SEMA News - November 2009

By Megan McKernan

Custom Wheels and Performance Tires

 

The specialty-equipment market is divided into nine niches. For each of these, there are three segments, one of which is the wheel, tire and suspension category. Overall, the wheel, tire and suspension category rose nearly 2% in retail sales and 3% in manufacturer sales from 2007 to 2008 (See Chart 1). Light truck is the niche in which wheels, tires and suspension represent the largest percentage at $1.29 billion in manufacturer sales (See Table 1).

For the average consumer, wheels and tires are a matter of function. But for an automotive enthusiast, wheels and tires are also about looks and performance. This is evidenced by the popularity of specialty-equipment products, such as low-profile tires and big rims. Custom wheels are often purchased for the addition they make to the overall look of a vehicle. But that is not always the case. A pickup owner who tows a boat or a race-car trailer is also concerned with the strength of the wheel. He or she will likely pick a forged-aluminum wheel rather than a cast-aluminum or multipiece wheel. Of course, this does not mean that design is ignored. There are awesome-looking forged-aluminum wheels available in the market. A similar scenario holds true for tires as well. Enthusiasts will typically purchase a set of new tires to go along with their custom wheels. And, contrary to what some might think, not all tires are created equal. Some are meant for high-performance driving, others are for off-road use, and still others are made for wet road conditions.

In recent years, the original-equipment manufacturers (OEMs) have ventured into the custom wheel market. Option packages now include wheel upgrades on many vehicles, such as the Chevrolet Silverado and Dodge Ram 1500. Many vehicles have been equipped with performance tires. For example, the Cadillac STS comes standard with tires made for performance driving, and a Chevy Tahoe Z71 off-road package includes off-road tires. In cases such as these, it is more likely that a vehicle owner would simply change the wheels rather than the wheels and tires together.

What SEMA Members Are Saying

One of SEMA’s numerous councils is the Wheel & Tire Council (WTC). Input from council members is very valuable when trying to get a handle on the market. After all, these folks are the ones who live the market every day. According to some WTC members, 2009 is down a bit compared to 2008 but, as most of them mentioned, this was to be expected. Carl Robinson of Mickey Thompson Performance Tires noticed that wheel sales are down, particularly for 4x4 vehicles and lifted trucks. On the other hand, companies such as BMF Wheels, which has introduced new wheel designs, have noticed an increase in sales in the past couple of years. Barry Horlick of Voxx Products Inc. believes that “…sales for calendar year 2009 will actually be slightly better than the previous calendar year,” with the expectation that the last four months of 2009 will be healthier than the first eight.

SEMA members have noticed some trends in the wheel and tire market as well. It seems that 17- to 20-inch wheels remain the most popular. WTC Select Committee member Kelly Austin pointed out that trends often differ across different regions of the United States. He said that it’s best “…to listen to your wholesale customers and attend car shows where your products are sold most.” Horlick noticed an increase in sales of OEM replacement-size wheels as dealers work to jazz up their vehicles to move inventory.

In the 4x4 market, some of the most popular vehicles customized with aftermarket tires are Ford and Chevy pickups, Toyota FJ Cruisers and Jeeps, according to Robinson. Russ Fuller of Revolution Supply Inc. has seen an increase in demand for wheels and tires for Ford vehicles. And Horlick noted an emphasis on options for “…CUV, passenger and tuner applications rather than for the truck and SUV market.”

In fact, there may be a correlation between wheel purchases and the decrease in sales for trucks and SUVs and subsequent increases seen in the CUV market. The specialty-equipment market has typically ignored the customization of crossover vehicles, but as the popularity of this segment grows, more attention should be focused here.

In the 4x4 market, some of the most popular vehicles customized with aftermarket tires are Ford and Chevy pickups, Toyota FJ Cruisers and Jeeps, according to Carl Robinson of Mickey Thompson Performance Tires.

Brandon Stotsenburg of Mobile Awareness LLC mentioned the customer’s need for value. Joe Schaefer of Konig Motoring Accessories echoed that sentiment: “Whenever we deal with a tough economy, we always find that people become better shoppers and look to get the most for their money.”

Custom Wheels

One-piece cast wheels represent the majority of custom wheels offered today. These wheels can be painted, polished or chrome plated. Painted wheels—particularly black—are a popular choice among enthusiasts.There are more and more companies offering wheels that look similar to race-car wheels. As mentioned earlier, forged-aluminum wheels are popular for truck owners who tow a lot of weight. Forged wheels are much stronger and more structurally sound than multipiece wheels. Interestingly, multipiece wheels are typically at the higher end of the price spectrum of the custom wheel market. The wheels, often referred to as “bling,” usually fall into this category. SEMA market research reported that custom wheel sales reached $3.8 billion in 2008 in retail sales, down from $4.7 billion in 2007.

Performance Tires

There are various types of performance tires offered in the market today. Tires are made for high-speed driving, racing, snow conditions or off-road use. Enthusiasts with pickups will often replace their stock tires with a set that has a much wider stance. Owners of vehicles such as the Chrysler 300 or Cadillac Escalade will often choose low-profile tires—the type that does not have much rubber between the wheel and tread. Street-performance vehicles will typically be equipped with performance-built tires. In many cases, the tire sizes differ between the front of the vehicle to the back.

Enthusiast Data

Overall, the wheel, tire and suspension category rose nearly 2% in retail sales and 3% in manufacturer sales from 2007 to 2008 (See Chart 1). Light truck is the niche in which wheels, tires and suspension represent the largest percentage at $1.29 billion in manufacturer sales (See Table 1).

SEMA’s market research department has traditionally surveyed automotive enthusiasts throughout the year to track various buying trends. In the 2008 Automotive Lifestyles Survey, SEMA found that 33% of enthusiasts had purchased custom wheels for their vehicles, while 19% planned to purchase custom wheels in the next 12 months. Twenty-four percent of enthusiasts had purchased plus-size tires, and 36% had purchased performance tires. Eleven percent planned to purchase plus-size tires, while 16% planned to purchase performance tires.

The 2009 SEMA Show will be home to more than 260 wheel and tire companies for four days. The aisles of lower South Hall at the Las Vegas Convention Center will be filled with shiny wheels and tires of all sizes. Attendees will have the opportunity to view the latest trends in the wheel and tire market and be able to talk directly to the companies that design and produce them. Some of the most exciting features of lower South Hall are vehicles equipped with the latest and greatest that wheel and tire manufacturers have to offer.

Wheels and tires might be a necessity, but that does not mean they can’t be cool.