Global Tire Market to cross over 2700 Million tires by 2026: Actual Market Research

The global tyre market is heavily dependent on mobility solutions and the global automotive market is the main determinant and driver for the global tyre market. Lately, tyre market is usually not a trendsetter but fits and adjusts itself accordingly as a mode of mobility evolves. As cities and infrastructure development, and passenger and commercial vehicles demand increase, the tyre market inevitably gets a strong boost to grow. From 2015 to 2020, the global tyre market grew at a CAGR of 4.08%. As lockdown and social movement restrictions were imposed due to the outbreak of the Covid-19 pandemic, the global tyre market had a sharp fall of roughly 4% in 2020. As many of the major economies reopened by 2021, the market recovered at a swift rate to pre pandemic level

The tyre market is as old as the automotive and vehicle market and has today reached a considerable level of saturation. The industry is highly competitive, as the major global players riding on their long legacies, dominate the market. This offers very little scope for new entrants and unorganized players to thrive in the market. In the medium to long term, the tyre market is expected to get a significant boost as the global automotive industry is gradually shifting towards electric vehicles.

During the study, it was observed that the tyre market is predominantly driven by the replacement tyre market with having a significantly higher share as against OEM tyre demand. However, as the automotive industry is seeing a fundamental shift into an electric vehicle, a fresh demand for a new tyre segment is expected to give a boost to the OEM tyre demand.

The development of radial tyres was the biggest innovation in the tyre market. Over the years the functionality of tyres improved and its demand has increased exponentially. In the year 2015, the bias-ply tyres generated sales worth USD 96 Billion whereas, on the flip side, radial tyres generated sales worth USD 83 Billion the same year. Globally, it has been observed that the radial tyres are majorly driven by the demand created by the passenger car segment and the 2-wheeler tyre segment. Even though radial tyres are constantly evolving to support heavy duty workload, bias-ply continues to be more demanded by the commercial vehicle segment.

The automotive industry globally had a shaky growth in the past few years and was going through various structural changes. From the past few years, the developing economies have changed rapidly. The expanding middle class and deeper penetration of vehicles are driving the tyre market in growing economies such as China, India, Brazil, and Canada. The Chinese and Indian tyre markets also benefit from their population and low production costs. China and India as major tyre markets have some interesting dynamics. Major global tyre companies have shifted their production facilities to China and India to accrue benefits of lower production costs. But they fail to capitalize on the volume prospects in these countries as regional players have a stronghold in these regions. Many Chinese and Indian tyre brands are also currently exporting quality tyre products. Japan, which is another major tyre market in the region, is going through a stagnated growth due to a high level of saturation.

Japan has been one of the major exporters of tyre globally. USA, Germany, and France are some of the most matured tyre markets in the world and are facing market saturation. These companies are also home to some of the major tyre companies who are having a global presence. As these countries have a well-developed automotive market, it is expected that they will also be one of the early adopters of electric vehicles. The growth in electric vehicles in these saturated markets will provide a scope and opportunity for the tyre manufacturers to innovate their products suiting to the specific designs, need, and functionalities of the new vehicles.