile delivery.
“We are seeing noticeable growth in the last-mile delivery segment. Bridgestone continues to study this market, and plans are underway to offer a Bridgestone-backed differentiated program for our partner dealers called Bridgestone Last Mile Tire System (LMTS). LMTS, through active tire monitoring, focuses on uptime and cost-efficiency targeting small and medium fleets,” said Netzel of Bridgestone Americas.
Toyo Tire noted that the significant increase in last-mile delivery vans had shown the gaps that exist in the market.
“Low-speed durability in heavy stop-and-go traffic on optimized routes has proven a challenge for many fleets, particularly on FWD ‘skateboard platform’ vehicles. The pressure to meet deadlines and stay on route requires a commercial grade tire vs. a standard tire fitment,” said Johnston of Toyo Tires.
Fanning of Continental has also seen the growth in last-mile delivery and regionalized business rise throughout the past decade.
“We see no signs of the growth in last-mile slowing down, especially as companies meet the demand of their customers for free, fast delivery,” Fanning shared. “Last-mile delivery can also be very time-sensitive. Fleets who want to increase uptime and help prevent breakdowns should consider a digital tire monitoring solution.”
Our on-demand society is changing how fleets operate, creating shorter routes with higher volumes of deliveries.
“This challenge has amplified the need for a robust, scrub-resistant tire with the traction capabilities to maneuver in inclement weather and ensure timely delivery. These conditions are also favorable to retreading to ensure the fleet is getting the most from their tire life cycle to maximize return on investment (ROI),” said Jones of Michelin North America, Inc.
Every tire expert we spoke with agreed that the last-mile segment is a fast-growing segment expected to continue to thrive.
“Tires in this category range from consumer sizes through commercial sizes. There is no retread market for these tires, so they are only single-life tires. Like all segments, we’ll see a push toward longer-lasting, more fuel-efficient tires in the future. Yokohama will be launching the BluEarth RY61 later this year with a specific focus on these performance attributes,” said Bazzell of Yokohama Tire.
And it’s anticipated that the strength in this segment will continue.
“More last-mile delivery vehicles are entering the market. However, tires are often neglected, causing replacement to occur more frequently,” according to a spokesperson from Hankook.
■ Electric Vehicles
Just like you can’t go a day without hearing about last-mile delivery trends, electric vehicles (EVs) and their growing use in work truck fleets cannot be ignored.
“The commercial electric vehicle market continues to emerge albeit slower than some projected. We are seeing early adopters governing their fleets leverage the capacity/range equation minimizing wear and tear and maximizing their investment. Tires remain key to the uptime of any fleet. Ensuring tires fitted to EVs match the vehicle manufacturer’s requirements remains a priority,” said Johnston of Toyo Tires.
One of the biggest challenges with EVs? Weight.
“The greatest challenge with EVs is balancing the weight and torque requirements while reducing rolling resistance — a challenge we have decades of experience overcoming at Michelin. We’re further refining and enhancing the torque handling capabilities and in-cab road noises unique to electric vehicles,” said Jones of Michelin North America, Inc.
According to Fanning of Continental, improving rolling resistance is essential to get the best range for an electric vehicle, that is, the largest possible distance traveled before recharging.
“Tires play an important role in the vehicle’s overall rolling resistance (RR). Low RR is achieved by a blend of tread compound, tread pattern, and the construction of the tire — and the sidewall. All of these measures must be carefully coordinated to ensure that these tires retain their very safe handling properties and tire mileage. Wet handling, rolling resistance, and mileage are direct target conflicts in tire development, but Continental can optimize tire design to balance the needed characteristics,” Fanning noted.
Additionally, Yokohama noted that, given the nature of EVs, tires would need to evolve through continuous improvement toward fuel efficiency, longer-lasting original tread life, and casing integrity for retreading.
“Other areas of interest related to EVs will be load range, noise reduction, and torque factors, depending upon equipment advancements from an OE. Infrastructure will be key for the growth of electric trucks in the transportation industry,” said Bazzell of Yokohama Tire.
But not everyone sees the current level of growth impacting fleets that strongly currently.
“This segment, while growing, is still having a minimal impact on the overall market. As vehicle makers expand their EV offers, this segment should grow over time,” according to a spokesperson from Hankook.
■ Supply Chain Shortages
When looking at current supply chain shortages, tire experts have mixed responses regarding this challenge’s impact on tire production.
“Supply chain challenges have not impacted trends in tire design and development, but the industry, like nearly all others, has been impacted quite dramatically. Rising costs, fuel prices, inflationary pressures, and equipment shortages have all taken a toll on trucking. Like the overall economic impact on small businesses, smaller fleets seem to have been disproportionately affected by these challenges,” said Bazzell of Yokohama Tire.
Others have seen a supply-chain-related impact.
“The supply chain impacts all elements from the raw materials to the movement of semi-finished product, all the way to the final delivery to the end user. We work closely with our suppliers and customers to alleviate this challenge as much as possible and meet customers’ needs,” said Jones of Michelin North America, Inc.
Fanning of Continental recommended fleet managers look back to 2020 when tire manufacturers committed $7 billion to new plants and expansions, with 75% of those projects slated in Asia.
“This has been a continuing trend in the industry and why imports will continue to increase unless governmental action is taken. On the truck tire side, only a few manufacturers in recent years have made or announced significant plant investments in the U.S. (Continental’s newest Truck Tire plant located in Clinton, Mississippi),” said Fanning of Continental Tire.
But things are improving, if not immediately.
“Inventory levels have greatly improved as of late. The demand for medium trucks remained strong, even with some inventory shortages. Overall, availability of shipping vessels improved, and port congestion has also reduced considerably,” according to a spokesperson from Hankook.
But, there are still challenges.
“Toyo Tires expects the balancing of supply and demand in the commercial tire market to push into 2023. Demand continues to be strong and is forecasted to remain at these levels. High costs of freight and logistical demands are also expected to continue in the near term as we move toward the holiday stocking season and the surge of imports at the ports. We are seeing improvements but not at the levels needed,” said Johnston of Toyo Tires.
One other factor impacting truck tire availability and manufacturing is continually changing regulations.
“Regulations will continue to be a key factor impacting the reduction of greenhouse gas emissions, as well as tires that are Smartway approved for increased fuel efficiency,” according to a spokesperson from Hankook.
And while some things continue to change, the more others stay the same.
“Regulations are omnipresent in our industry and are here to stay. Regarding the regulatory impact on tires, we expect a continued push towards improved fuel efficiency,” said Bazzell of Yokohama Tire.
The Bottom Line
Fleet managers need to remember that, in today’s competitive environment, maximizing uptime is critical.
“Keeping trucks running helps fleets stay ahead of the competition, maintain a good reputation, and consistently deliver on time. Finding quality, cost-effective, and available service providers can be cumbersome, particularly for small fleets without a large network,” concluded Jones of Michelin North America, Inc.