Market Analysis Report for Passenger Car Replacement Tires in Canada
The rolling resistance of passenger vehicle tires developed for the new vehicle market has significantly improved because automakers require low rolling resistance tires to help meet greenhouse gas and fuel economy standards. However, tires sold in the replacement market lag behind. While about 26% of the 26 million passenger vehicle and light truck replacement tires sold annually in Canada are marketed as “fuel efficient”, manufacturers generally do not provide a specific basis for these claims. Thus, consumers cannot objectively determine which tires will provide significant fuel savings. In addition, many consumers are not aware that tires affect fuel economy.
Passenger vehicle replacement tire standards can narrow or eliminate the gap between the new vehicle and replacement market and support the Pan-Canadian Framework on Clean Growth and Climate Change. Standards could potentially improve fuel efficiency by about 1.4-1.6%, which would avoid an estimated $300 million in consumer fuel purchases and 718,000 tons of greenhouse gas (GHG) emissions annually, while also reducing other air pollutants.
Replacement tire rolling resistance can be improved at little or no cost by applying technology used for tires fitted on new vehicles. A recent paper published by Transport Canada and the U.S. National Highway Traffic Safety Administration on the replacement tires market found that “There were no trends observed between pricing and rolling resistance in both the Canadian and American marketplace. Tires [can] be obtained with good low rolling resistance characteristics at a low purchasing price in both markets.” Canadian and other manufacturers who responded to questionnaires about the potential impacts of standards tended to indicate that existing technology could be deployed at low cost, while new technology development would very likely require cost and/or other trade-offs.
Fortunately, Canada can draw on many existing international precedents to develop standards. ISO 28580 has been adopted in the European Union and much of Asia to measure tire rolling resistance and in California to regulate heavy-duty truck tire rolling resistance. ISO 28580 has also been established as the test method for future U.S. passenger vehicle standards under the “Fixing Americans Surface Transportation (or FAST) Act”. In addition, the United Nations Economic Commission for Europe (UN ECE) Regulation 117 wet grip test method is commonly used in Europe and Asia to improve this aspect of safety. Manufacturers in Canada and elsewhere already test tires sold in the Canadian market according to ISO 28580 and UN ECE Regulation 117 wet grip test procedures. The number of specific individual tires (typically defined by a specific brand, size and speed rating) that are tested varies between companies.
Carefully designed standards that leverage these precedents are not likely to adversely affect the market. For instance, the three tire manufacturers with manufacturing plants in Canada were asked to respond to a questionnaire about the potential impacts of a standard. Two of the three companies responded and they stated that applying standards similar to the EU standards would not affect availability of products available in the Canadian market, nor put Canadian manufacturers at a relative disadvantage. (Canadian manufacturers produce an estimated 16 million passenger vehicle and light truck tires sold per year). Another key questionnaire response stated that an allowance will be necessary for winter tires and also some other less common sub-categories with specific performance characteristics. Winter tires are the second most common category of tire sold in Canada behind all-season tires, and currently receive an additional allowance under EU standards.
Questionnaire responses from the two Canadian manufacturers and three questionnaire responses from companies that manufacture tires elsewhere stressed the importance of harmonization. Harmonization with the U.S. market is a key concern for a number of manufacturers, which is not surprising given that nearly all passenger vehicle tire models sold in Canada are also sold in the U.S. Harmonization with EU standards is another concern. In addition, harmonizing laboratory alignment processes for ISO 28580 testing with the EU alignment process were also highlighted as a way to ensure adequate testing resources are available, and provide reliable and repeatable results while also minimizing cost.
This report also contains information on additional steps for standards development. It provides a stakeholder outreach strategy and contact information, and identifies several potential areas for additional research to support standards development including:
- analysis of potential standards levels and potential adjustment for specific tire attributes;
- evaluation of potential opportunities to harmonize with EU laboratory calibration processes;
- evaluation of potential compliance systems including a compliance database and opportunities to harmonize with compliance systems that are implemented in the EU; and also systems that will potentially be implemented as part of future U.S. standards; and
- evaluation of complementary policies to further improve rolling resistance.
In summary, improving the rolling resistance of passenger vehicle replacement tires is a cost-effective option to avoid GHG emissions and reduce consumer fuel bills without negatively affecting safety or the marketplace.
If you wish to receive a copy of the full report, please email: NRCan.alternative_fuels-alternative_fuels.RNCan@canada.ca.
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