New Smithers report outlines global tire industry growth amid market and technology challenges

curata__cOM3OmGHo9yqOto.png

Continuing global economic growth through 2024 is supporting vehicle production, the number of vehicles in use, and the number of tires supplied for these vehicles. A new report from Smithers, The Future of Global Tires to 2024, outlines the factors that are contributing to tire industry growth as well as the evolution taking place with products and services within the industry.

The global tire market is well positioned for further growth as it adapts to meet challenges across a complex matrix of tire type, end-use and regional markets. Estimated at over 2.36 billion units in 2019, topline volume tire growth is expected to continue at a 3.1% compound annual rate from 2019 through 2024, according to Smithers data.

In 2024, total global industry tire volume will reach 2.75 billion units. Value will grow somewhat faster due to a firmer raw material price outlook than in the recent past (and moderated by manufacturing efficiency gains). The 2019 market value of $239 billion will rise to $280 billion in 2024, for a 3.2% compound annual growth rate, Smithers research shows.

The drivers of growth in the global tire industry are best seen in tire types and end uses, grounded by the mature and traditionally technologically-advanced markets (such as the US, Western Europe and Japan), but increasingly dominated by volume and innovation in emerging markets in Asia  ̶  primarily China and India.

Raw materials

The global consumption of raw materials by tire manufacturers is showing continued growth from 2019’s estimated 49.1 billion tonnes. Growth is approximately 2.7% per year, to 55.95 billion tonnes in 2024. Growth of raw materials is slower than tire unit volume due in part to greater efficiency (waste reduction) and efforts to reduce tire weight.

The share composition of materials used is remaining fairly stable through 2024, with exceptions for some of the materials finding greatest use in energy (aka green) tires where low rolling resistance continues to gain in importance, and within categories such as elastomers, where greater sustainability is being pursued (e.g. through reduction in fossil fuel derived ingredients, and in favor of renewables, where possible). 

Growth in tire types

“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, truck and buses and motorcycles, particularly in large but still developing markets (especially China and India). They are still about four-fifths of the market by volume, but this share is steadily declining.

Growing much more rapidly are specialty tires, which include high-performance (aka speed-rated) and premium versions of tires for the major ground/over-road end uses, as well as more specialized types such as energy (aka green, or low rolling resistance, LRR) tires, run-flats, and winter tires.

Specialty tires by this definition are the area in which the leading mass market innovations are occurring, primarily in low rolling resistance tires, and higher-performance tires for larger, more powerful vehicles (such as SUVs, sports cars, electric vehicles). Volume growth is expected to average an impressive 6.6% per year from 2019 to 2024. The smaller segment (in volume, though more important in value terms) OTR (off-the-road) tires are also growing at an above-average rate. However, corresponding more exactly to specific end uses, we consider their prospects more in that context than by type.

Tire market by type, 2024, by volume (% share)

 

End-use markets

The segmentation of the global tire market by end use provides the most straightforward way of understanding the drivers of tire demand. Here, the high-performance, specialty type effect is submerged, but we can see the individual drivers at the application level. The passenger car and light truck share remains dominant, but the faster growth can be seen in motorcycle and OTR tires.

Declining to 68% of market volume in 2024, the passenger car and light truck segment is characterized by:

  • Strong pressures to meet OEM fuel economy regulations and consumer labeling
  • Further uptake of low rolling resistance tires
  • Continuing popularity of high-performance tires
  • Beginning of adaptation to electric (and to some degree, autonomous) vehicle requirements 

To learn more about The Future of Global Tires to 2024 market report from Smithers, download a brochure at:

https://www.smithers.com/services/market-reports/transportation/global-tire-markets-to-2024

Evolution of all-season and winter tire technologies outlined in new report from Smithers

curata__X6LLvuETDVFiTG5.png

Important trends and technologies in all-season and winter tires are detailed in a market report recently released by Smithers. All-Season vs Winter Tires to 2024: A State-of-the-Art Report (Members of TRAC receive 15 per cent discount on all rubber industry market reports produced by Smithers) assesses the key technologies, materials and market drivers that enable tire performance in these two critical product segments, including regulatory, end-use (passenger cars and light trucks) and regional outlooks. 

In terms of performance, several technologies account for the differences in all-season vs. winter tires, including materials, physical design, noise control technologies, processing, and modeling/simulation.

These technologies are ranked and detailed in the state-of-the-art report.

Region differences

The large temperate climate regions of the US and China make all-season tires a standard for most areas except for the northern most regions. Even in many of those areas, and in parts of southern Canada, all-season tires have a high market share, and season-specific tires are less important. This is in contrast to regulatory requirements in Europe and in severe winter weather provinces in Canada where laws or incentives have led to the market bifurcation between summer tires and winter tires.

The role of fuel economy standards

The most important regulatory driver for all-season tires is the OEM vehicle fuel economy standards. These standards are increasing for vehicle OEMs in the EU, Japan, China and North America. Targets for the EU and Japan in the 2025 time frame are rising to over 60 mpg. Originally, US CAFE standards were scheduled to increase to 54.5 mpg in 2025 for passenger cars and 47 mpg as a fleet average, but the standards have been revised downward to 44 mpg and 47 mpg as a fleet average.

The US vehicle market is moving dramatically toward fewer fuel-efficient SUVs/light trucks, which now make up 55% of light duty vehicle sales, even though the US has fuel economy improvements to make to reach new targets. Because tires contribute directly to vehicle fuel economy, automakers will prioritize low-rolling resistance all-season tires in the US for fuel economy gains. In other regions, higher fuel economy standards will drive toward super low-rolling resistance tires.

Winter tire regulation

Europe leads in winter tire regulation, with Germany’s winter tire mandate leading the way. Other EU countries have their own regulations, but because travel among countries is prolific, most consumers use winter tires. In North America, the US does not have a winter tire regulation, and demand for winter tires is concentrated in the northern states. Only in Quebec, Canada, are strict winter tire requirements mandated.

In Asia, Japan’s winter liability laws have encouraged extensive winter tire adoption, while no regulation exists in China. Winter tires are designated by the Alpine snowflake 3MPSF and M+S designations. Winter tire performance is segmented between Nordic/high snow and ice conditions and more moderate Central European winter conditions.  

All-weather tires

All-weather tires are a new market development gaining interest in Europe; they have also been introduced in North America. They offer winter tire labelling with the Alpine snowflake 3MPSF and year-round performance. Market potential exists to expand the all-weather/four-season tire category in south Central Europe, the northern US, Japan and eventually China.

Climate change

Climate patterns over the past 50 years have shown increasing temperatures. This is especially important for the future of winter tires and, to some extent, all-season tires. Increasing temperatures have been significant in northern climates, such as the northern US, where the average temperature has increased over 5° Fahrenheit, putting more cities in moderate winter vs. severe winter climates. The temperature change has generally led to decreases in snowfall and increases in rain; these trends are projected to accelerate over time.  

The overall long-term trends mean winter tires will need to focus more on wet grip, grip on black ice films, and wet snow performance around freezing instead of heavy and dry snow with thick ice conditions at temperatures significantly below freezing.

A brochure on the All-Season vs Winter Tires to 2024: A State-of-the-Art Report is available at: https://www.smithers.com/services/market-reports/transportation/all-season-vs-winter-tires-to-2024.

Read the source article at Smithers

New tire testing equipment installed at Smithers Ohio facility

New equipment to measure a tire’s footprint, load deflection, and inflation pressure loss rate has been installed at the Smithers Rapra Tire and Wheel Test Center in Ravenna, Ohio, USA.

Custom made, the footprint and load deflection machine is designed to shorten testing lead times and support clients’ evolving data requirements.

Read the source article at Tire Technology International

Smithers Promotes New Project Engineer for Dynamic Mechanical Analysis

curata__IbK1ANoiLEQ3iZL.jpeg

Smithers has announced the promotion of Mike Kelly and the hiring of Jeff Wible to its rubber physical testing laboratory in Akron, Ohio.

Mike Kelly has joined the physical testing team as a project engineer, specializing in dynamic mechanical analysis (DMA) testing and new DMA method development.

Read the source article at Tire Review