Tire Material Market size is forecast to reach $77.46 billion by 2025, after growing at a CAGR of 3.57% during 2020-2025. Using hydraulic power brakes and other movement-control technology in cars, high-performance tires are required. In addition, the need for vehicle containment and traction has shifted the emphasis towards black carbon, wire, and synthetic rubber for tire manufacture. The automotive industry has exercised caution when it comes to evaluating the consistency of the products used for tire manufacturing owing to which it will further accelerate the growth of the Tire Material industry in the forecast era.
Type – Segment Analysis
Elastomer is widely used in Tire Material Market. Elastomeric tires through high tech natural rubber tread compounds are engineered to achieve low rolling resistance, high abrasion, and longer wear. The high tensile and tear properties of this tread formulation ensure good efficiency in the toughest applications. The mid-layer cushion of the tire is built to match tire strength and hardness perfectly. This balance is crucial for maintaining “low rolling” resistance while maximizing the efficiency of the shock absorption. The natural rubber tread compound covers the middle layer, reducing sidewall damage. The product for the tire base or heel is formulated with materials lined with strong rubber fiber. Also, elastomer has good building tack, excellent extrudability, and calendar ability, high rate of cure, and storage hardening due to which the demand for tire materials is foreseen to increase over the forecast era.
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Vehicle Type – Segment Analysis
Passenger car held the largest share in Tire Material Market in 2019 and is projected to grow at a CAGR of 4.14% during the forecast period 2020-2025. Tires are primarily built for harsh terrain and heavy loads. The most popular vehicles on the highway are the cars and light-duty trucks used for passenger transport. A tire is primarily built in passenger cars for ride comfort, stability, handling, and wear life as well as appearance and affordability. Tires do have strong mileage scores and give your buck the best bang. All-season tires provide a smooth ride, long-wear, and adequate traction to passenger car even under dry and humid weather. Also, Tires provide a gripping traction surface and serve as a cushion for a moving vehicle’s wheel owing to which it has increasing use in passenger cars and is estimated to boost the tire material market in the forecast period.
Geography- Segment Analysis
Asia Pacific held the largest share with 35% in Tire Material Market in 2019. Changing lifestyles and standard of living have increased the adoption of high-performance tires as well as branded tires, also expected to positively impact the tire materials market in the Asia Pacific region. The increasing number of vehicle owners will push the growth of both OEM as well as aftermarket segments, and boost the tire materials market going forward. According to the International Trade Administration, China is the largest vehicle market in the world, with the Chinese government expecting car production to reach 30 million units by 2020, and 35 million by 2025. Also, according to India Brand Equity Foundation in 2018, India became the fourth largest auto market with sales increasing 8.3% year-on-year to 3.99 million units. It was also the seventh-largest manufacturer of commercial vehicles in 2018.
Drivers –Tire Material Market
Increasing the use of green tires in vehicles
Green tire is made from recycled materials like nylon rubber through a process that does not require an excessive amount of energy. Conventional tires are made of rubber, but tires are now often manufactured from sustainable raw materials such as plasticizers and resins, with growing energy concerns. Such environmentally friendly raw materials are increasingly chosen over traditional products due to advantages such as being lighter than traditional products, which results in a reduction of the vehicle’s total weight. This also needs less fuel and helps lower the resistance to rolling. During the forecast period, the green tires are expected to witness a lucrative growth rate mainly due to advantages such as long-life and retractable tires. Also, the increase in energy costs, strict government regulations, and increased environmental awareness regarding fuel consumption among consumers will lead towards the increase in the use of green tires in vehicles during the forecast period.
Increasing the production of automotive
The rise in the middle-class population and income has led to the growing demand for automotive in recent years. In addition, the company’s growing interest in exploring the rural markets further aided the sector’s growth. According to India Brand Equity Foundation, India is also a popular car exporter with high hopes for export development in the near future. During FY19, automotive exports grew 14.50 percent. It is projected to rise during 2016-2026 at a CAGR of 3.05%. However, multiple initiatives by the Government of India and the major car players on the Indian market are expected to make India a pioneer in the two and four wheels. By enabling consumers to travel long distances for work, shopping, and entertainment, the automotive industry has encouraged the development of a comprehensive road system, enabled the growth of suburbs and shopping centers around major cities, and played a key role in the growth of ancillary industries such as oil and travel.
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Challenges –Tire Material Market
Effect of tires to the environment
The enormous amount of solid waste produced from the tire’s major concern. Old tires contain heavy metals and chemicals that leach when these tires disintegrate into the atmosphere which is known as leaching. The mutagenic and carcinogenic value of some of these chemicals has been recognized. A further danger faced by leaching is the contamination of the soil. The soil around these old tires can be quickly polluted with the environmentally released harmful chemicals. Even groundwater is at risk of getting polluted. Also, if the water in the soil is tainted by these chemicals, the poisoned water will further come into contact with animals and humans and even endanger their lives. In addition, in the case of discarded tires, one of the key issues is an increased fire risk. For fuel production, almost half of the recycled scrap tire is used. However, it may be more difficult to deal with and extinguish fires that are fuelled by tires.
Technology launches, acquisitions, and R&D activities are key strategies adopted by players in the Tire Material Market. In 2019, the market of Tire Material Market has been consolidated by the top five players accounting for xx% of the share. Major players in the Tire Material are Cabot Corporation, JSR Corporation, Thai Carbon Black, Bekaert, Lanxess, Royal Dutch Shell, Orion Engineered Carbons, American Zinc Recycling LLC, Exxon Mobil Corporation, DMACK Tyres among others.
Asia Pacific dominates the tire material market due to its increasing use of vehicles by a rapidly growing population.
The rising trend of ‘green’ tire is gaining traction. Automobile manufacturers are urged to produce tires using environmentally friendly materials and methods. Hence, this factor is expected to play a key role in shaping the global tire materials market during the forecast period.
In terms of air, water, and soil contamination, the used tires have a significant negative effect on the environment which in the immediate future can create hurdles in the market development.
Due to the lockdowns to tackle the Covid-19 outbreak, the automotive industry expects a loss of about 750,000 units in production and $2 billion in revenue in 2020-2021.