Global tire market forecast to produce over 2.7 billion tires by 2026

Gujarat, India – The global tire market is an allied market to the rapidly shifting automotive market. As vehicles are getting more efficient, infrastructure is getting smoother, the tire market finds itself a suitable pedestal to grow upon. As per the research conducted by Bonafide Research, under the title, Global Tire Market Outlook, 2026, the global tire market is evaluated to be selling more than 2,000 million tires annually as of 2020. The tire market globally is expected to grow to more than 2,700 million tires by the year 2026.

From 2015 to 2020, the global tire market grew at a CAGR of 4.08 percent. As lockdown and social movement restrictions were imposed due to the outbreak of the COVID-19 pandemic, the global tire market had a sharp fall of roughly 4 percent in 2020. As many of the major economies reopened by 2021, the market recovered at a swift rate to pre pandemic level. The tire 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 tire 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 tire market is predominantly driven by the replacement tire market with having a significantly higher share as against OEM tire demand. However, as the automotive industry is seeing a fundamental shift into an electric vehicle, a fresh demand for a new tire segment is expected to give a boost to the OEM tire demand. The development of radial tires was the biggest innovation in the tire market.

Over the years the functionality of tires improved and its demand has increased exponentially. In the year 2015, the bias-ply tires generated sales worth $96 billion whereas, on the flip side, radial tires generated sales worth $83 billion the same year.

Globally, it has been observed that the radial tires global tire (tire) market outlook is majorly driven by the demand created by the passenger car segment and the two-wheeler tire segment. Even though radial tires 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 tire market in growing economies such as China, India, Brazil and Canada.

The Chinese and Indian tire markets also benefit from their population and low production costs. China and India as major tire markets have some interesting dynamics. Major global tire 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 tire brands are also currently exporting quality tire products.

Japan, which is another major tire 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 tire globally. USA, Germany and France are some of the most matured tire markets in the world and are facing market saturation. These companies are also home to some of the major tire 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 tire manufacturers to innovate their products suiting to the specific designs, need and functionalities of the new vehicles.