Global Commercial Vehicle Tire Market 2020-2025

June 10, 2020
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GLOBAL COMMERCIAL VEHICLE TIRE MARKET

INTRODUCTION

Major function of tire is to protect rim and provide the tractive force between road surface and the vehicle. The ongoing pandemic has undoubtedly slowed down the market as the production had come to halt in many regions. Since the beginning of April slowly the plants have been partially restarted and the market has started at slow pace.

 

MARKET SEGMENTATION

By Rim Size

  • 15-17
  • 18-20
  • >20

By Tire Position

  • Steer
  • Drive
  • Trailer

By Vehicle Type

  • Light Commercial Vehicles
  • Heavy Commercial Vehicles

By Distribution Channel

  • OEM
  • Aftermarket

By Geography

  • US
  • Europe
  • China
  • India
  • ROW

 

MARKET DYNAMICS

Overall the tire development process has been shortened. The electrification of light trucks has led to changes in the tire manufacturing, as the EVs have quicker start power than the diesel trucks the tires are subjected to wear and necessary changes in production becomes inevitable.

 

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Last mile delivery and e-commerce in different regions will impact positively to the commercial vehicle tire segment. Increase in last mile deliveries will increase the demand for sub 20 inch rim size tires i.e. 16, 17.5 and 19.5 inches tires.

 

BY TIRE POSITION

The steer tire 1 of the 3 segments based on the position of the tires in the truck vehicles is fitted to the front axle. Many steer tires are considered to be all position tires.

The drive tire is mounted on the rear axle of the vehicle. They are mounted in dual wheel configuration. These tires are provided with spied tread for superior traction. Similar to drive tires trailer tires are also mounted in dual wheel configuration. These are expected to withstand heavy loads and have reinforced sidewalls to protect against curbing.

Since the trailer tires are more in number in multi axle vehicle to withstand heavy loads the trailer tires are the occupy larger market share in the segment.

BY DISTRIBUTION CHANNEL

The Aftermarket sales channel outsold OEM market in every region. Average life span of truck and buses based on wear and tear was found to be 3-4 years. The current crisis period has affected the vehicles sales and thus slowdown in the OEM market.

The presence of large number of competitors providing the same performance and range plays an important part in increased sales in aftermarket segment.

 

US COMMERCIAL VEHICLE TIRE MARKET

The increase in tariffs on Chinese imported products in 2019 caused a major turbulence in the market, as more than 3/4th of the market was occupied by China produced goods compared to domestically produced products.

Due to the ongoing COVID-19 pandemic and aftermath is expected to affect the tire market in the region. The original equipment shipment for light truck and truck tire is expected to decrease by more than 30%. Whereas, the replacement shipment is expected to witness small decline by 7%.

 

 

EUROPE COMMERCIAL VEHICLE TIRE MARKET

The OE truck tires market in 2019 saw a dip by 10% compared to 2018. While, the replacement market in the region witnessed a negligible growth in 2019.

In Europe, the increased in the duties on the Chinese imports led to high spike in the imports form ASEAN and South Korea. The imports from ASEAN in the last 2 years grew by 215 % in 2018 and 170% 2019. The South Korean imports in 2018 were witnessed growth by 117% and 7% in 2019.

In 2019 the top countries in the sales of replacement truck and bus tires were found to be Turkey, Germany and Italy completing the top 3.

The below chart shows the sales of truck and bus tires of top5 5 European countries in 2019:

 

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CHINA COMMERCIAL VEHICLE TIRE MARKET

The over the road equipment like earth moving equipments’ tire has witnessed higher demand than the truck tire equipment. China which held 64% share in 2017 in the exports of truck tires to Europe, now holds 16% share as of 2019 and is the 3rd highest exporter to the region.

Sailun Group Co Ltd has planned to double the capacity of radial truck and bus tires at its Liaoning plant. They are planning to reach 6 million units a year by 2022.

Guizhou Tire is setting up 2 new factories in the Guiyang province and the capacity is slated to be 3 million truck tires a year.

 

INDIA COMMERCIAL VEHICLE TIRE MARKET

Year 2019 has witnessed combined 31% increase in LCV, truck and bus tire production in the country.

Import duties on tires in the country is expected to be increased from 15% to 40% after tires were included in products list to undergo basic customs changes in 2020 Budget.

 

MARKET SIZE AND FORECAST

The EU council is adopting new rules of labelling the tires. They are now including more visible information such as fuel efficiency, wet grip and noise, these parameters will help the customers to buy the best tire for the vehicle.

There have been continuous efforts to minimise the pollution and waste caused by the old tires ever year. About 1 billion tyres reach the end of their life every year, to encounter this Michelin has partnered with Swedish start-up Enviro and bought 20% of its stake to recycle the tires to new raw materials using pyrolysis process.  

 

RECENT MARKET TREND

  • Major commercial tire manufacturers such as Yokohama, Bridgestone and others restarted their plants in US by mid April, which was shut down due to the COVID-19 pandemic breakout.
  • In January 2020, JK Tyres launched Jet Xtra XLM tires for LCV segment of vehicles.
  • Cooper Tire & Rubber Co. and Sailun Vietnam Co., Ltd recently completed the production of first batch of truck and bus radial tyres in their JV at Ho Chi Minh City Vietnam.
  • Apollo Tyres has inaugurated its first truck tyre centre in Thailand.
  • In November 2019 Shandong Linglong Tire CO Ltd has started the production of radial truck and bus at its newest factory in Jingmen region.
  • Ralson India is expanding its fleet from 2 and 3 wheeler tire industry to heavy commercial vehicle segment. It is setting up a plant in Indore, Madhya Pradesh.
  • Apollo Tyres has tied up with Al-Jomaih Tyres of Saudi Arabia and primary focus is given to truck and bus radial tyres.
  • In November 2019, Cooper Tires form US, has increased the ownership in its Mexico JV Corporación de Occidente S.A to 100% and the deal is expected to be completed by this year.

 

COMPETITIVE LANDSCAPE

Bridgestone (Japan), Michelin (France) and Goodyear (US) are the top 3 CV tire manufacturers in the world. The Asian tire manufacturers occupy the highest market share China, Japan and India the major contributors. Some of the Asian manufacturers are Yokohama (Japan), MRF (India), Zhongce (China), Sumitomo (Japan) Linglong (China), Hankook (South Korea) and Apollo (India). Some of the European and American manufacturers are Pirelli (Italy), Continental (Germany), Zenises (UK), Cooper Tires (US).

 

COMPANY PROFILE

  1. Pirelli
  2. Bridgestone
  3. Continental
  4. Goodyear Tire and Rubber Company
  5. Michelin
  6. Yokohama
  7. Apollo
  8. MRF Tyres
  9. Hangzhou Zhongce
  10. JK Tyres
  11. Sumitomo
  12. Hankook
  13. Linglong
  14. Weifang Goldshield Tire
  15. Toyo Tire

 

Sl noTopic
1Market Segmentation
2Scope of the report
3Abbreviations
4Research Methodology
5Executive Summary
6Introduction
7Insights from Industry stakeholders
8Cost breakdown of Product by sub-components and average profit margin
9Disruptive innovation in the Industry
10Technology trends in the Industry
11Consumer trends in the industry
12Recent Production Milestones
13Component Manufacturing in US, EU and China
14COVID-19 impact on overall market
15COVID-19 impact on Production of components
16COVID-19 impact on Point of sale
17Market Segmentation, Dynamics and Forecast by Geography, 2020-2025
18Market Segmentation, Dynamics and Forecast by Product Type, 2020-2025
19Market Segmentation, Dynamics and Forecast by Application, 2020-2025
20Market Segmentation, Dynamics and Forecast by End use, 2020-2025
21Product installation rate by OEM, 2020
22Incline/Decline in Average B-2-B selling price in past 5 years
23Competition from substitute products
24Gross margin and average profitability of suppliers
25New product development in past 12 months
26M&A in past 12 months
27Growth strategy of leading players
28Market share of vendors, 2020
29Company Profiles
30Unmet needs and opportunity for new suppliers
31Conclusion
32Appendix

 

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