Hankook Tire is the seventh-largest tire manufacturer globally by sales. In a recent development, the maker will supply Hankook tires as standard equipment for the Tesla’s Model Y. This is following an announcement that was made by industry officials on Monday.
Hankook already supplies a set of 19-inch tires for the Model Y produced in Tesla’s plant located in Shanghai. The supply takes care of the Chinese market as well as other countries around the world. The Korean market may receive something different since Tesla will sell models imported from the United States.
The Model Y came after the Model 3. It’s the latest model to be introduced in the Chinese market. Since it’s launch in the U.S., it has sold about 70,000 models. The recent tire supply agreement between the Korean tire manufacturer and Tesla is an expansion tactic. The former has been supplying tires to the latter since 2016.
Hankook has also entered into contracts with other premium car manufacturers since entering the EV sector. Last year, it was fortunate to supply tires to Porsche’s EV Taycan. The company has also entered into an exclusive agreement for the 2022-2023 season with the ABB FIA Formula E World Championship, a renowned race even for electrically powered cars.
EV tires tend to have higher technical requirements than those made for regular gas-powered vehicles. EVs weigh more. The extra weight adds wear to the tires. They also require low-noise requirements since EVs are pretty quiet. Road surface noise tends to be quite high in EVs since there is no engine noise.
In comparison, Hankook tire is expected to lose to foreign rivals in the domestic market. More than 29 million tires were sold in 2019, and foreign brands accounted for 18.1 percent. This increased from 8.2 percent in 2016.
Korean tires have also been losing market share. As of October last year, sales dipped to 23.6 million. This is compared to 32.8 million sales in 2017. The downward trend has seen Koren manufacturers calling upon the government to formulate policies that support local tire makers.