By Nobuzwe Mangcu, Managing Executive – SATMC
Manufacturing has inevitably become a highly competitive arena where manufacturers have emphasised their competitiveness on the pillars of safety standard requirements and innovation.
This emphasises particularly in the context of safety critical components such as tyres has become the impetus in how manufacturers are getting one over their competitors and solidifying their position to be at the apex of original equipment manufacturing.
However, what is the stimulus behind this drive or more judiciously what should manufacturers keep in mind when they battle for supremacy when it comes to manufacturing stakes – bottom line profits or consumer safety?
That has always been the fine line that manufacturers have had to contend with in the pursuit for dominance where reputation is everything. These two pillars are always intertwining with one another where manufacturers continually invest heavily in their research and development to galvanise their innovation output and to ensure their products are always at the cutting-edge of providing consumers with the safety value required – and consumers in turn are willing to pay top dollar for that reassurance.
This also resulted in original equipment manufacturers (OEMs) modelling their marketing and sales structures so that they sell directly to their customers further reiterating the ambitions of OEMs.
Over and above this, the integrity of OEMs has always been in the quality they provide stemming from the fact that these tyres have been created and tested according to the manufacturers’ specifications and high-standards and therefore, guaranteed to be of a high-quality. Integral to the benefits of the OEM tyres is the warranty aspect.
A manufacturer’s OEM warranty is different, and should you as a consumer purchase or receive a tyre with defects then the manufacturer is obliged to quickly replace the part.
Customers enjoy the added benefit of return-on-investment due to the fact that since an OEM tyre is designed to fit and perform to factory specifications, and thus it increases the life of your equipment. This will save you money and reduce breakages or faults resulting in substandard or inferior products.
As things stand, the forecast when it comes to the future of the global tyre industry is projected to reach 2.5 billion units by the year 2022, this according to Global Industry Analysts. I must emphasise that this projection is solely based on tyres that will be produced and manufactured by OEMs. This means that this figure can be nearly tripled if you factor in the influx of cheaper alternatives.
The Global Industry Analysts further accentuate that the focus will be on the development of tyres which will mitigate the issue pertaining to fuel efficiency and the demand low resisting tyres and the rise in stringent environmental regulations.
This has culminated in the focus among tyre OEMs to focus on tyre performance and efficiency as the blue print in developing new tyres – something that will require the incorporation of innovative tread designs.
The biggest challenge for OEMs parts or the usage thereof, will always be the emergence of inferior alternatives that embody the tough economic global trends that spur people to spend less and overlook the benefits of using OEM when it comes to fitting new tyres. The volatile situation employs OEMs to become ever more resourceful and creative in how they remain competitive and more importantly in how they make customer see the value in their products.
However, the perpetual rising trend of urbanisation resulting in rising populations in urbanised areas, lifestyle changes and the increase in disposable incomes has led to an increase in the purchasing capacity of consumers worldwide, meaning that consumers are economically equipped to back better informed purchases.
This trajectory means that OEM parts such as tyres can rely on the ever rising demand of automobiles which are propelling the growth of originally manufactured tyres.
There needs to be a consciousness that even though the OEM market can be practically divided into two tiers – the OEM (in this case this would be tyres come fitted standard on a brand new vehicles) as well as the replacement market, and ideal scenario would see the OEM market filter to replacement market which is dominated by cheaper alternatives.
In other terms, customers must strive to replace their original tyres with the same brand and manufactured tyres that their vehicles originally came fitted with.
The singular approach to safety standards and regulation requirement manufacturing OEMs is probably the biggest asset that this market has over the replacement market as well as over cheaper alternatives, and this philosophy must be the guiding- force in helping our consumers make the informed decisions when buying safety critical components such as tyres.