Not true: for one, tyres are part of the drivetrain and they have losses, but these losses

1. Protect you transmission/differential from shock load,
2. Protect your neck from shock load,
3. Allow you to propel your vehicle on the street by transforming torque at your axle to a linear force at the tyre patch.

Tyre losses are consistent/repeatable within a reasonable temperature range, which means that while they lose power, they do so the same way each time. We have tested cars upwards of 700 hp at the tyres and have seen less than +/- 1-hp between pulls. Tyre losses make up part of the "road load" the car sees on the street. "Road Load" is important when testing a car as a "system", because,

a. "Road-Load" represents power lost that cannot be used to accelerate the car. If a dyno cannot replicate realistic load (tires, rolling losses, etc), it cannot be used to simulate road-load (Road testing, 1/4 mile runs, etc.). Total power - Road load = power available to accelerate. If you want to know how "fast" you can be, you need to know what slows your car down as much as you need to know how much power you are able to develop. We give you the ability to measure and understand both.

b. Load effects tuning: If the dyno does not simulate real-world load it cannot be used in the process of creating a fuel map and timing curve for use in the real-world.

c. Tyres and alloys have "inertia", which is part of the vehicle's total drivetrain inertia (flywheel, transmission, driveline, axle, etc). The inertia of the wheels is important as it will have an effect on how well a vehicle pulls, or accelerates. Inertia is another source of load on the vehicle, as power required to accelerate all of the drivetrain components cannot be used to accelerate the vehicle. All sources of load will affect your tune, so it is important to test with the tyres and alloys on the vehicle.