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Interview: Christoph Kalla, Lanxess

Labeling is set to change the tire industry at every level. Lanxess' vice president marketing and R&D explains what will be affected and how

by John O'Brien

 

Specialty chemical company, Lanxess has close links with the tire industry. Christoph Kalla, vice president marketing and R&D, states that ‘mobility and green mobility are close to the hearts of Lanxess’, but how does this passion relay itself to the end product?

TTI: How do you assess the labeling situation?
Tire labeling has evolved from an environmental matter, to a market matter. Because it is set to be a game changer and reshape the trajectory of the tire industry, not only in the environmental footprint, but also in terms of changing the product from a commodity to a highly differentiated, high-performance car part.

Christoph Kalla: People will always look at the price. But they need to realize - and this is the education that needs to take place – when you buy a tire and look at the CO2 footprint, only 10% is related to what goes into it, 2% is the transport and logistics of the tire and 87.5% is the usage of the tire, the fuel you burn. So if you pay €20-50 more for a decent tire, this cost will be recouped within a year or so. People really need to put these costs in perspective – just how expensive it is to buy a cheap tire.

It would be foolish for me to argue that the 90% of people who don’t know about tire labeling were asking for it. As with the legislation regarding refrigerators, it was a Government driven initiative, but whilst the Government may be the initiator, they are not the manager. The tire manufacturers will manage it but the consumer, in the end, will dictate it.

I also think some people underestimate the power this initiative has to change to the whole market in many ways. Let’s say you have a start-up company focusing on something and finding out that they can improve certain properties in other ways. In the past, how could a new company stand a chance against the big names? People would just not buy them. But in the future, that certifies that the tire is actually quite good, then perhaps they will have a niche chance to survive in that sector of the market

How can Lanxess help consumers understand labeling better?
We have created a ‘Fuel savings calculator’ app (See below) which has a various variables, and you can put in what you are driving, where you are driving and it will show you between this category tire and this one, you can save €400. And I’m sure people will say “No, that can’t be right, let’s try again” as the numbers involved are just huge.

But how do you communicate that to the consumer? Many people make a direct relationship between the burning of the fuel and where it is ‘consumed’. What people don’t realize is the molecules within the tire, more or less vibrate and this movement creates heat and this heat is wasted energy that does not go toward forward motion. But a fuel saving calculator, where people can see an actual figure, is likely to convince them more. By allowing people to fiddle around with the sliders, its fascinating people, as they can understand that they should inflate their tires, as it is not only a fuel matter, but also a safety issue. So they immediately run out and pump up their tires. It’s the quickest win; just inflate your tires correctly.

So we are focusing a lot on how the consumers perception of the tire will change; from just that ‘black, round thing’ to a product with real value. And what does this, in the end, mean to the molecules that we are producing?

How do you view is sustainability’s influence on the tire industry?
My personal opinion is that China will become, at some point, the front-runner in terms of the sustainability industry. They have announced a similar scheme that is voluntary at first before becoming mandatory; Brazil has announced a scheme too, whilst Korea and Japan have already done this. So this is a clear signal that sustainability will be more important. This, of course, also has something to do with the fact that there will be another 800 million middle-class people, by 2020, in the BRIC countries alone. And they all want to be mobile, they all want to consume, so you will have roads being constructed etc, so sustainability is no longer just something that is ‘nice to consider’, it will be an ‘enabler’ of mobility, growth and prosperity. And nowhere in the world will you have an island of non-sustainability simply because it doesn’t work.

Which is also part of the reason why some people may wonder why a rubber manufacturer is concerned. ‘You make molecules right?’ Aside from the obvious point that we have the molecules that make the tires better, we also are interested in this enhanced awareness. What is the contribution that a specialty chemical maker makes? We can significantly reduce the CO2 footprint and I am absolutely convinced that the consumers around the world will begin to think less about the trade off between cost and environment.

How is this shift toward ‘green’ tires affecting your R&D processes?
I’d say that our R&D people are definitely the busiest in Lanxess, with our increased resources; we are in the process of expanding our R&D operations again. So I think, nowadays you also have to change the R&D approach. In the old days, rubber makers would do their own R&D. They would then give a sample to a manufacturer who would then do their own R&D. You would then get a binary answer: it either works, or doesn’t. Then you go back, and make another sample.

This isn’t how it works now. As a producer, we must be able to screen materials under various, real-life, conditions. Lanxess is in a position to do this; we can run tire tests on new materials as a polymer producer. At the same time, the level of knowledge, depth of data we are exchanging has also increased. To make a polymer successful, it is not only its molecular structure; it’s also how it runs through the customer’s machine – if you don’t get good filler dispersion, you will never have a good tire. So the type of approach has to change.

Especially in EVs, the tire thanks to its lower rolling-resistance has quite an impact. OEMs are thinking ‘Maybe for that additional 50 miles we don’t need a bigger battery pack, we need a better tire’. Some automakers are not only talking to tire manufacturers anymore, they are coming directly to us because they want to know what is possible in the next few years. All of this was unthinkable a few years ago, so this little label makes a big difference.

Real-world solution:
In light of the forthcoming labeling requirements, Lanxess has produced an interactive application for smart phones and tablets. The app allows customers to compare a variety of tire styles before presenting them with the overall difference in cost. The apps multiple sliders allow users to alter driving style, conditions and range before working out a representative figure for the end user. The screen shot shows how the app relays the potential savings to the customer. 

 

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