New tire concepts – including electric vehicles, smart tires and sustainability – will drive future growth in global tire sales, now that the market has resurged from the worst of the disruption of the Covid pandemic.
Data from the new Smithers report – The Future of Global Tires to 2026 shows that total sales will reach $264.0 billion in 2021, with a total of 2.35 billion tires produced. This represents a resurgence from a drop of $16.2 billion or 192 million units across 2020. Led by Asia-Pacific and China in particular, a recovery is now underway, even as many tire manufacturers and auto OEMs reorient their corporate strategies to the future.
Smithers forecasts the global market will now exceed its 2019 level in 2022. Future growth will continue at a compound annual growth rate (CAGR) of 4.3% (by value) through to 2026; pushing global value to $325.6 billion (at constant prices) and volume to 2.80 billion tires.
Growth will be strongest in the specialty tire segment, where there is also a strong outlook for two-wheeler tires, especially in developing markets. In passenger markets there will be increased demand for high-performance tires for passenger cars and light goods vehicles, driven by the growth in sales of crossover utility vehicles (CUVs), sports utility vehicles (SUVs), and pick-up trucks.
Overall tires sales will naturally be heavily dependent on a wider economic recovery. This will see Asia-Pacific increase tire sales at the fastest rate over the Smithers forecast period especially as nations like China return to their programmes of industrialisation and economic expansion; although there will also be strong increases in demand in North America.
Despite a very challenging environment, tire manufacturers – and their suppliers – are faced with multiple opportunities as the sector must transform in response to advances in vehicle technology, mobility, and regulatory policies. These include both iterative improvements to existing technology, such as the need to meet the latest certification demands for fuel efficiency with lower rolling; and capitalising on the transition to new vehicle types and mobility concepts. The latter category includes tire fitments for autonomous and particular electric vehicles, where innovative designs and premium materials can improve key performance characteristics, such as vehicle range.
Simultaneously the evolution of on-tire sensors and integrated software will enable tire OEMs to supply additional services to customers – for example, improving the uptime and maintenance efficiency of commercial fleets.
This market evolution will also be reflected in raw material orders. Smithers forecast that total demand for these will reach a healthy 47.7 million tonnes in 2021. Across the Smithers forecast period growth for materials will lag behind unit volume growth in tire demand, as sustainability and resource efficiency initiatives take effect.
This will also inform the largest shift in raw materials – a wider use of highly dispersing silica in fillers – to meet the demand for lower rolling resistance and superior wear resistance. This will mainly penalize conventional silica sales, while improvements to carbon black means it to will remain a competitive, if cheaper, alternative filler. Similar trends will see a slight decline in the use of natural rubber in tire construction in favour of engineered synthetic elastomers.
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