The tire market is driven by increase in vehicles production and increasing disposable income of people. The economic growth in the developing countries is resulting into high demand and production of vehicles, which is driving the demand of tires. The production volume for passenger car and light commercial vehicles (LCV) in Asia-Pacific accounted for more than 50% of the global production. The increasing production in the region is complimented by intensifying demand for passenger cars and LCV in the region. The improving economy and standard of living in countries such as China and India have resulted in increased sales volume of automotive. The high automotive production volume in Asia-Pacific has made it an attractive tire market.
Moreover, a growing number of countries are becoming increasingly urbanized. According to the World Urbanization Prospects report, 54% of the global population lived in urban agglomerations in 2014, in comparison to 30% in 1950. This is projected to increase further to 66% by 2050. With an increase in the percentage of urbanization, there is an increase in the number of passenger cars per 1,000 people. This in turn, is expected to boost the growth of the global tire market during the forecast period.
Tire is one of the most important parts of any automobile, as it provide grip to the vehicle, resist abrasion, and carry and transport loads. Product advancement is one of the key strategies executed by the tire manufacturers to sustain in the global market. In order to do so, the leading players in the automotive tire market are investing heavily on a continued basis on research and development activities. Green tires with high durability and energy efficiency are being largely demanded by the consumers and vehicle producers. Therefore, there has been increasing endeavors by tire manufacturers to meet such demands by acquiring advancement in their products. Currently, low rolling resistance and self-inflating tire technologies are turning out to be extremely popular. Such innovations are expected to take the tire market to a new level.
The use of tires are not limited to new vehicles, but can also be used in old vehicles for replacement purpose, which is also a major market for tires. Passenger car is the largest segment of the global tire market in 2015, accounting for more than 55%. On the other hand, two-wheeler and commercial vehicle tire segments collectively contributed over 30% revenue to the global tire market in 2015.
In 2015, Asia-Pacific was globally the largest market for tire, followed by Europe and North America. Asia-Pacific is further expected to lead the tire market during the forecast period, owing to the increase in the sales and production of vehicles. In 2015, China, India and Japan were the major contributors to tire market in the region. The increasing domestic automotive production, especially in countries such as India and China, is expected to boost the growth of the Asia-Pacific tire market. Asia-Pacific accounts for more than 55% of the tire manufacturing plants owing to favorable government policies, easy availability of cheap labor and abundant rubber production. North America is expected to be the second largest tire market during the forecast period owing to increasing customer base and high disposable incomes of people in the region. This has resulted in increased manufacturing activities by local automotive OEMs in the region, which in turn boosts the growth of the tire market. The European countries such as Germany, France, U.K., Russia and Spain contributed with high growth to the European tire market in 2015.
Some of the major competitors in the global tire market include Apollo Tyres Ltd, Michelin Group, Bridgestone Corporation, Continental AG, Goodyear Tire & Rubber Company, Pirelli & C. SpA, Yokohama Rubber Company, Xingyuan Tire Group, JK Tyre & Industries, and Cooper Tire & Rubber Company.