Rita McGrath, blogging at Harvard Business Review, provides a short post-mortem on the failure of Michelin’s PAX run-flat tire system, which was discontinued in April 2008 after failing to catch on in the marketplace and prompting several class action lawsuits.
It turned out that to use the flat-run tires, the underbody of the cars had to be redesigned, and cash-squeezed auto makers proved reluctant to make the necessary investment. Also, replacing the tires required special equipment that most mechanic’s shops didn’t have and didn’t invest in. Say you had a flat-run tired and it failed, You’d have to go on a bit of a treasure-hunt to find someone who could replace it. Finally, if you did find a new PAX tire, it could cost upward of $1,200, about twice what customers expected to pay for a performance product.
Rita McGrath has written before on PAX, including this 2008 piece that includes many of the same points.
Earlier thoughts on the failure of PAX can be found here.
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