With nearly 16 million two-wheelers being sold annually, there is an immediate demand for at least 32 million new tyres. Most tyre manufacturers view the OE relationship as a gateway to increased replacement demand and have developed a network of dealers to increase penetration in the aftermarket. However, to succeed in this market, they need to understand what drives satisfaction with tyres among two-wheeler owners.
Our study findings report that, on average, a two-wheeler owner checks air pressure every 10 days, signifying frequent hands-on interaction with tyres. They expect that the tyres should last about 26,000 km, or around three years, considering an average two-wheeler is driven 9,500 km a year.
As two-wheeler owners typically keep the vehicle for seven years, they have to undergo tyre replacement three times, making it one of the most frequently replaced major part. This is a huge opportunity for tyre manufacturers.
JD Power studies find that the key problems owners face are frequent punctures, poor road grip, uneven tread wear and cracks/bulges on the sidewall. Of greatest significance: owners report 1.32 problems per 100 vehicles on frequent punctures. If we multiply this by the number of two-wheelers sold in a year (16 million), you are getting more than 210,000 new two-wheeler owners being inconvenienced.
If we consider India’s high road accident rates and poor road conditions, this becomes a matter of riders’ mortality as well. Any improvements on these problems would be significantly felt and contribute to higher satisfaction levels.
Cost of repairs
Nearly half of all two-wheeler owners report having to spend a median amount of Rs 500 on tyre repair and replacement in initial 24 months. A tenth of the owners report replacing one or more tyres within 24 months, with chief reasons being damage from road hazards, puncture or blowout and tyre wear.
The other half who did not have to spend anything had significantly higher satisfaction levels with the durability of their OE tyres than those who had to pay (761 versus 763 points on a 1,000-index scale). Considering that demand in the replacement tyre market is driven by customer perceptions of OE tyres, customers who are satisfied with their OE tyres are more likely to repurchase the same brand. Tyre manufacturers can look at avenues to reduce tyre maintenance expenses and improve customer retention rates in the aftermarket.
Satisfaction by segment
Scooter owners are most dissatisfied with traction/grip of their tyres, while motorcycle owners are not content with the durability. Does this knowledge matter? Yes, it does. The reason why motorcycles report lowest satisfaction with durability is because they clock 18% more in terms of distance driven.
All this points to the demand from customers to have products that are specifically built according to their needs. And the payoff? Higher loyalty to the brand when the time comes to replace OE provided tyres.
The authors, Kaustav Roy is director, Rajat Aggarwal is research specialist, JD Power