That’s the date from which the 115 million tyres sold in the EU every year will have to carry a label telling customers how energy-efficient they are, how safe they are – in rain – and how loud they are. And although I’m not one to easily claim success, I think it’s fair to say we played quite a role in making this happen.
But the point of this piece is not to tout our success. It is to tell a little tale of political history, and a very illustrative one. It is that, once again, it took an EU law to shake up innovation in an industry, this time the EU tyre industry which has an annual revenue of €30 billion. That industry was not exactly enthusiastic about the label, and it opposed outright it for trucks, and for noise. Progress on rolling resistance and wet grip values had been slow. The best values for car tyres had for years been hovering around 8 kg/tonne, which equates to a C-label. Average values were much worse, in F-G territory. According to an impact assessment, a ‘quick take-up’ scenario might mean A-label tyres could capture 23% of the market by 2020. The situation for truck tyres was not much different.
And look what has happened since the labelling law was adopted! Over the past few months, Europe’s tyre makers have been falling over each other in announcing A-A tyres (rolling resistance and wet grip respectively). And that’s not just for car tyres but also in the truck tyre segment, a segment the industry had argued was already completely optimised for rolling resistance because truck buyers were supposedly very rational and very interested in low-energy tyres. A market survey we quickly commissioned showed this was a myth; and even if there had been an interest in buying low-energy tyres, objective comparisons were just impossible. Counterintuitive as it sounds, it took an EU law made to make it all understandable.
And you know what, Europe’s tyre industry now loves the label and is spending huge resources promoting it. Not because of a newly-discovered love for the planet, but because they can now better explain what makes their product different from cheap competitors, mostly imports. Previously, all tyres were just similar black rings; the label has made them a bit more colourful.
A few lessons here. The first, and most important one, is not very original, but it’s still worth repeating: once again it took regulation to unleash the full force of business innovation and ingenuity; the market alone just did not do it. Once more we underestimated the speed of adaptation. Second: don’t assume professional buyers are fully rational and know everything; they can behave like human beings too! This is an interesting lesson for all those thinking of fuel efficiency labelling and standards for trucks and aircraft. Third, if the industry is capable of moving from C to A within 18 months, you have to conclude the limits for the A-label were again too modest.
There is one more lesson from the ‘white goods’ sector that we should apply to tyres. A review of the law is already coming up – let’s please avoid the mistake of introducing incomprehensible A+, A++ etc labels, and make the A-G bands more stringent instead. Everyone understands that green is better than red; very few understand that dark green is better than light green. And there need to be ‘reds’ for the ‘green’ tyres to work and to keep innovation going.
Does all this matter for CO2? It won’t tackle climate change by itself, but yes it does. A move from C to A cuts fuel consumption by about 3%, saving some 30 megatonnes of CO2. I wish we had that sort of abatement in every one of our campaigns. And all that by putting a little green in all those black ring.