NOIDA, India—The tire market in India is estimated to grow at a compound annual growth rate of more than 9 percent between 2017-22, according to a new TechSci Research L.L.C. report, "India Tire Market Forecast & Opportunities, 2022."
The major driver for the expanding tire market is the increasing sale of various segment vehicles among citizens, due to the introduction of a wide variety of new vehicle models in the domestic market, as well as growing purchasing power, according to a statement.
With an expanding volume share of more than 50 percent in the India tire market, the two-wheeler tire segment dominated the overall tire industry in the country, followed by the market of passenger car Light Commercial Vehicles, Medium & Heavy Commercial vehicles, three-wheelers and OTR vehicles.
Demand for two-wheeler vehicles is increasing especially among youth, because of features such as higher convenience, designing, comfort, affordability and fuel efficiency.
Factors such as availability of raw materials, a wide consumer base and various untapped opportunities are attracting several medium and heavy commercial vehicle players to set up their manufacturing units in the country. India also exports commercial vehicles across South East Asian, African and other neighboring countries.
As of 2016, India's tire market was dominated mainly in four regions: East, West, North and South. The West region had the highest demand for tires, with a volume share of more than 30 percent during 2016 in the overall market.
"With increasing infrastructure projects in the country, the Indian industry would able to further attract a huge foreign investment from various countries across the different region in coming years, the Indian government plans to make the country a hub for foreign car manufacturers," said Karan Chechi, research director with TechSci Research. "As a result, several automobile companies are investing or planning to invest in the country's automobile industry. The same trend is anticipated to continue over the next five years as well, consequently positively influencing the India tire market during 2017-22."