The global automotive tire market registered revenue of $155.3 billion in 2018, which is expected to reach $237.2 billion by 2024, growing with a CAGR of 7.7% during 2019–2024. In terms of vehicles, the passenger cars category held the largest share in the market during the historical period.
However, the fastest growth in the automotive tire market is projected to be observed by the medium & heavy commercial vehicles category, during the forecast period. This is attributed to the rising demand for these vehicles in the manufacturing industries across the world. For instance, as per the American Trucking Associations (ATA), the U.S. truck transportation volume grew by 4.2% in 2018, owing to the rebound of the manufacturing industry, along with rising economy, in the U.S.
The growing demand for next-generation, high performance tires is a popular trend being witnessed in the automotive tire market, across the world. The mainstream adoption of these tires is encouraging tire makers across the world to invest in new technologies for the development of ultra-high-performance tires to increase the speed and overall performance of the tires. Many manufacturers are developing these tires by employing patented technologies, specialized silica compounds and polymers, and unique tread designs to meet changing consumer demands and achieve desired performance. Moreover, with the increasing demand for automotive tires, various tire manufacturers are producing high-performance tires with season driving abilities, rider comfort, and less tread wear. Thus, the introduction for next-generation, high-performance tires is one of the key trends being seen in the market.
Due to enormous technological developments in the recent past, the usual lifecycle of the vehicles had significantly increased from 10.5 years in 2010 to 12 years in 2018. Different factors, such as rising competition among automobile manufacturers and increasing government regulations, have resulted in the development of vehicles’ durability and dependability over the years. Moreover, in recent years, it is seen that customers are buying additional units of small crossover vehicles and are also possessing their older vehicles for longer span than before. This changing consumer behavior is predicted to further increase the number of tire replacements required within a vehicle’s lifespan. Further, with the more mileage being provided by vehicles, the probabilities of depreciation of tires have amplified significantly, which cause the need for replacing the tires more often. Thus, the rising overall life of the vehicles is driving the growth of the automotive tire market.
Rising Popularity of Next-Generation, High Performance Tires is an Existing Trend Witnessed in the Market
Improved Lifespan of Vehicles is Propelling the Growth of the Market
Geographically, APAC is expected to continue being the largest market for automotive tires in the coming years. The region comprised over 55% volume share of the market in 2018. The market in the region is primarily driven by increasing automobile production, rising gross domestic product (GDP), and increasing disposable income of people in emerging economies, such as China and India. Further, the North American market is also growing rapidly on account of the growing number of heavy investments (domestic and international) by several manufacturers in recent years.
Competitive Landscape of Automotive Tire Market
The global automotive tire market was consolidated in nature, with four major players holding around 45% of the tire sales, globally, in 2018. The market was led by Compagnie Générale des Établissements Michelin, which was followed Bridgestone Corporation, The Goodyear Tire & Rubber Company, and Continental AG. The dominance of Compagnie Générale des Établissements Michelin in the world is mainly due to heavy investments by the company, as well as the growing presence of large dealer network across the globe.
