Industry overview with Yokohama Tire’s Hamaya
The requirements in Europe are different because they drive very fast, especially in Germany. There, they may not care as much about how long a tire would last as they would about the tire’s performance at higher speeds. Overall, in terms of tire performance and technical requirements, producing the right tire for the U.S. market is more difficult than anywhere else.
Question: How does the consumer market look?
Hamaya: It’s a little weak right now. The competitive space is much more crowded and the diversity of the product and price range add to the volatility. This is yet another reason why getting the right product mix is so critical for long-term success.
At the beginning of 2012, the industry – including Yokohama – did well regarding supply and demand, and all were profitable. However, in the second half of the year, demand slowed down. That translated to lower prices and more price-war competition. Everybody’s business suffered. Companies were forced to spend more money to gain market share and that cut into profits.
Question: Has that been the case in 2013 so far? Will the tire market improve?
Hamaya: The overall market expects only slight improvements but at Yokohama, we have a very strong customer confidence so I’m highly positive on my outlook on our consumer, as well as our commercial and OTR, divisions. We’re rolling out aggressive growth and supply plans that will strengthen our position in the market in 2013 and beyond.
Question: What are your thoughts on Yokohama’s commercial and off-the-road or OTR divisions?
Hamaya: We are doing well in both. Both have well-trained people who are also well-ingrained in their respective industries. This shows in the close relationships we have with our dealers and in the customer satisfaction we achieve.
In our OTR division, we have not been able to supply to the level of market demand but our customers work with us because they know that what they get is a quality product. Yokohama tires perform as promised. We are putting this same commitment as we ramp up our efforts in giant OTR radial tires.