Execs speak about growing the tyre brand amid tough competition
With the sheer number of vehicles on the UAE’s roads, it’s easy to see the country is an important market for tyre manufacturers. But with so many established brands vying for customers’ attention, it can be difficult for a tyre-maker that hasn’t been around that long in the market to find a foothold.
German tyre manufacturer Continental plans to strengthen its presence in the Emirates with the opening of a new showroom and service centre in Al Quoz, Dubai in May. The facility was inaugurated in conjunction with the brand’s UAE dealer, Emirates for Universal Tyres (EUT).
The new showroom – Continental’s third such facility in the UAE – will stock passenger, light truck, commercial vehicle and speciality tyres. It will also provide mobile services to allow fleet customers to receive regular visits from EUT representatives to monitor tyre pressures or refill nitrogen gas.
One highlight is the Bead Bazooka, an inflation product which minimises refilling times, resulting in more efficient service. Other showroom services include nitrogen gas tyre-filling, fitting facilities, balancing, alignment, rapid oil change, vehicle AC repairs, brake-disc skimming and minor mechanical repairs.
The new facility is an indication of Continental’s interest in the Middle East, says Herbert Mensching, managing director EMEA – marketing & sales for replacement truck tyres. “It’s an area where we all expect growing business, and from that point of view, it’s of high interest for our industry and for Continental. This is the key reason why such an opening is of importance for us.”
Although the brand has not been around in the UAE and Middle East for as long as some of its competitors, opening the facility is a way to more firmly establishing its presence in the market, says Dr Hartmut Wöhler, Continental vice president EMEA – passenger and light truck tyres, adding that long-term plans in the region entail closely studying the needs of customers and continuing to develop products especially designed for the local conditions, most notably heat and high loads.
One such product is the ContiCoach HA3 AC, a coach tyre designed with Active Cool technology especially for the Middle East. Other tyres that will be on sale in the new showroom include the ContiSportContact 5P and ContiPremiumContact 5, which are designed to perform on hot roads in the harsh summers typical of the region.
Apart from the harsh climate, overloading is also a fact of life on roads in the Middle East that tyre manufacturers need to account for, Mensching says. “Not everyone sticks 100% to the regulations, so that means the tyres have to stand a higher payload.”
Operating conditions are tough throughout the region but often differ slightly by country, says Andreas Bertram, managing director for Continental Middle East. “Here in the UAE, you are mainly concerned with the overload situation. In Saudi Arabia, you have long haulage and you have speed and heat.”
While these factors generally dictate how products are developed, the size of the market affects distribution strategy, Bertram adds. “In a huge market like Saudi Arabia, you have to use wholesale channels, otherwise you’re not able to cater to the whole region.”
But Continental’s approach is typically to sell the direct way, straight to end users, he notes. “Only by doing this can you ensure that the tyre is used in the proper way. You also have the possibility to control the sales and usage of your tyres, and offer the right service to the end consumer.”
Developments in the market
As manufacturers look to develop products in line with customer requirements, it’s interesting to examine how the market for tyres has evolved. Although there haven’t been many technological advances in tyres, the market is increasingly leaning towards tyres being customised for different industries and applications, Mensching says.
“In a certain way, a tyre is still a tyre. [But] what you can see now is that tyres are more dedicated to certain applications. Before, you had a tyre which was meant to fit everywhere, so regardless of what kind of business you were operating, in construction or goods transport or people transport, you quite often used the same tyre. This is something which is coming to an end.”
Even as tyres become more specialised, mileage and durability remain paramount for customers in the Middle East. Offering reliable and robust German-engineered products is how Continental hopes to ultimately differentiate itself from more established rivals, Bertram concludes.
“We have to admit we’re not the first one here in the market. We have competitors who have been here for 30-40 years. But if you have the right product, the right performance of the product, the right service, you can find your place.”