Dive Brief:
- The introduction of intelligent tires into EVs presents a growth opportunity for the Goodyear Tire & Rubber Co., CEO Rich Kramer said during a Q2 earnings call.
- Tires are expected to wear out faster under the weight of EVs, which are typically heavier than their gas-powered counterparts, Kramer said during the call. This creates an opening for Goodyear to ramp up its involvement in tech-connected products that can better handle electric vehicles.
- The tire maker moved to capitalize on the growth potential of intelligent tires in March, when its venture capital arm invested in tech firm Nova Labs. Nova Labs’ decentralized data connectivity solutions "will help expand the possibilities for future adoption and scaling of intelligent tires," Kramer told investors during a Q1 earnings call.
Dive Insight:
Intelligent tires use sensors with cloud-based algorithms to monitor tire conditions and communicate with fleet operators in real-time, Goodyear said in announcing the product’s debut in June 2021. The tech was expected to be piloted in cargo van fleets in the field service, construction and last mile delivery industries, the company said in the announcement.
The tech works through contact patches, which collect information from where the intelligent tires meet the road. The patches will take on added significance as EVs and AVs evolve, Kramer said in the latest earnings call, and the company hopes they will eventually be able to monitor and share road conditions.
The CEO called Goodyear’s growing portfolio of partnerships evidence of its success in innovation, which he pledged would continue regardless of market conditions.
"Tire intelligence and the knowledge of what is happening at the connection with the road through the tire contact patch is a job we uniquely do," Kramer said. "More to come on this technology, but note that our focus and investment will not be deterred as we navigate a tumultuous economy."
The company rolled out a replacement tire specifically for EVs last year. The Goodyear Electric Drive GT sells for a starting price of $273 per tire, more expensive than many of the company's other tires. The company aims to incorporate tire intelligence in all new products by 2027.
Goodyear is also establishing a foothold for its intelligent tires in the AV market. Goodyear Ventures, the company’s venture capital arm, invested in autonomous truck maker Gatik last fall with plans to outfit its medium-duty fleet with its Goodyear SightLine-equipped tires.
Increased adoption of intelligent, connected and more expensive tires bodes well for Goodyear. Goodyear's overall revenue per tire increased 14% YoY in Q2, excluding currency impact, and rose more than 20% in the Americas region, CFO Darren Wells said during the call.
