Will Labels Change The Market Share Distribution?
There has been much discussion lately about whether the lay of the land in the tyre industry will be changed dramatically, or indeed at all, by the introduction of the new EU tyre labelling laws. Analysts at Deutsche Bank Equity Research have already given their opinion that it won’t change very much at all.
The analysts at DB Equity Research do feel that the introduction of the tyre label is a step in the right direction for the tyre industry, but that it will not lead to any real changes in the market share of the tyre manufacturers themselves.
They feel that the premium tyre manufacturers who design and develop more than one brands will benefit most from the new laws, but anticipate that every tyre manufacturer that has a range of at least 500 tyres will manage to produce at least a few AA rated tyres (scoring A for both rolling resistance and wet braking), which will then be heavily marketed. The tyre companies would hope this would give enough of a boost to their brand that motorists will look on their whole range more favourably.