Think of the top 10 tire brands. Brands like Firestone, Bridgestone, Goodyear, Michelin, and BF Goodrich probably come to mind – companies that have been around for as long as tires.
Nexen Tire probably isn’t on your list. But it will be soon.
Nexen’s team has made it their goal to make your top ten tire list. And they aren’t just striving for name recognition – they want you to think first of quality when you think of Nexen. The company has never had to recall a single product, and they plan to build on this reputation of quality and consistency.
Nexen isn’t new to the tire game; it started in Korea in 1942, as Heung-A Company. Heung-A, Korea’s first tire company, offered manufacturing capabilities to other companies. Heung-A, later known as Woosung Tire, manufactured the tires for other brands. In 2000, the company branched out with its own product and renamed the company Nexen, a combination of the words “Next” and “Century.” As its name indicates, the company puts quality and innovation at the forefront of its designs.
For the last 15 years, the company has had a singular focus: manufacturing well-designed, well-made tires. Nexen may not be well-known in North America just yet, but they’re already a top-tier tire producer. The next step in making a name for themselves is branding.
Nexen hasn’t done a lot to brand itself since its revamp in 2000. “We’ve invested in quality and R&D, not marketing,” says Kyle Roberts, Director of Marketing for Nexen USA. In fact, Nexen spends more on R&D than any other tire manufacturer. The company doesn’t plan to spend any less on R&D, but has allocated more budget to marketing initiatives and advertising campaigns to better spread the word about its technology. It’s also stepped up its visibility in the motorsports world.
Breaking into the OE market
Currently, Nexen’s bread and butter is in the replacement tire market (the tires a consumer buys when their car needs new tires), which accounts for about 70 percent of current business. That number is headed for a more even split as the company breaks into the auto manufacturer market (also known as the OE market), a goal it began to pursue in the mid-2000s. OE (original equipment) tires are the tires that come on a car when it’s new from the factory.
The development of OE tires is no small feat. It’s a two- to three-year process to even get in the door to pass all an auto manufacturers’ specs and qualifications. “This is just to be considered for one of its vehicles,” says Roberts.
Once a tire company clears the hurdle of getting its foot in the door, it has the opportunity to design and bid on one of the manufacturer’s models. This part of the process can take 18 months to two years, and there are only 11 tire manufacturers in the OE market. People often think that you can put any tire on a new car. But tires are actually designed for specific cars, fine-tuned to the manufacturer’s specs, all so the vehicle will perform the way it was designed to perform.
For example: If a manufacturer is designing a performance car, it’s going to want specially tailored traction and cornering ability. If it’s designing a touring vehicle, it’ll need a tire with longer tread wear and a smoother ride. And for a pickup truck, the manufacturer will consider a tonnage requirement and traction.
This process and real-time data exchange involves many long-term relationships between sales, engineering, and the car manufacturers. And the process, all with stringent guidelines and specifications, takes time — usually a couple of years — to see a product come to fruition. Engineers must be on top of their game and in tune with the design team’s strategy. The tire will change multiple times during the course of development.
In 2012, Nexen didn’t sell a single tire to the OE market. Today, they’re selling more than 2 million each year. Roberts says the replacement market will still grow (25 percent of car owners replace their tires with the OE-brand tires) but their growth initiatives in the coming years will be primarily focused in the OE market.
Innovations and future plans
Nexen has a lot in store for the future. Most of these new developments are still under wraps, but one that Roberts is excited about is the N’Fera SUR4, an extreme performance tire that can be used for competition. It’s designed for ultra-high-end sports cars and will be available for the 2016 season.
Nexen’s innovations are gaining notice and winning awards. It’s the only tire company to win all four of the “grand slam” of world design awards. The winning streak started in 2011 with the IF Design award, followed by the Red Dot Design award in 2012, G-Mark in 2013, and finally the IDEA award in 2014.
To win the IDEA award, its most recent claim to fame, Nexen had to create a concept tire that was creative, aesthetically appealing, benefited the environment and society, and was feasible to manufacture in the future. The result was The Green Hive Project, a tire design that allows tread blocks to be replenished. This means that one set of tires could last for the life of a car. It’s still just a concept, but one we may see more of in the future.
The auto industry is moving fast, from sensors and cameras to self-driving technology, and the tire industry is no different. One of the biggest innovations in the car market today is the electric car, says Roberts. Electric car owners obviously have a high level of eco-consciousness, and the cars subject tires to extreme torque and instantaneous acceleration. This means the tires designed for electric cars need both powerful traction and low rolling resistance. Though it doesn’t seem particularly difficult to develop a tire with two different attributes, these two require design in different directions, while also maintaining safety as the foremost priority. Striking this balance is Nexen’s most recent and pressing challenge.
“Nexen’s number-one core value, and the center of our mission statement, is to provide the highest quality tires that deliver a smooth and comfortable ride,” says Roberts. Nexen has been living this mission for 15 years and will continue for the next 15. In the coming years, look for Nexen to emerge as one of the “big names” in tires, as people learn more about their quality products and innovative designs.