LEATHERHEAD, England — The global tire market is well-positioned for further growth as it adapts to meet challenges across a complex matrix of tire types, end uses and regional markets, according to a new Smithers Rapra study.
"The Future of Global Tires to 2022" estimates the overall market to reach more than 2.2 billion units in 2017 with volume growth expected to continue at a 3.4 percent compound annual rate from 2017 through to 2022.
Smithers Rapra does not specify which tire types the study covers, buty states that the marketi's value will grow somewhat faster due to a firmer raw material price outlook than in the recent past.
Global industry tire volume will approach 2.7 billion units in 2022, Smithers Rapra said, while the market value will rise to $267 billion in 2022 from $223 billion, a 3.7-percent annual compound growth rate,
The drivers of growth are best seen in tire types and end uses, grounded by the mature and traditionally technologically advanced markets (such as the U.S., Western Europe and Japan), but increasingly dominated by volume and innovation in emerging markets in Asia, primarily China. Premium and high performance tire growth in North America and Europe will remain a strong positive influence on growth, the report noted.
Tracking growth of tire market volume, the global consumption of raw materials by tire manufacturers is showing continued growth from 2017's estimated 45.2 billion tons. Growth is estimated at about 3.8 percent per year, to 54.5 billion tons. The share composition of materials used is remaining fairly stable through 2022, with exceptions for some of the materials finding greatest use in energy (or green) tires where low rolling resistance continues to gain in importance.
With rolling resistance reductions increasingly sought by vehicle manufacturers and end users, highly dispersible silica will become an increasingly important raw material, according to the study.
There is still considerable scope for further expansion of highly dispersible silica, which is expected to grow significantly faster than all other raw materials, by almost 10 percent per year through to 2022. Similar growth is occurring in silane coupling agents, where further innovations are being pursued.
The highest growth, Smithers Rapra said, is seen in regions with the most potential for further penetration of low rolling resistance tires, such as Asia Pacific. Growth will be slowest in Europe, where the low rolling resistance technology is most established, but it still will find support as tire labeling and associated regulations come into full effect, according to the study.
Tire type segmentation at the whole industry level corresponds somewhat, but not entirely, to tire end-use application. General tires account for the bulk of passenger (car, light truck, motorcycle) and goods (medium and heavy trucks, buses) transportation. These are relatively undifferentiated, non-speed-rated, lower-tier, mostly replacement tires for the over-the-road mass markets of light vehicles, trucks, buses and motorcycles, particularly in large but still-developing markets, especially China and India. They are still about four-fifths of the market, but this share is steadily declining.
Growing much more rapidly are specialty tires, which include high-performance (or speed-rated) and premium versions of tires for the major ground/over-road end uses, as well as more specialized types such as energy (green or low rolling resistance) tires, run-flats and winter tires.
The very small volume off-the-road and aviation tires also are growing at an above-average rate, Smithers Rapra said.
The segmentation of the global tire market by end-use provides the most straightforward way of understanding the drivers of tire demand, according to the study. The passenger car and light truck share remains dominant, but faster growth can be seen in motorcycles and the three end-uses that comprise OTR types. Declining slightly in market volume in 2022, the passenger car and light truck segment is characterized by strong pressures to meet original equipment manufacturer fuel economy regulations and consumer labeling.
"The Future of Global Tires to 2022" is available at smithersrapra.com for $5,996.