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OTR Tires Market Overview
OTR Tires Market
size was valued $7.5 billion in 2020 and is estimated to grow at a CAGR of 3.5% during 2021-2026. The growing demand for
mining, agriculture and construction are fueling the OTR Tire market. Additionally,
the rising demand for commercial vehicles and the need for off-the-road tires
for optimal performance including glass transition temperature are
driving the growth of the market. Off the road tires are designed in such a way
that it provides traction on different roads such as mud, sand and others with the
pneumatic trail of styrene
butadiene copolymer. The OTR tires are generally used in the vehicles which
work on construction sites, mud mining and other mining fields, agricultural
field and others. North America is considered as fastest growing region around
the world as North America holds high infrastructure development which is
expected to boost the OTR Tire market in the forecasted period.
Report Coverage
Key Takeaways
- The OTR Tires Market is dominated by North America owing to increase in infrastructure development and advanced technologies which are enhancing the growth of this market in North America.
- Agriculture sector being the most important factor for countries like India, China and other are driving the market, the requirement for agricultural vehicle like tractors are rapidly increasing which in turns boost up the OTR Tires market.
- The significant rise in the mining sector and deployment of the heavy machinery is expected to boost the market growth of OTR Tires.
OTR Tire Market, By Geography, 2020
OTR Tire Market Segment Analysis – By Application
Agriculture segment
held the largest market share in the OTR Tires Market at 30.5% in 2020. The rise in
agricultural activities and increase in revenue of farmers has led to increase
in use of tractors and other agriculture machinery which is driving the OTR
Tire market. The factors such as infrastructure development in developing
countries are expected to have significant growth in forecasted period. Hence
the use of construction and mining vehicles in developing countries are rapidly
increasing which increase the demand for OTR Tires.
OTR Tire Market Segment Analysis – By Type
Green tire is
made from recycled materials like nylon rubber through a process that does not
require an excessive amount of energy. Conventional tires are made of rubber,
but tires are now often manufactured from sustainable raw materials such as
plasticizers and resins, with growing energy concerns. Such environmentally
friendly raw materials are increasingly chosen over traditional products due to
advantages such as being lighter than traditional products, which results in a
reduction of the vehicle's total weight. This also needs less fuel and helps
lower the resistance to rolling. During the forecast period, the green tires
are expected to witness a lucrative growth rate mainly due to advantages such
as long-life and retractable tires. Also, the increase in energy costs, strict
government regulations, and increased environmental awareness regarding fuel
consumption among consumers will lead towards the increase in the use of green
tires in vehicles during the forecast period at 7.5% CAGR.
OTR Tire Market Segment Analysis – By Geography
North America dominates the OTR Tires Market with a highest share at 36.5% followed by Europe and APAC in 2020. In North America, infrastructure development is increasing at a wide scale which is leading to adoption of heavy vehicles which are equipped with OTR Tires for having optimal performance. Moreover, the presence of key players such as Goodyear tires and others in U.S are effectively leading to enhance the growth of the market. Additionally, the global OTR Tires market growth is led by APAC due to high usage of heavy vehicle in agricultural sector and construction sites. These significant factors are expected to increase the requirement of such vehicles equipped with OTR Tires in this region, thus propelling the growth of the OTR Tires market.
OTR Tire Market Drivers
Increase in commercial vehicles
Increasing the production of automotive
The rise in the middle-class population and income has led to
the growing demand for automotive in recent years. In addition, the company's
growing interest in exploring the rural markets further aided the sector's
growth. According to India Brand Equity Foundation, India is also a popular car
exporter with high hopes for export development in the near future. During FY19,
automotive exports grew 14.5% despite declining sales in India and China. It is
projected to rise during 2016-2026 at a CAGR of 3.05% despite Covid-19 impact.
However, multiple initiatives by the Government of India and the major car
players on the Indian market are expected to make India a pioneer in the two
and four wheels. By enabling consumers to travel long distances for work,
shopping, and entertainment, the automotive industry has encouraged the
development of a comprehensive road system, enabled the growth of suburbs and
shopping centers around major cities, and played a key role in the growth of
ancillary industries such as oil and travel.
OTR Tire Market Challenges
High Investment and Availability of Affordable OTR Tires from unorganized market
As the rising price of natural rubber is rapidly
increasing the price factor become a challenge in OTR Tire market. The manufacturing
of OTR Tires requires large quantity of rubbers which is used to manufacture
tires which require heavy capital investment. R&D activity is also one of
the factors which required significant capital investment. The OTR Tire market
is also covered by local unorganized players which offer the OTR Tires in low
prices than the organized player into the market. Thus, the activity performed
by local players is certainly hindering the market growth rate.
OTR Tire Market Landscape
Technology launches,
acquisitions and R&D activities are key strategies adopted by players in
the OTR Tires Market. The market of OTR Tires has been consolidated by the major
players – Michelin, Bridgestone Corporation, Goodyear Tire & Rubber Company,
Pirelli, Goodyear Tire, Alliance Tire Group, Toyo Tire & Rubber Company, Double
Coin Holdings, Yokohama, GRI Tyres, Apollo Tyres Ltd,
Acquisitions/Technology Launches
- In November 2020 Goodyear tires have launched latest RH-4A+ tire for haulage which are optimized for footprint pressure to help provide long hours to removal.
- In August 2020 GRI have launched new OTR Tires called Grip Ex Snow tire which have strong grip and high traction in deep snow, this tire guarantees optimal performance in low temperatures and preserves longer tire life.