The Indian tyre industry has seen an unprecedented surge on the front of quality, versatility, and expertise to adapt to new changes, improvements, and mold new-age technology as per the prevailing Indian conditions.
All this reflects in the never-before technology progression in the journey of tire manufacturing right from the cotton carcass to performance-packed and highly durable radial tires produced and supplied by the leading tyre brands in India.
Globalization, particularly in the past 3 decades has established a strong connection among the economies of the nations across the globe, and all the leading tyre brands in India are making all-out efforts to follow global strategies not only to beat their competitors around the globe but also strengthen the economy of India.
This post broadly describes an overview of the Indian tyre industry through a concise look at its growth trends while focusing on product quality, production methodologies, growing exports, and acquisition of the new-age technologies as well.
- Currently, around 40 companies are listed as tire manufacturers in India.
- A large part of the industry is organized but bicycle tire manufacturing is predominantly unorganized.
- The tire industry in India is one of the largest consumers of rubber compounds in which the percentage of natural rubber is 80%, and synthetic rubber makes for only 20%.
- The global proportion of natural to synthetic is 70:30.
- The experts consider the industry raw-material intensive that accounts for 70% of the total production cost.
- The ongoing scenario in the overall radialization of passenger vehicles is 95%, light commercial vehicles rest at 12% and heavy vehicles including buses and trucks make for only 3%.
The principal factors that affect the demands for high-quality tires made and supplied by the leading tire manufacturing company in India include:
- The level of overall industrial activities
- Cost and credit availability
- The cost involved in the transportation
- Conditions of road network nationwide
- The volume of production and the quality desired
- Rules and regulations associated with the vehicle loading
- Retreading and exports.
Evolutionary phases witnessed by the tyre manufacturing Industry in India
- Phase – I (1920-35). In this phase, domestic production was zero. All demands used to be met via imports from the leading brands including Dunlop (U.K), Firestone, and Goodyear (USA).
- Phase – II (1936-60). Domestic production by the leading tire brands in India started. The Rubber Company and India Tire were the key players. This was the very phase when the tariff and non-tariff barriers were first imposed in the country.
- Phase – III (1961-74). Top tyre brands in India in this phase started manufacturing tyres making use of foreign technology. New rules and regulations were made for the repatriation of monetary profits of foreign companies as well as the expansion of capacities. Exports obligations were also imposed on the multinational companies to safeguard the local tire brands in India from external competition.
- Phase – IV (1975-91). This was the phase when some leading Indian business conglomerates took entry into the Indian tire manufacturing market in technological collaboration with multinational companies. This was the time when radial tires were introduced in the country by the leading tyre brands in India with substantial growth in tire production and exports as well.
- Phase – V (1992 onwards). This is considered to be the most important and stimulating phase for the Indian tyre manufacturing industry. This was the phase when liberalization was initiated in the external trade and import duties were drastically cut down. In this very phase, various multinational players either started manufacturing tires independently or established significant tie-ups with any leading tire manufacturing company in India with Indian capital. Liberalized imports were also permitted in this very phase.
The current scenario in the Indian tyre manufacturing industry
Currently, almost all the leading tyre brands in India target and market the given below categories:
- Original equipment manufacturers (OEMs)
- Export to foreign countries
- Replacement markets
- Fulfillment of the Central Government supplies
- State transport undertakings, and
- Open retail markets.
The replacement market holds immense significance for all the leading tire brands in India in the tractors, motorcycles, and mopeds category, while the original equipment manufacturers (OEMs) segment occupies significance for passenger vehicles such as cars and jeeps.
The upgrade in technological capabilities
As far as the acquisition and upgrade in technology are concerned, radialization is one of the most notable aspects of the Indian tire manufacturing industry. Radialization also indicates the growing advancement and sophistication in modern road development, new-age engineering of vehicles, as well as the economy in general.
Despite a large number of limitations and restrictions, major tire brands in India have been successful in manufacturing and supplying global quality products signified by the radialization.
The term ‘Radialization’ in the tire manufacturing industry is very closely linked to factors that include road development with new-age technology, retreating capacities, and overload control.
Radialization has not only helped the leading tyre manufacturing company in India to ensure better mileage and improved fuel economy but also a better driving experience.
However, the efforts for radialization made by the tire manufacturers in India have still not taken off as per the expectations due to the following reasons:
- The unsuitability of Indian roads for the bettered plying of radial tires
- Older vehicles with no suitable fitment geometry
- The unwillingness of the buyers to pay the price for radial tires
- Growing costs of the raw material when compared to the availability of that in China, the United States of America, and various European countries.
In the year 2019, the Indian tire manufacturing industry has crossed the volume of 185 million units. Currently, the leading tire brands in India represent the world’s 4th largest tire market after the United States of America, China, and Europe. Radialization of tires is witnessing a whopping growth, particularly in the buses and trucks segment.
As of now, the entire tire manufacturing market in India is concentrated with around 10 leading tire brands that are manufacturing and supplying around 80% of the total tires produced in the country. Looking forward, the experts are of the view that the industry is expected to show a significant upward curve during 2021-2025.