The global market for off the road (OTR) tyres is estimated to be nearly 3.5 million tonnes in 2015, corresponding to a value of $23 billion, and is expected to show an overall compound annual growth rate (CAGR) of 4.4% to 2020 in volume terms, and 5.0% per year in value terms. The current state and future evolution and composition of the market are based on a number of key end uses in the global economy (mining, construction, agriculture and industrial) as well as regional growth determinants and technological advances in OTR vehicles and their tyres playing a significant role.
“A number of technological trends will present opportunities for both OTR tyre manufacturers and raw material and component suppliers to meet emerging needs in the marketplace. New compounds, materials and integrated value-added technologies – tyre pressure monitoring systems like TPMS – should help OTR tyres become more durable, efficient and long lasting as applications become more demanding,” said Arthur Mayer, author of the report.
“At the same time, new opportunities appear to be opening up to savvy market participants in the areas of sustainability and standardisation, where there has been relatively little activity compared to other tyre industry areas so far.”
There are many dimensions of technological change within the OTR tyre industry. Improvements are constantly being sought with regard to tyre attributes, such as durability (including heat resistance), load, puncture and cut resistance, soil compaction and even reduced rolling resistance, where relevant. With pneumatic tyres, there are radial and bias (or cross-ply) tyres; while in other situations, there may be choices of solid (or foam filled, for example) tyres instead of pneumatic ones, a choice that will become more interesting as new technologies such as the Michelin Tweel and the Mitas PneuTrac come to market. Other less radical innovations will play a role over the next five years, such as the adoption of TPMS and other advanced tyre monitoring and management technologies.
The largest use for OTR tyres is mining and construction, which also includes some larger industrial applications such as ports and handling (where the largest forklift trucks are used). Altogether, this segment will continue to represent well over half of the market in volume terms. Mining and construction growth over the last several years has been restrained by the effects of soft energy and metals prices that have limited mining activity, but the aggregate mining segment (aggregate used in construction) has driven growth in the overall market. Meanwhile, the construction, agriculture and industrial sectors have continued their steady performances in line with overall economic growth.
All regional markets are expected to grow over the next five years, as global economies variously recover, stabilise and resume growth. As with many other tyre markets, the relatively strong economic performance of the emerging and developing economies greatly influences the distribution of growth opportunities. Thanks to its large mining, construction, agricultural and industrial bases, the Asia Pacific region is by far the largest market. It will continue to dominate in terms of growth prospects through 2020, well ahead of the overall global market.
Based on primary research, The Future of Off the Road Tyres provides expert analysis of the key drivers and trends affecting the global off the road tire industry.