Importance of the Tire Market in China for Global Brands

Currently, the forecast for passenger car tire demand in the US and Europe looks weak. This has a negative impact on both, the Original equipment manufacturer (OEM) and aftermarket segments. Therefore, given the weak scenario in the Western markets, global passenger car tire manufacturers are increasing their focus on the market in China. The aftermarket in China is expected to grow at a rate of 10 percent over the next couple of years. This makes for a very positive comparison in light of the flat growth curve of the aftermarket in the US and the downward curve of the aftermarket in Europe.

To leverage this opportunity, several leading global passenger car tire brands such as Michelin, Goodyear, Bridgestone, Dunlop, Pirelli, Continental, and Hanook are aggressively expanding their manufacturing capabilities as well as their distribution networks in China. In fact, these brands are expected to increase their production of passenger car tires in China by more than ten percent. For example, Bridgestone increased the capacity of its plant in Tianjin in the second half of 2012. Thus, by increasing their production capacities as well as their reach in the market in China, the global players are increasing the competition in this market. This puts a direct pressure on local players such as Chaoyang to preserve their market shares.

TechNavio has been closely tracking this tilt in the axis of the Automotive industry from the West to the East. We cover combustion engine-based vehicles as well as electric and hybrid vehicles in our automotive reports. Besides, we also focus on components for the OEM and Aftermarket segments.

Our reports on the tire market include the following:

Our reports covering various automotive components and modules include the following: