Nexen Tire's weak product mix widens profit gap with Hankook, Kumho

Nexen Tire's weaker product mix is causing its profitability to fall further behind its rivals Hankook Tire and Kumho Tire, according to recent data and industry insights. The South Korean tire manufacturer was the only one among the nation's three major tire producers to experience a drop in operating profit during the April-June quarter compared to the previous year.

In contrast, Hankook Tire saw its operating profit surge by 58 percent, while Kumho Tire reported a 24 percent increase. Industry experts attribute the widening profitability gap to differences in product mix among the companies. The industry's shift towards larger tires, driven by the growing popularity of SUVs and large vehicles, is a key factor in this trend.

Automakers are increasingly incorporating larger wheels in their premium models and electric vehicles (EVs), which often require tires that can handle greater weight and higher torque. This demand for high-inch tires, typically referring to tires with greater diameter, provides manufacturers with the opportunity to sell more technologically advanced and valuable products.