According to Mr. Vilmos Tokaji, Head of Sales Region Southeast Europe at Continental Tires, sustainability criteria and ever-higher technical standards are compatible. How? We also discussed the slowly starting up economic recovery, the crisis resistance of the premium segment and the meaning of the “AAA” EU Tyre Label value category.

How do you evaluate the situation of tyre manufacturers? If I were a Continental shareholder, would I have to watch the stock market news every day?

After a more difficult period the demand is expected to recover. In the tyre market we are coming out of a correction, which was felt both in Europe and Hungary. This was not only due to weak end-user demand, but also because dealers made significant stock reductions last year.

As they have been accumulate a rather huge amount of stock in the past.

There was a relatively significant price increase due to rising costs in 2021-22, and traders were also stocking high due to other global economic factors, such as defending against shortages in certain product categories. Their move was logical, as holding stocks in a rising price environment means less risk. Last year, the trends changed and retailers started to reduce their stocks, which also affected manufacturers’ sales figures. This year that is changing; end-user demand rising, inflation curve flattening and real wages rising again. Of course, the continent is not homogeneous, there are faster growing and more saturated markets where motorisation is no longer growing, but Hungary has a good chance of continuing to catch up to the European average. There is still room for improvement in car use. In the longer term, if purchasing power increases, it will affect mobility and our industry on a positive manner. We are optimistic about the future.

Continental is recognised as one of the highest quality manufacturers, producing not exactly cheap tyres. However a significant proportion of consumers are price sensitive.

The share of consumers choosing premium products is not decreasing, but is slightly increasing. It has also been shown that the affordability problems are not present primarily in this segment. In an economic downturn, demand for lower priced products falls more.

So customers stay loyal to premium products?

There is a growing demand for products where there is as little compromise as possible in terms of safety and now sustainability.

I’m glad that you mention this issue. How are you preparing to meet ESG requirements?

We have to meet more and more stringent requirements, but we are positive about it. We see it not as a threat but as an opportunity. The business of the future must be sustainable. We are prepared to be the most progressive player in the industry in this regard, which is a serious challenge.

Continental has always spent a lot on R&D, and now ESG must be added too?

The two sets of criteria cannot be separated, it is not a conflict of objectives. One of the elements of quality is how sustainable a product is.

Can you give us a specific example?

We came out with a new product last year, called UltraContact NXT. After some previous recognitions the jury of the German Design Council has just awarded the UltraContact NXT with the German Innovation Award in the category “Excellence in Business to Consumer: Transportation”. With up to 65 percent renewable, recycled and (ISCC Plus mass balance-certified) materials from bio-based, bio-circular and/or circular feedstock the UltraContact NXT is Continental’s most sustainable mass-production tyre to date and this 65% is – according to my knowledge – currently the highest level achieved in the tyre industry in terms of serial production of passenger car tyres. It contains renewable raw materials such as resins from paper and wood waste and silica from rice husk ash. Recycled materials such as rubber and steel from mechanically processed scrap tyres are also used in its production, and the carcass is made of polyester fibres, which Continental reclaims from PET bottles using ContiRe.Tex technology, which would otherwise often end up in incinerators or landfills. We are especially proud of it, because we have not compromised on the performance; we have created a product that has achieved the highest scores on the European tyre label. We aimed for and achieved the ‘A’ category in wet braking, noise and rolling resistance equally. We believe that customers should not be forced to choose between safety and sustainability. We have to make a product that meets all the criteria.

Is it possible to upscale this 65% ? Is 100% achievable in the foreseeable future?

The 65% UltraContact NXT is an innovative flagship product where we have shown what we are capable of, but we have to see that a high level of sustainability comes at a significant cost, which is paid by a minority of users recently. We want to reach a level where our products are made from an average of 40% renewable, recycled and certified sustainable materials by 2030. So there will be – and already are – higher percentages and lower percentages products. The target you mention can be realistically achieved by 2050, for all our products.

In HTA press releases, we regularly state that tyre pressures should be checked at the time of refuelling, but at least once a month. On the other side experience shows that car users do not want to be bothered. They just want to drive. Is a completely maintenance-free tyre a realistic goal?

We are trying to move in that direction, but affordable technology is a limiting factor. The growing demand for all-season tyres is an indication of this need, as you don’t have to change them twice a year. This is not a new trend and their market share is growing rapidly, but they are not without any maintenance, as pressure and tyre condition need to be monitored and replaced periodically on the axles to ensure even load and wear. But they are undeniably a convenient solution for those who accept a certain degree of compromise. Tyres are constantly evolving, with many, many aspects to consider. We try to do our best in all areas. In addition to the three characteristics of the tyre label, we also have to look at other important aspects, so R&D is a rather complex process.

Listening to you, I get the feeling that this is a very exciting industry.

If you spoke to one of our development engineers, that feeling would only be heightened. Car manufacturers also have their own criteria, which are not necessarily the same as the needs of the end user. One of their primary objectives is to reduce emissions, so rolling resistance is of paramount importance to them, while we as tyre manufacturers cannot compromise on safety. We must work in a way that takes into account the expectations of all stakeholders.

What tyres is your car equipped with?

For company cars, only the brand is specified, not the specific type. My tyre of choice is the UltraContact NXT, which – I have no doubt about that fact – is the best product on the market right now.

And what did you put on the family car?

AllSeasonContact 2, which is an all-season tyre. It has achieved first place in Tyre Reviews’ four-season tyre test In May this year. Our one-and-a-half-year-old son’s mother drives him around town on this tyre, and I can rest assured that the AllSeasonContact 2 proved strong in a number of areas, including dry and wet handling, snow grip and low rolling resistance. But it was particularly impressive in the wear category: rolling resistance was reduced by 6% compared to its predecessor, while mileage was increased by 15%, without sacrificing safety. This is a particularly good example of how sustainability and safety can be considered at the same time. I am convinced of these values and I live and decide accordingly to these.

I read in AutoBild, one of the most influential European trade magazines, that there is no need for tyres designed specifically for electric cars. After all, conventional tyres (not developed exclusively for e-cars) can deliver outstanding performance in terms of energy efficiency, even if they are used in vehicles with an electric drive train – at least according to the author. Do you agree with that?

I read this article and I agree wholeheartedly. It was a test in which the Continental PremiumContact 7 won the ‘Green Tyre of the Year’ and ‘Eco Champion’ awards out of eight tyres tested. The jury of the German motoring magazine recognised both the summer tyre’s ‘exemplary’ driving performance and its ‘commitment to a clean environment while respecting all safety regulations’. Beyond UltraContact NXT this proves too that safety and sustainability are compatible.

Increased mileage is for sustainability, but at some point it’s time for a tyre change. When do you do that? Wait until the tread depth goes down to 1.6 mm?

Although 1.6 mm is regarded as the legal limit when tyres need to be replaced with new ones, we know that as the tread depth decreases, so do safety-related performances, such as wet grip. Since safety comes first, I replace my tyres with new ones before they reach this value, usually around 3 mm. Aquaplaning is not fun, but a serious safety risk.