The biggest brands are selling fewer high-performance tires and some of the biggest names in sports car racing are abandoning the sport altogether, according to industry sources.
While the U.S. is still the world’s largest tire market, China is expected to overtake it by the end of next year and the global market is expected by the year 2020 to grow to $4 trillion, said David Schoenbaum, a research analyst at Jefferies Group Inc.
In 2018, global sales of premium tires and high-tech performance components like tires, airbags and anti-lock brakes jumped 9 percent to $2.7 trillion, according the Tire Industry Association, which represents manufacturers.
In 2019, sales of the two categories climbed 13 percent to nearly $2 trillion.
Industry experts say the biggest brands, including Mercedes-Benz, Cadillac and Porsche, are not going to make any serious effort to appeal to younger buyers and are going to focus on maintaining their market share, which has remained relatively flat in recent years.
“It’s a bit of a Catch-22.
You have two different groups of buyers,” said Mark Reuss, president of research at Jeffries Group.
“It’s not a case of, ‘Let’s buy a new car or a new tire.
That’s going to work.’
It’s a case where you have to figure out what your best strategy is.”
In fact, the two major categories are far apart in terms of what they sell.
Mercedes-AMG sales of luxury sports cars, including the M3 and S-Class, fell 6 percent to 1.9 million vehicles in 2019, while Audi and Porsche sales of sporty luxury cars fell 12 percent and 11 percent, respectively.
In terms of quality, premium tires are more expensive than ever, with prices rising faster than inflation, according a new study from the Tire Institute.
For example, the price of a Michelin Sport Cup 2 tire rose 14 percent in 2019 from $9,800 to $14,800.
The industry said premium tires also have an advantage in terms on comfort and fuel economy, with a brand-name tire costing a quarter of the price that a similar model on the same brand sells for on the market.
The cost of tires has dropped as well, as the cost of materials has risen in tandem with inflation, the industry said.
In 2020, materials for the same model of premium tire in China fell 18 percent, compared with 14 percent a year earlier, according of the study.
In addition, the study said some premium brands, like the Audi, Porsche and Mercedes-Amphibious brands, have switched to low-priced tires that are cheaper than their high-priced rivals.
The tire industry also said that the price declines of high performance tires are a result of consumers being able to afford the higher price.
The higher price of premium performance tires is “because consumers are more willing to spend the money, because they can’t afford to buy a brand new tire,” said Reuss.
“The reason premium performance is so popular is because the brand name is a lot more attractive.”
The biggest brands have moved away from premium performance to high-quality tires.
The biggest luxury car makers, including Porsche, Mercedes-Amerakas, Lexus and BMW, have abandoned the sport, while Jaguar Land Rover, Audi, BMW and Mercedes have all said they are moving away from high-speed, all-wheel drive vehicles.
In the auto industry, the loss of the high-technology performance and comfort is being driven by consumers buying luxury vehicles in the U.
“High-performance” tires are lighter and more durable than standard tires.
High-end” tires, which are also designed to withstand a crash, cost more.
High performance tires, like Michelin’s Sport Cup, are designed for more-powerful cars and offer better handling.
Low-quality, lightweight tires are often heavier and more expensive.
They’re also less durable and have lower-tech features that reduce their fuel economy and durability.”
The tire market is a great place to do it.””
There’s a demand for a more affordable brand that offers that premium quality.
The tire market is a great place to do it.”
The market is also shifting toward a low-tech approach, with some brands adopting technology to reduce wear on their tires.
That trend has been a boon for luxury brands, which have long been criticized for using their premium products to get in front of the market and appeal to the young.
“They’re really taking advantage of the opportunity to get into a younger segment and the millennials,” said Lamm.
The trend could continue as more and more high-price brands abandon the sport.
For instance, Michelin, which makes the M1 race car tires used by Formula 1