Trends in the Global Tire Industry 2011

Newly published, the 279 page Tire Report provides an in-depth market overview and looks at the internal and external forces currently driving this sector.

The report goes on to examine tire labelling, retail and service, key profit opportunities and technologies. Furthermore a region by region analysis is included along with detailed company analysis of all the major industry players.

A stock of 28 in-depth company profiles is also included with this report.

Background to this research

Since our last report in 2008, the world of tires has changed radically. It has moved swiftly from bust to boom. The current picture is of strong demand, shortage of capacity and rising raw materials prices as shortages bite. The recession of 2008-2009 significantly accelerated the steady move in the balance of power in the tire industry to Asia, away from the US and Europe.

What Is A Tire? 5

Big picture 18

Raw materials 24
Globalisation 25
Segments, sectors, and branding 26
Technology 28
Low-cost manufacture 29
China 30
Legislation 30

Internal Drivers and Change 32

Winter tyres 33
Consumer Vehicles 35
Commercial Vehicles 36
Promotion 38

External Drivers 39

Raw Materials 39
Making natural rubber 43
Butadiene is also in short supply 44
Legislation 46
Environmental Issues 48
Diversification 49
OE Relationships 50

Tyre Labelling 52

Japan – labels and experience 53
Europe – Labelling scheme and expectations 54
United States 58
Marketing communications 59
On-line sales 60

Retail and Service 62

Online retailing 65

Key Profit Opportunities 67

Car/Light Truck 67
Winter Tyres 67
Runflat Tyres 73
Truck Tyres 74
Moto Tyres 75
Aircraft Tyres 76
Agricultural 78
Off-Road 79

Technologies 81

Fillers – Starch, Silica, Carbon Black 81
Bio technology 84
Extended Mobility 84
Sensors in the Tyre 88
Compounding Ingredients 89
Reinforcement 90
Steelcord 91
Manufacturing Technology 92
Recycled rubber 93

Industry Response 97

Bridgestone 101
Goodyear 102
Continental 104
Pirelli 106
Yokohama 107
Hankook 108
Apollo 109

Europe 111

Overview 114
Investments 118
Apollo Tyres Ltd. 118
Bridgestone Corp. 118
Dunlop Aircraft Tyres Ltd. 118
Goodyear 118
Hankook Tyre Co. Ltd. 118

North America 120

Overview 120
Investments 124
Group Michelin 124
Bridgestone Corp. 125
Carlisle Tyre & Wheel Co. 125
CGS A.S. / Mitas 125
Cooper Tyre & Rubber Co. 125
Continental AG 125
Goodyear 126
Pirelli 126
Toyo Tyre North America Manufacturing Inc. 126
Tyre tariffs 126
Manufacturing capacity. 128

China 131

Overview 131
New industrial policy 137
Investments 138
Cheng Shin Rubber Co. Ltd. 138
Cooper Tyre & Rubber Co. 138
Double Coin Holdings 138
Good Friend Tyre Co. 139
Goodyear 139
Hankook Tyre Co. Ltd. 139
Group Michelin 140
Pirelli 141
Sumitomo Rubber Industries Ltd. 141
Toyo Tyre & Rubber Co. Ltd. 141
Triangle Group Co. Ltd. 141
Upstream supply industries 142
Tyre makers must meet new rules 142
Waste tyre plan 143
History 143

Russia 145

Economy 145
Russian Tyre Market Structure 148
Russian State steps in as Sibur moves out of tyre building 149
Expansion projects 152
Continental 152
Nizhnekamskshina 152
Michelin 152
Nokian Tyres 152
Yokohama Rubber Co. Ltd. 152
The Replacement Markets 153

Other Asia 155

Korea and the Global Tyre Market 157
Expansions 159
Bridgestone Corp. 159
Danang Rubber JSC 159
Hangzhou Zhongce Rubber, 159
Hankook Tyre Co. Ltd. 159
Nexen Tyre Corp. 160
Toyo Tyre & Rubber Co. Ltd. 160
Yokohama Rubber Co. Ltd. 160

South America 161

Economy 161
Expansion projects 165
Continental 165
Pirelli & C. S.p.A. 165
FATE S.a.r.l. 165
Sumitomo Rubber Industries 165
Market conditions 165

India 168

Investments listed by company 173
Apollo Tyres Ltd 173
Balkrishna Industries (BKT) 173
Bridgestone 173
JK Tyre & Industries Ltd. 173
Michelin 173
Road building 174

List of Tables and Figures

Figure 1: Global Tire sales since 1990 18
Figure 2: Global Tire production – 2010 compared with 2015 19
Figure 3: LV and MHCV Tire forecasts 19
Figure 4: 2010 Light vehicles and truck sale shares by region and channel 20
Figure 5: World market tire growth out to 2015 (in USD billion) 21
Figure 6: EU truck tyre sales – ETRMA 2003-2010 22
Figure 7: Advanced v. Emerging market tire sales to 2019 23
Figure 8: Butadiene Demand to 2014 25
Figure 9: MS Tire Input Price Index 40
Figure 10: Chart of price trend in Sicom prices for last 3,650 days (10 years) Price in US cents / kg 41
Figure 11: Chart of price trend in Sicom prices for last 1,180 days (Price in US cents / kg) 42
Figure 12: Global Natural Rubber Scenarios to 2019 43
Figure 13: Natural Rubber Recovery 43
Figure 14: Butadiene monomer prices 44
Figure 15: Olefin Cracker Yields, (MT for MT of Feedstock) 45
Figure 16: HD Silica, bifunctional silane vs. standard Carbon Black 48
Figure 17: Japanese tire marking labels 53
Figure 18: European tire marking labels 54
Figure 19: Tyre performance compared to EU regulations 56
Figure 20: European tire marking labels 58
Figure 21: High demand for mobility services 63
Figure 22: For Fleets, reliable tires are important 63
Figure 23: Braking distances in wet, snowy and icy conditions on winter tires compared with standard 68
Figure 24: Mandatory requirements of winter tires in European countries 69
Figure 25: Winter tire market penetration in the Netherlands 71
Figure 26: Regional Demand: Carbon Black v. Highly Dispersable Silica in Passenger Tires 82
Figure 27: Truck Tire Sales in Europe to 2003–2010 111
Figure 28: Passenger Car Tire Sales in Europe 2003–2010 111
Figure 29: OE light vehicle tyre growth in Europe 111
Figure 30: Replacement light vehicle tyre growth in Europe 112
Figure 31: OE Truck Tire Growth in Europe 112
Figure 32: Replacement Truck Tire growth in Europe 112
Figure 33: EU Passenger Tire Replacement Volumes (in millions) 113
Figure 34: EU Truck Tire Replacement Volumes (in millions) 113
Figure 35: Manufacturer Market Share in European Passenger Tires 113
Figure 36: Manufacturer Market Share in European Truck Tires 114
Figure 37: EU Tire imports – 200 compared with 2009 115
Figure 38: EU-27 Tire exports by region in 2009 115
Figure 39: EU trade of Tires in units 116
Figure 40: Tire producing plants in the European Union 119
Figure 41: US and Canadian Tire shipments in millions 2005–2011 120
Figure 42:North American Tires sales 2009 and 2010 (in millions of USD) 121
Figure 43: North American Market Share 121
Figure 44: US Passenger Car Replacement Volumes (in millions) 122
Figure 45: US Truck Replacement Volumes (in millions) 122
Figure 46: Consumer market share of manufacturer brands 123
Figure 47: U.S. Replacement market brand shares 123
Figure 48: North American Passenger Tires market share 2002–2010 124
Figure 49: North American Truck Tires market share 2002–2010 124
Figure 50: Imports into U.S. market 127
Figure 51: Effect of import duties on tire imports 128
Figure 52: Number of tyre factories – the shift to the East 129
Figure 53: Daily Tire production by state/province 129
Figure 54: OE Passenger Tire L-T Tire Market 130
Figure 55: Rising Rubber Consumption in China 131
Figure 56: Mix of Chinese tire imports into U.S. and EU 132
Figure 57: OE light vehicle tire growth in China 133
Figure 58: Replacement light-vehicle tire growth in China 133
Figure 59: OE Truck tire growth in China 133
Figure 60: Replacement Truck tire growth in China 134
Figure 61: Chinese capacity versus output 2001-2008 136
Figure 62: Russia’s GDP growth 145
Figure 63 – Asian Tyre Market 157

Table 1: Share of world tire production by geographic region in 2008 19
Table 2: Tire production by leading manufacturing countries 20
Table 3: Tire Manufacturers profitability in 2010 21
Table 4: The number of major international auto car tyres Commodity Trends (2010) (Unit:%) 64
Table 5: European Car Sales (Units in Thousands) 117
Table 6: Plant Capacities of North America 130
Table 7: Number of factories in N America (mid 2010) 130
Table 8: Tyre production by leading manufacturing countries (units 106) 132
Table 9: Top domestic Chinese tyre makers 134
Table 10: Chinese Tire sales against capacity 135
Table 11: Russian Tyre Plant Data 153
Table 12 - World Leaders in New Tyre Sales (US$bn) 158
Table 13: Major Tire Projects completed or scheduled for completion during 2010–2013 172