Hankook & Co. Business Model Canvas

Hankook Tire solidifies its position through key partnerships in motorsport, notably as the exclusive tire supplier for the ABB FIA Formula E World Championship and the FIA World Rally Championship (WRC) for the 2025-2027 seasons.

These high-profile collaborations act as crucial testing grounds, allowing Hankook to demonstrate and refine its cutting-edge tire technology in demanding competitive environments.

The association with elite racing series significantly elevates Hankook's premium brand image on a global scale, reaching a passionate and influential audience.

This strategic engagement in motorsport underscores Hankook's commitment to innovation and performance, directly impacting its brand perception and market presence.

Hankook & Co. actively cultivates partnerships with leading automakers, a cornerstone of its Original Equipment (OE) strategy. This includes collaborations with premium brands like Mercedes-AMG, BMW, Audi, and Porsche, ensuring its tires are fitted as original equipment on a wide range of vehicles, especially high-performance and electric models.

Furthermore, Hankook Tire is a key player in the burgeoning electric vehicle market, supplying specialized tires like the iON series to major EV manufacturers such as Tesla, BYD, Hyundai, Kia, and Lucid. This strategic alignment with EV pioneers is crucial, given the projected global EV sales reaching an estimated 17 million units in 2024.

In motorsports, Hankook's role as the exclusive tire supplier for the ABB FIA Formula E World Championship and the FIA World Rally Championship (WRC) for the 2025-2027 seasons provides a powerful platform for technological advancement and brand elevation. These high-stakes partnerships underscore Hankook's commitment to performance and innovation.

Beyond direct automotive supply, Hankook engages with research institutions and industry bodies, exemplified by its participation in events like the 'Sustainability in Tires 2024' conference. This commitment to sustainability is further reinforced by its target to reduce Scope 1 and 2 greenhouse gas emissions by 46.2% by 2030, aligning with Science Based Targets initiative (SBTi) goals.

The strategic acquisition of Hanon Systems in January 2025 significantly expands Hankook & Co.'s capabilities into thermal energy management, aiming to create synergies across its tire, battery, and new thermal system businesses to offer comprehensive mobility solutions. This integration is poised to enhance EV performance and battery efficiency.

Hankook & Co. dedicates substantial resources to Research and Development, a cornerstone of its strategy. The company focuses on pioneering advancements in sustainable materials, environmentally conscious manufacturing techniques, and enhanced tire performance to meet evolving market demands. This commitment is evident in their development of specialized products like the iON EV-exclusive tire brand, designed for the unique requirements of electric vehicles.

Furthermore, Hankook & Co.'s R&D efforts are directly aligned with global sustainability goals, actively working to reduce greenhouse gas emissions across its operations. They are also heavily invested in creating products that cater to the future of mobility, anticipating and shaping the needs of emerging transportation technologies.

Hankook & Co.'s key activities encompass the complete lifecycle of tire manufacturing, from advanced R&D to global distribution. They focus on producing a diverse range of tires, with a notable emphasis on high-performance and EV-specific models like the iON brand.

Beyond tires, Hankook & Co. diversifies its portfolio through its affiliate, Hankook AtlasBX, which manufactures automotive batteries, particularly premium AGM types, bolstering their presence in the automotive parts sector.

A critical activity involves managing an extensive global sales and distribution network, actively expanding into emerging mobility services and strengthening digital B2B platforms to ensure product accessibility worldwide.

The company also prioritizes sustainable management and ESG initiatives, driving efforts to reduce environmental impact through programs like 're:move' and setting ambitious carbon emission reduction targets.

Hankook & Co. leverages a robust brand portfolio, featuring prominent tire brands like Hankook and Laufenn, as well as the Hankook AtlasBX battery brand. This diverse offering caters to various market segments.

The company actively cultivates a premium brand image, significantly bolstered by its involvement in motorsport sponsorships and accolades for its commitment to sustainability. This strategic positioning enhances customer appeal and loyalty.

In 2024, Hankook Tire & Technology, a key entity within Hankook & Co., continued to invest in brand building. For instance, their sponsorship of Formula E, a leading all-electric motorsport series, directly aligns with their sustainability initiatives and targets a tech-savvy audience.

This strong brand equity translates into tangible market advantages, allowing Hankook & Co. to command premium pricing and achieve higher customer retention rates compared to competitors with less established brand identities.

Hankook & Co.'s key resources include its extensive global manufacturing footprint, with eight strategically positioned plants, including a significant facility in Tennessee, USA. This infrastructure is complemented by its Technoplex headquarters and advanced R&D centers in South Korea, which are crucial for technological innovation. The company also possesses a substantial portfolio of intellectual property, including patents and proprietary material compounds, particularly for EV and high-performance tires.

Hankook & Co. stands as a benchmark for reliability and technological prowess as an Original Equipment Manufacturer (OEM). The company proudly supplies its advanced tire solutions to roughly 50 prominent automotive brands worldwide, equipping over 280 distinct vehicle models.

This extensive reach underscores Hankook's capacity to meet the exacting quality and performance benchmarks set by leading global car manufacturers. Such consistent delivery fosters deep trust and guarantees a high level of product uniformity across its diverse customer base.

Hankook & Co. offers a robust value proposition through its advanced tire technology, particularly its Ultra Ultra High Performance (UUHP) tires and specialized EV tires like the iON brand, which enhance vehicle stability and efficiency. The company's commitment to sustainability, demonstrated by initiatives like the 're:move' program and a 10% reduction in greenhouse gas emissions intensity by 2024 (compared to 2019), appeals to environmentally conscious consumers.

As a leading Original Equipment Manufacturer (OEM), Hankook supplies tires to approximately 50 global automotive brands, equipping over 280 vehicle models, ensuring widespread adoption and trust. The strategic acquisition of Hanon Systems further diversifies Hankook's offerings, enabling the provision of integrated mobility solutions including batteries and thermal management systems, thereby catering to the evolving demands of the electric and future mobility sectors.

Hankook & Co.'s significant investment in research and development, with a strong focus on smart tire technologies and sustainable materials in 2024, positions it as an industry innovator. This dedication ensures its product pipeline aligns with the advancements in autonomous and connected vehicle technologies, solidifying its leadership in the global mobility market.

Hankook & Co. cultivates strong customer relationships by leveraging high-profile motorsport sponsorships. Events like Formula E and the World Rally Championship (WRC) serve as dynamic platforms to demonstrate tire performance and technological advancements to a worldwide audience. These sponsorships are crucial for building brand prestige and trust among enthusiasts and the general public alike.

Beyond the racetrack, Hankook engages in culture marketing to expand its reach and connect with diverse consumer groups. By integrating mobility with elements of art, fashion, and music, the company creates unique experiences that resonate with younger demographics and broaden brand appeal. For instance, in 2024, Hankook continued its partnership with Formula E, a series committed to sustainability, aligning its brand with forward-thinking cultural movements.

Hankook & Co. maintains strong relationships with major automakers through joint R&D, ensuring it's a top OEM supplier. For the replacement market, it focuses on direct engagement, satisfaction guarantees, and an extensive distribution network to build loyalty and encourage repeat business. In 2023, the OE sector accounted for approximately 37% of Hankook Tire & Technology's sales, highlighting the significance of these manufacturer partnerships.

The company also leverages high-profile motorsport sponsorships, such as Formula E and WRC, to showcase tire performance and build brand prestige globally. Additionally, Hankook engages in culture marketing and digital platforms like 'Hantai e Jia' in China to connect with diverse consumer groups and streamline network efficiency. In 2024, Hankook continued its Formula E partnership, aligning with sustainability initiatives.

Community engagement through social contribution programs, including child traffic safety education and environmental conservation, further enhances Hankook's brand image and fosters goodwill. In 2023, the company invested over ₩5 billion in social welfare and environmental activities, demonstrating a commitment to shared value creation beyond financial performance.

Hankook & Co. leverages its retail and service centers as crucial channels for direct customer engagement and specialized product delivery. These include partnerships with numerous auto repair chains and its own premium auto repair shop, SONIC Dogok, facilitating sales and installation services.

These physical locations are vital for offering hands-on customer interaction, allowing for expert advice and specialized vehicle maintenance. In 2023, Hankook Tire & Technology saw continued investment in its retail network, with a focus on enhancing customer experience and service quality at these touchpoints.

Hankook & Co. utilizes several key channels to reach its diverse customer base. These include direct supply to automotive manufacturers for Original Equipment (OE), a broad aftermarket distribution network, direct-to-consumer retail and service centers, and increasingly, digital B2B platforms and partnerships with new mobility service providers.

The OE channel is critical for high-volume business with carmakers, while the aftermarket ensures widespread consumer access. Digital platforms streamline B2B transactions, and engagement with mobility services positions Hankook for future market shifts.

In 2024, Hankook reported that its OE sales continued to grow, particularly with electric vehicle manufacturers. Their aftermarket business also saw strong performance, bolstered by enhanced distribution in Europe and North America.

Digital adoption is high, with over 85% of B2B partners actively using the 'Hantai e Jia' platform in 2024, leading to a 20% reduction in order processing times.

Commercial vehicle fleets, encompassing trucking companies and bus operators, are a cornerstone customer segment for Hankook & Co.'s tire and battery divisions. These businesses are intensely focused on maximizing operational uptime and minimizing total cost of ownership.

For these fleet operators, Hankook's commercial tires are valued for their robust construction, designed to withstand heavy loads and long-haul mileage, directly impacting fuel efficiency and reducing downtime. In 2023, the global commercial vehicle tire market was valued at approximately $75 billion, with Hankook holding a significant share by focusing on these performance metrics.

Similarly, Hankook's battery solutions for commercial vehicles are chosen for their reliability and longevity, crucial for ensuring consistent vehicle performance and preventing costly service interruptions. Fleet managers actively seek products that offer a strong return on investment through extended service life and reduced maintenance requirements.

Hankook & Co. serves a diverse array of customer segments, from major global automotive manufacturers to individual vehicle owners and commercial fleet operators. Their strategy involves catering to both the original equipment (OE) market, supplying directly to car makers, and the aftermarket, where replacement tires are sold. This dual approach ensures broad market penetration and revenue diversification.

In 2024, Hankook continued to strengthen its relationships with premium and electric vehicle (EV) manufacturers, recognizing the growth potential in these areas. Simultaneously, the company maintained its focus on the replacement tire market, which remains a significant revenue driver. The company's battery division also targets commercial fleets, emphasizing reliability and cost-effectiveness.

Hankook & Co. invests heavily in its global sales networks, encompassing significant expenses for advertising campaigns and brand building initiatives. These efforts are crucial for maintaining and expanding market share. For instance, in 2023, the company continued its robust marketing activities, including strategic motorsport sponsorships, which are a key component of their brand visibility. Optimizing these distribution and marketing expenditures remains a primary focus for enhancing customer reach and competitive positioning.

Hankook & Co.'s cost structure is heavily influenced by its substantial investment in research and development, manufacturing, and its global sales and marketing efforts.

The company's commitment to innovation is reflected in its R&D spending, while manufacturing costs are driven by raw materials, energy, and labor, with significant capital expenditures planned for facility expansions like the $1.6 billion Tennessee plant. These investments aim to boost production capacity and achieve economies of scale.

Administrative and overhead expenses, including general administration and corporate governance, also form a notable portion of its cost base, essential for managing a global enterprise.

Hankook & Co. generates significant revenue through its Battery Sales division, primarily under the Hankook AtlasBX brand. This segment focuses on the production and sale of automotive batteries, with a particular emphasis on premium Absorbent Glass Mat (AGM) batteries, which are crucial for modern vehicles with start-stop technology and higher electrical demands.

This battery segment is a key contributor to the company's diversified income streams, solidifying its presence and reach within the broader automotive parts and components sector. For instance, in 2023, the automotive battery market was valued at approximately $31.9 billion globally, and Hankook AtlasBX aims to capture a substantial share of this growing market, especially in the premium segment.

The sales performance of Hankook AtlasBX is directly tied to global automotive production and replacement markets. The company's strategy involves leveraging technological advancements in battery performance and reliability to drive sales, especially as electric vehicle adoption continues to rise, indirectly increasing demand for advanced battery technologies in hybrid and traditional vehicles alike.

Hankook & Co. generates revenue from both original equipment (OE) tire sales to car manufacturers and the replacement tire market through a vast distribution network. The company is increasingly focusing on higher-margin products, such as large-diameter (18-inch and above) tires and those specifically designed for electric vehicles (EVs), reflecting evolving automotive trends.

The Battery Sales division, operating under the Hankook AtlasBX brand, is another key revenue stream, providing automotive batteries, particularly premium AGM batteries for vehicles with advanced electrical systems. The acquisition of Hanon Systems in early 2025 will add thermal management systems for automobiles as a significant new revenue source, tapping into the growing EV market.