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Automotive Tire Market: Key Insights
- Despite sluggishness in the sales of automotive vehicles in the past, the automotive tire market growth remained buoyant registering a CAGR of 4.2% during the 2012-2016 period.
- The automotive tire market generated a revenue of almost US$ 280 billion in 2018 and is estimated to register a Y-o-Y growth of 5% in 2019 through 2018.
- APEJ is expected to retain the bulk of the automotive market share during the forecast period with the region expected to account for almost 50% of the market revenue share in 2019.
- The Asian Pacific Excluding Japan (APEJ) region is also expected to register the fastest growth in the automotive tire market. Rapid industrialization due to the bolstering manufacturing industry in the region coupled with the emergence of newly developed economies in Philippines, Indonesia, Malaysia, and Thailand is expected to uphold automotive market growth.
What are the Factors Promoting Automotive Tire Market Growth?
- Burgeoning demand for replacement tires is estimated to uphold automotive tire market growth. Vehicle owners especially car owners are seeking to replace conventional tires with high-performance tires offering better durability, safety, and ride comfort. Additionally, the rise of the pervasive trend of experiential traveling is bolstering the demand for tires for off-roading activities.
- Rising environmental concerns coupled with extended governmental support for eco-friendly and sustainable manufacturing is influencing the tire production. Original Equipment Manufacturers (OEM) are funneling investments into research and development of sustainable materials and production procedures.
- Industry 4.0 or the integration of IoT, data analytics, and other forms of automation is helping automotive tire manufacturers to streamline their production processes while strengthening their distribution network. Development of technologies such as 3D printing and additive manufacturing is aiding manufacturers in boosting tire production at lower costs.
- A gradual surge in the demand for electric vehicles around the world is likely to create lucrative opportunities in the automotive tire market. Growing consumer awareness about the environment coupled with an increase in the oil and gas prices is expected to drive the demand for electric vehicles around the world which, in turn, is estimated to contribute significantly to automotive tire market growth.
Automotive Tire Market – Competitive Landscape
- With the traction for sustainability in the automotive tire market on the rise, Continental A.G recently revealed that it had developed a sustainable adhesive for bonding rubber with textile reinforcement material in collaboration with Turkey-based Kordsa Tecnik Tekstil A.S. The German-based tire manufacturers plan to leverage the sustainable adhesive for production of a new line of tires in the foreseeable future.
- Vehicle performance and fuel efficiency are gradually becoming key parameters of vehicle selection. In order to tap into the growing consumer base, Daimler, North America, has decided to equip its Freightliner trucks with Michelin X Line EnergyTM D+ long-haul tires. Daimler plans to enhance the fuel efficiency of its Cascadia Class 8 heavy-duty truck from its previous models launched in 2017.
- Intensifying innovation in the automotive tire market saw another development complementing the concept after Goodyear launched a new aero concept tire. The company claims the tires will pave way for the development of flying cars with the propeller blades installed in the tire providing the mechanism for helping cars to transition from land to air.
- To meet the growing demand for automotive tires Sumitomo Rubber Industries announced it would be doubling its production of truck tires at its production facility in Fazenda, Rio Grande, Brazil. With an investment of $37 million, the company expects production of 1000 truck tires per day at the production plant.
Other leading players operating in the automotive tire market include Bridgestone Corporation, The Yokohama Rubber Co., Ltd., Madras Rubber Factory Limited, Pirelli & C. S.p.A, Apollo Tyres Ltd., and Cheng Shin Rubber Industry Co.
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The multi-layer structure of radial tires consisting of steel chords and steel cable beading impart great strength and durability to the tires which are vital reasons driving the demand for the tires in all vehicle segments. Additionally, the tread of radial tires enable better gripping of surface and substantially reduces rolling resistance which, in turn, provides better safety and contributes substantially to greater fuel efficiency. The assortment of benefits offered by radial tires is being leveraged in the lightweight commercial vehicle (LCV) segment. A significant rise in vehicle rental and sharing services is a key factor propelling LCV sales around the world. Substantial growth in LCV fleets around the world is likely to underpin the growing demand for radial tires.
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