Demand in this market is driven by seasonal wintery road conditions, and low temperatures in northern countries and regions (such as Europe, Russia, and North America).
According to Smithers Rapra’s report – The Future of Winter Tires to 2021 – the winter tire market is dynamic, both in terms of incremental improvements and potential breakthrough concepts. Some research efforts have resulted in new winter tire categories, like all-weather and high-performance winter tires, both of which are expected to gain share over the coming years. Meanwhile studding, long disfavoured and sometimes banned due to road surface damage, is an area of greater attention and promising innovations (such as retractable studs), some of which are now only in the concept phase.
Winter tires are for seasonal wintry road conditions and low temperatures in northern countries and regions, which have translated into demands for greater driving safety from motorists, insurance companies, and (not least) governments at country and state/province levels. Despite the regulatory support, demand is still highly influenced by the severity of winters, making it difficult for manufacturers, distributors and raw material suppliers to plan, and raising the prospects of periodic shortages or excess supply. Given the attractive margins though, and the important seasonal role the tires play, most major players have a significant involvement, subject to regional variations.
Winter tires are important in a number of end-use segments, chief among them passenger cars and light trucks, in geographic markets where weather conditions and regulations may require their use. Worldwide, the winter tire market is dominated by passenger cars, which account for about three-quarters of winter tires sold, or 131 million, compared to almost 44 million for light trucks. Growth between the two segments on a global basis is expected to be balanced through 2021, with each growing at the same rate as the overall market in unit terms.
The winter tire market is overwhelmingly (60%) a European one, particularly Scandinavia, and Central and Eastern Europe. Russia, another “emerging” economy that has stumbled of late, is often included in Europe, but when it comes to winter tires it is large enough for separate treatment. The other markets are North America (mainly Canada and the northern “snowbelt” states of the US), Japan, and China. It is the currently unregulated China market that is most noteworthy for growth, gaining at over 13% per year, compared to 3.3% for the market overall.
The Future of Winter Tires to 2021 report looks at the current market for winter tires and prospects for further growth based on assessments of basic trends and drivers, regulatory, technological, end use (passenger cars and light trucks), and regional outlooks. It looks at demand from a global perspective, including examples from, and forecasts of, all of the significant winter tire-consuming regions.
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