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Rubber tires on a real vehicle provide cushioning and friction to its wheels; on a Transformers toy, they are usually ornamental shells over the wheels, though they do roll nicely on the table, and on some toys (such as the Powerdashers with their pull-back motors) they serve mechanical purposes. In most cases, they are not actually rubber, but PVC plastic, which has been plasticized to improve its flexibility.
The plasticizers used can break down over time, causing the plastic to become harder. Furthermore, the plastic shrinks as this happens, causing the cracks and splits sometimes seen in those cool rubber-tired toys.