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Empowering Mobility Innovation through ‘OE Tire Business’

When a new vehicle is shipped out, it comes equipped with OE (Original Equipment) tires. These tires are developed under very stringent conditions set by global automakers to ensure optimal vehicle performance. Hankook Tire has achieved constant growth and innovation in this market, where only about 20% of tire manufacturers can enter due to the high entry barriers set by car companies. This need for innovation has contributed to the development of the mobility industry.

Empowering mobility innovation through OE tire business

Innovation 1. A Car Platform Started with Tire Innovation

The birth of the automobile tire

Automobile tires have been the driving force behind the evolution of the mobility industry, both in name and reality. Throughout history, automotive tires have played a pivotal role in logistics and transportation innovation, facilitating the expansion of automobile applications from military and cargo transport centers to personal use. This contribution has made the 20th century known as the era of automobiles and airplanes. Let's explore how these tires emerged and shaped the way we move.

How car tires were born:

  • | In 1848, Robert W. Thompson in England attached raw rubber to the iron wheels of a stagecoach, marking the beginning of the rubber tire.
  • | In 1888, John Boyd Dunlop, a Scottish veterinarian, put rubber on a metal wheel of a bicycle and put air in it, giving birth to the 'pneumatic tire,'—the basic structure of the tire we know today.
  • | In 1891, French brothers Andre Michelin and Edouard Michelin developed a tire that could be attached to a bicycle wheel. Later in 1895, when the technology was applied to automobiles, the development of automobile tires began in earnest.
  • | Subsequently, a British inventor discovered that carbon black, a fine carbon powder, could enhance the stiffness (Abrasion resistance) of rubber. This led to the development of automobile tires with this technology in 1915, significantly improving automobile performance.
  • | As a result of accumulating various technologies including mass production of synthetic rubber, the Michelin brothers successfully developed a radial tire* similar to today's product in 1948. With the expansion of road networks in Western Europe and the United States during World War II passenger cars’ speed increased, the radial tire technology gained popularity.
    • *Radial tire: The most commonly used tire to this day, distinguished by high lateral rigidity, as the tire cords that increase tire durability and stability are arranged in a circumferential direction. It provides excellent acceleration and stability, making it the preferred choice for high-speed vehicles.

    What does 'OE tire' mean in today's automobile market?
    A reliable partner to help your car achieve its full potential

    Since the development of automobile tires in 1915, there have been countless innovations in the tire market, ranging from tire materials to its structures and shapes. Today, the potential performance achievable from the tire itself is truly boundless. In this modern era, the tire exists as a crucial determinant not only for a driver's safety but also for enhancing car performance and the resulting driving experience.

    Empowering mobility innovation through OE tire business

    Currently, automakers meticulously assess, review, and enhance the performance of OE tires during the new car planning stage. In particular, premium brands place very strict conditions on the development of OE tires. To meet these demanding conditions and implement the suitable technologies, the tire industry must demonstrate a very high level of source technology, development (production) capacity, and proactive commitment to technological investment.

    • Hankook Tire supplies tires to 39 global brands and can be found on around 250 vehicle models. 

    Innovation 2. Hankook Tire’s Premium OE Business

    Hankook Tire, garnering attention as a ‘rising star’ in the global OE market
    Becoming a ‘leader in the premium OE market’

    STEP 1. Entering the premium OE market amid interest from the automobile industry

    Hankook Tire's premium OE project began in 2006 when the Ford F-150 was in full swing and gained significant momentum with Audi's entry into the A3 in 2009. At that time, Hankook Tire seized the opportunity to announce the start of Premium OE to the global audience, as highlighted in the October 2009 CNBC economic program ‘Managing Asia.’

    “Does Hankook Tire have a plan to supply OE tires to
    the brands such as Toyota, BMW, and Mercedes-Benz?”

    • Christine Tan, Anchor of ‘Managing Asia’

    “It takes time to meet our customer's need, however, as we demonstrated for Audi and Volkswagen,
    there will be no problem with supply if we do our best.”

    • Hankook Tire Management 

    A Hankook Tire executive gave this answer to a question posed by Christine Tan, anchor of ‘Managing Asia’ at the time and garnered substantial attention as a ‘rising star’ in the tire industry, thanks to our aggressive capacity expansion in China and Hungary, and our stable overseas sales portfolio. The declaration of entry into the premium OE market cemented the status of Hankook Tire as a prominent player in the industry.

    Since then, Hankook Tire has firmly established itself as a fearless challenger in the premium OE market by succeeding in business with prestigious brands such as BMW and Mercedes-Benz. In addition, stable quality, excellent performance, and above all, reasonable prices compared to top-tier competitors helped Hankook Tire establish its solid position in the premium OE market. This was achieved in just over 10 years after Hankook Tire started its full-fledged overseas OE business, marked by the supply of Ford F-150 tires.

    • OE tire partners of Hankook Tire

    STEP 2. Expansion of presence through strategic brand partnerships

    Hankook Tire strategically established an R&D center and office for OE tires in the European market to communicate closely with premium automakers. This establishment allowed Hankook Tire to continue development of OE tires while optimizing them for premium European brands. Simultaneously, we expanded operations to China and Hungary, establishing a stable tire development technology and infrastructure for the OE domain. As a result of these efforts, our market share in Audi, BMW, and Mercedes, experienced steady growth and solidified our position in the OE tire market.

    Building on the success in Europe, Hankook Tire entered the Chinese market where the Premium OE segment is quickly growing and accelerating a gradual supply of tires to sedans and SUVs. Since 2015, we have proudly supplied tires to Porsche, the luxury brand of the Volkswagen Group, another mark confirming Hankook Tire’s potential in the Premium OE domain.

    Empowering mobility innovation through OE tire business

    Porsche 718 Boxster with Ventus S1 evo3 

    STEP 3. New wave called EV, the beginning of another innovation

    Electric vehicles were originally developed in the early days of automobile technology, however, they were abandoned as viable options for nearly 100 years due to immature charging and driving technologies. It wasn’t until the late 2000s, a time when the fuel efficiency of internal combustion engines was maximized and the global car population was projected to soar up to 2.4 billion by 2050, that the movement for mass production of electric vehicles resurfaced. Tesla, foreseeing the limited gasoline resources, and the Chinese government acknowledging they wouldn’t be competitive in the internal combustion engine market, were instrumental moments in revitalizing the endeavor for electric vehicles.

    Hankook Tire, which was contemplating its direction in the future mobility space at the time, supplied tires to Tesla’s Model 3 recognizing the firm vision the company had for the electric vehicle market. As a result, Hankook Tire successfully entered the OE tire market for electric vehicles.

    At Hankook Tire, we believe that an exclusive tire for EVs could be a game changer in the automobile market. In this vein, we proactively promote our supply of OE tires for EVs fostering partnerships with Chinese electric vehicle manufacturers. And as of July 2023, Hankook Tire is proudly supplying OE tires for EVs to more than 10 renowned brands around the world. Our commitment extends beyond Tesla and includes Porsche Taycan and Audi e-tron. This dedicated effort has allowed us to take a leading position in the EV OE market.

    Empowering mobility innovation through OE tire business

    High-performance electric sports car Porsche Taycan with Ventus S1 evo3 ev

    Recently, Hankook Tire launched a full line-up tire for EVs for the first time in the world with ‘iON’, a brand dedicated to EVs, which would contribute to solidifying our position as a 'leader in the EV market'.

    • iON, the world’s first tire brand exclusively for electric vehicles with a full lineup

    Innovation 3. A Future Prepared by Hankook Tire

    A new path of innovation that Hankook Tire will pave

    For the past 70 years, the tire industry has stood as a frontline industry in the automobile sector, offering independent part expertise and making significant contributions to the development of the Korean automobile industry and economic growth. Despite having a modest 2% share of the global domestic market, Hankook Tire has grown to become the world's 7th largest tire company thanks to accumulated performance and a commitment to actively pioneering the global market and preparing for the future.

    Hankook Tire's OE tire is not content in the success achieved so far. As the development of self-driving technology progresses, the emergence of unmanned vehicles, like robo-taxis, is imminent. To remain at the forefront of the future mobility market, the industry must proactively secure various original technologies.

    Empowering mobility innovation through OE tire business

    i-Flex, a non-pneumatic tire

    Our commitment to innovation is evident through initiatives like the airless tire, initially designed for the military, but soon to increase use among the public. Additionally, our sensor tires, capable of wirelessly sharing tire status and driving information with other vehicles, reflects our dedication to cutting-edge technological advancements. We also recognize the increasing importance of sustainability-related technical capabilities in the European market and strive to meet those demands.

    Therefore, it is Hankook Tire's dream to be a true core value in the future and to consistently and steadily develop our innovation DNA, allowing us to have more agility in the OE tire market. Through these efforts, Hankook Tire aspires to leap forward as a world-class mobility and tire brand, loved by top-class mobilities worldwide.