The global automotive tire market is a billion-dollar industry that offers opportunities to many involved and interested in it. It was valued at $112.16 billion in 2019, and projections indicate that it will increase through the next seven years. One of the major contributors to that growth continuity is the developing Asian region.
Although the pandemic did slow down sales last year, the Asia tire market is forecasted to bounce back and grow on an average of 3.6% until 2025. Current trends, including the ongoing industrialization and economic expansion in the region, serve as the catalysts for tire sales opportunities. These factors lead to more people earning more and being able to afford buying vehicles, which means good news for the tire replacement market.
A healthy global market, positive forecasts, and an upward income trend are fueling the region’s tire market. Not to mention, they also have a highly diverse tire market, ranging from small to large vehicles. Explore all of these in further detail with these research-based insights into the future of the Asia tire market.
Growth Rate by Type or Volume
High-performance passenger cars and light vehicles used to transport goods are the largest in volume and value, particularly specialty tires. As a result, passenger car tires and light goods vehicle tires dominate the current market in terms of type, driven by increased sales of CUVs, SUVs, and pick-up trucks. However, general tires will continue to make up the majority of the entire market by 2025.
On the other hand, aircraft tires, OTR tires, and specialty tires are forecasted to experience significant growth within the same timeframe. However, the highest growth rate forecast belongs to premium motorcycle tires, both in value and volume, with an annual growth rate of 6.8% and 6%, respectively. In addition, other specialty tires like premium motorcycle tires will also sell more by 2025.
Expectations in Tire Manufacturing and Technology
Aside from sales numbers, you can also expect tire manufacturers to switch some things up and meet certain expectations. This includes the ones in one of the region’s largest markets, China. Their government is zeroing in on reducing carbon dioxide (CO2) emissions, which involves modifications in tire manufacturing methods.
Tire technology in China will be focusing on developing low rolling resistance tires because of the country’s initiative to reduce CO2 emissions. In addition, research and development will also increase focus on adapting tires for electric and autonomous vehicles (EVs and AVs). Because of this, questions are being raised about whether AV tires will be different from conventional vehicle tires and how much.
Growth of EVs and Transportation Technology
China, Japan, and South Korea are expected to invest in electric vehicles for transportation. This expectation will have significant effects on the Asia tire market. China and India are expected to dominate the electric bus market in size in the next five years.
In the meantime, the truck market is expected to be the slowest to adopt electric propulsion because they require a long-range and large investment since they’re commonly purchased as an entire fleet.
Asia is also the largest EV region for two and three-wheelers because of the rapid urbanization and household income increases. This will lead consumers to replace fuel-driven vehicles with electricity-driven ones, ultimately dictating the demand for tires suited for EVs.
The future of the Asia tire market will favor general and specialty tires, with an incoming push towards electric vehicles to take care of our environment. These are what you can expect to see in the next five years around the region. One of the largest tire markets in the world will continue to progress amidst the development and change in society.