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Pirelli inflates Australian sales

Pressure test: Pirelli is focusing on premium and prestige brands in Australia with a broad strategy that looks at suppliers, customers and the company’s brand recognition.

Aggressive growth strategy on track to exceed Pirelli premium sales targets

General News logo16 Mar 2015

PIRELLI'S ambitious plans to double Australian “premium and prestige” segment tyre sales by 2017 are on track to exceed the targets set in 2013, with last year's growth already topping 50 per cent.

With more than half the required target already achieved, the Italian tyre-maker is likely to more than double sales of 18-inch tyres and larger ahead of the planned timeline, but it is sticking to its original strategy.

While the company continues to offer a comprehensive range of tyres across all markets in Australia, for the last two years it has placed more of an emphasis on securing a greater share of both replacement and original-equipment segments at the higher end.

With their increasing use of larger high-profile tyres and large-diameter rims, the European imported brands and in particular the German manufacturers have been the main target for Pirelli.

Speaking at the Australian Grand Prix last week, Pirelli Tyres Australia managing director Andrea Clerici told GoAuto the aggressive strategy was working as planned and the company would be sticking to it.

“It's going well,” he said. “Basically last year we had an increase of over 50 per cent in that specific segment and within general growth we were close to double digits in terms of total volumes.”“The plan has not changed. The strategy has not changed. We are continuing with a consistent approach, which I think is reflecting the overall worldwide Pirelli approach.

“We are not looking for absolute market share. We are not growing our overall capacity but focusing more on our premium capacity that reflects also on our choice of original equipment partnerships.

“We have a selective approach so we focus very much on premium and prestige partners, premium being Audi, BMW, Mercedes and prestige being Ferrari, Maserati, Porsche.”

When asked if exceeding targets was a possibility, Mr Clerici replied “hopefully so, that would be my plan,” and explained a changing car market had helped achieve the positive results.

“We see the market is also helping us in that regard. If you look at the new-car registration trend and the replacement-tyre market trend we see a strong shift in more European cars being imported to Australia,” he said.

“Looking at the total registration market, we haven't seen a boom but we've seen a market driven by the import brands – especially the German brands, driven by the SUVs, which enjoyed double-digit growth, and a detriment of the more traditional domestic brands like your Ford and Holden.

“The German brands are usually fitting higher-inch tyres and rims so this is helping. It's a combination of the original equipment fitment and the technical choices of the brands.”

Mr Clerici went on to say that part of the strategy was to improve consumer and supplier education.

By increasing training for its suppliers and boosting Pirelli brand promotion, the company says customers and manufacturers are making more informed decisions, while understanding the differences between its own products and the competition.

“There is a complete 360-degree picture starting with motorsport activities, linking it to the original equipment focus and then a replacement market approach that is reflecting a strong pressure in these segments of the market,” he said.

“Obviously we are a global supplier so we don't disregard the other segments.

We have a complete offer to the market but from a strategic point of view, the focus and the push is on that part of the market.

“The growth of last year has pleased us, because we have been facing a very challenging market.”

Surprisingly, Mr Clerici says involvement in the Formula 1 Grand Prix (for which Pirelli provides the tyres) has had little effect on Australian sales, with many Aussie racing fans only interested in F1 during the local race weekend and more focus on non-Pirelli-supported sports with more Australian “superstars”.

“Personally I receive more requests for tickets to the V8 Supercars than for the Formula 1.”

Pirelli does not supply tyres to the homegrown touring car series.

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