Political and Legal Forces
Toyo Tires is a rubber tire company based in the United States (“About us,” 2018). However, it is seeking to enter the United Arab Emirates market. However, the unpredictable and at times outright hostile political actions by the far-right policies of the United States may hurt their expansion plans. Recent tariffs on steel could be only the first step in a line of tariffs on other materials. The United States is one of the top countries in tire exports, and it may motivate the government to change its policy about rubber materials to prevent competition in the market (Moore, 2018; USTMA, 2018). On the side of the United Arab Emirates, no significant political forces that could affect Toyo Tires were found.
Economic Forces
Analysis of the tire market shows extremely positive results for Toyo Tires. The market is expected to grow at least until 2021 (Grand View Research, 2018). Despite the possible danger of tariffs affecting trade, the market is predicted to be healthy in almost all of its permutations. From standard consumer tires to specialty variations such as racing sports tires and aviation tires, the industry is projected to grow and stay healthy on a global scale. The projections also apply to the United Arab Emirates as its growing automotive and specialty tire markets continue to grow from year to year. The economic forces overall are likely to have a positive effect on Toyo Tires.
Socio-Cultural Forces and Demographics
The United Arab Emirates has a very diverse and healthy car culture due to a variety of factors. Car ownership ranges from basic consumer cars available to younger people and lower-class families to exceedingly expensive supercars and professional Formula 1 cars owned by the elite ruling classes. This diversity of customers should allow Toyo Tires to either target a specific niche in the market, such as luxury car tires, or spread across multiple demographics. With the emerging millennial generation having fewer funds to afford luxury cars, it may be beneficial to focus on tires designed for cheaper and more available cars to serve this emerging demographic (Anand, 2018).
Technological Forces
From a technological standpoint, some modern solutions may benefit Toyo Tires in the long run. The major advances in tire technologies lie in the lifecycle monitoring field. By installing miniature trackers in the tires, both the company and the owner can track the condition of the tires, without a need to take them off the wheel (Patel, 2018). Advances in tire construction are also projected to have a positive effect on the performance of electric vehicles (Goodyear, 2018). With the increasing focus on electric technologies, this could be a valid path to consider for Toyo Tires’ research and development department.
Ecological Forces
The United Arab Emirates government is becoming increasingly concerned about the physical environment of the country (“Dubai plans,” 2018). To create a sustainable economy, the country is slowly switching to electric cars and green technologies. As it was previously mentioned, the company should consider focusing on tires for electric cars as the market is likely to expand in the coming years, and an early advantage is likely to be beneficial.
Conclusion
The expansion planned by Toyo Tires is likely to be successful if the company considers the results of the plan. The biggest outside threat to marketing is the aggressive and unpredictable policies of the United States government. If the company focuses on the emerging millennial demographic and green energy, it may be very successful.
References
About us. (2018). Web.
Anand, J. S. (2018). The millennial effect: Is the definition of luxury in hospitality changing? Web.
Dubai plans first AI-powered renewable energy digital utility. (2018). Web.
Goodyear. (2018). Goodyear presents new tire technology designed to advance the performance of electric vehicles. Web.
Grand View Research. (2018). Automotive aftermarket worth $486.36 Billion by 2025 | CAGR: 4.2%: Grand View Research, Inc. Web.
Moore, M. (2018). Trump’s tariff proposal divides tire industry, government leaders. Web.
Patel, P. (2018). Printed sensor monitors tire tread in real time. Web.
USTMA. (2018).The U.S. tire manufacturers association sends letter to president opposing proposed steel tariffs. Web.