As of 2019, the world demand for tires was estimated to rise to 4.1 per cent per year to $3.0 billion. Additionally, in value terms, sales of tires were forecasted to advance 7.0 per cent per annum to $258 billion. (Source: Rubber Journal Asia) . If these indicators are anything to go by, the tire industry is only going to sustainably grow over the coming years. COVID 19 effect in 2020, however, may deter the growth for next two years till the virus effect gradually precipitates and the world economy slowly revives and then open up.
A gamut of Indian tire manufacturers initially focused on passenger & commercial vehicles tires, but off-highway tire (OHT) got the attention of the Indian Tire Manufacturers when more & more open Cast mining opened up to ramp up production of COAL ( third largest deposit in the world), Iron Ore and other minerals in the past few decades. Also, mechanisation of agricultural production in the ’80s kicked up demand for tractor & Tractor/implement tires. OHT segment got the attention of the Indian Industry once BKT focussed on this business starting 2000 and today BKT have ushered into an era where India has emerged as one of the leading manufacturing and consumption hubs of off-highway tires primarily in the agriculture, construction and mining segments, ports, etc providing business avenues for both the domestic as well as the international market. Major factors propelling growth in the market are increased production of Coal & other minerals kick-started demand of equipment and there was a consistent increase in production and sales of off-highway tire vehicles and rising demand for replacement of the same.
The industry has been steadily rising, and the global OTR tire market is forecasted to register a total sale of 86.2 million units of tires by 2025. Adding to the phenomenal growth rate in the past, global OTR tire market is surely exhibit a growth in future in volume terms .The Asia Pacific region alone is predicted to have a volume share of 60% in the global OTR tire market. (2023 Tire Market Outlook by Techsci Research)
The OTR segment, in many ways, is a silent hero that drives these industries and gives them the push they need. They can be broadly classified into Earthmoving and Construction Industrial Tire segments, and they are used in much of the work done by these sectors.
The OTR Tire market comprises of two dominant demand areas which are the ones that drive most of the sales – Bias and Radial tires. While Bias tires contribute to a larger chunk of the current sales, the industry is witnessing a gradual increase in the usage of All Steel Radial tires in Earthmoving/mining segment, particularly where large Dumpers / Loaders are in operation to transfer large volume of ores and continuous operation
Mining is the crux of this sector and heavily dependent on the efficiency of tires to execute its operations. Over the years, the mining sector has experienced increased productivity and operation excellence due to the gradual improvement and development of all Steel Radial tires. Mining firms across the world increasing their usage and dependency on ‘All Steel Radial tires’ for the surface as well as underground mining. All Steel Radial Tires is the only solution to sustain their operations and hence the demand for ASR has been consistently rising.
The infrastructure sector has a huge requirement of Tires for Construction Equipment, Material handling etc. machine. Growing demand for backhoe loaders and hydraulic excavators in India and around the world has pushed demand for this category to a great extent. Furthermore, Road construction segment is an important part of the infrastructure sector, has been growing by leaps and bounds and pushing demand of Industrial construction tires for many of its functions.
In India itself, the infrastructure spending is expected to grow at a rate of 9 per cent over the next five years, which will enhance sales significantly, and heighten the demand for equipment in the construction industry, resulting in a massive leap for the OTR segment.
Another factor likely to give a huge boost to the industry is the Indian government’s plan to enhance and strengthen India’s ports by 2020. Ports rely heavily on OTR tires for material handling and this development will significantly drive the overall OTR sales in India.
The map to the future is a broad one, and the OTR segment can truly help enhance this road, and create its own path, and add huge value to the many intertwined industries. The wave is enabling possibilities way beyond the normal imagination and the future certainly appears exciting for the industry!
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