Nigeria Tire Market to be Led by Commercial Vehicles Through 2028
The Nigeria tire market is deriving
its growth from a rise in logistics and construction sectors and the increasing
demand for two-wheelers.
According to
TechSci Research report, “Nigeria Tire Market – By Region, Competition,
Forecast & Opportunities, 2028,” the tire market in Nigeria is expected to surge in the
forecast period due to various factors. Some of the major factors which are leading
to growth in the tire market in Nigeria are rising demand for two-wheelers, and
investments in logistics, construction, and oil and gas sectors. These
industries involve the usage of commercial vehicles, which are directly
dependent upon the tire market.
In Nigeria, the demand for two-wheelers
is rising due to its affordability and easy maneuverability. The prices of vehicles
are surging due to heavy taxes, which is making two-wheelers a better
alternative thus increasing demand for tires in the market. Apart from this,
there have been increasing investments in infrastructure development and
production of oil and gas resources. These sectors demand a range of commercial
vehicles for their operations which again require different types of tires for vehicle
mobility.
Moreover, there is another
facet of tire market demand which is the replacement tire market. It is gaining
pace in the market due to the increase in used cars in Nigeria. Most people in
Nigeria fall under the middle- or lower-income class. Therefore, they are
shifting toward owning used cars instead of new cars. Since used cars require
early replacement of tires because of their faster damage rate, the demand for replacement
is increasing. In addition to this, some local automotive manufacturers are
also entering the market to reduce vehicle prices, which is a further expansion
of the tire market.
In Nigeria, construction
projects are funded by both the government and private sectors because the
government does not have sufficient funds to enhance the infrastructure alone.
Therefore, these projects are funded by public-private partnerships (PPPs),
multilateral development banks (MDBs), bilateral creditors, and many other
entities. The Senate has sanctioned US$ 22 billion in external loans for key
infrastructure projects, among which housing accounts for around 11% and
transportation for around 25%. These developments are increasing the demand for
commercial vehicles which require additional support from other industries,
such as tires, belts, and lights. Therefore, creating more scope for the tire
market in the country.
The oil and gas
industry in Nigeria has always remained lucrative for foreign investors. The
government is offering various incentives to attract FDIs in this industry for
both extraction and production. Various subsectors benefit from the
developments in the oil and gas industry. One of them is the logistics industry,
which is mostly involved in the transportation of fuel and other goods. The
rise in the logistics sector directly creates opportunities for commercial
vehicles and thus the tire market as well.
The tire market
is segmented into various categories. First, they are divided based on the
vehicle types: Passenger cars, light commercial vehicles, medium and heavy-duty
vehicles, two-wheeler, and off-road vehicles. Every type of vehicle has
different requirements for tires based on the vehicle application, such as tire
design, materials, casing, sidewall, and tread patterns.
The tire market
is further segmented based on the demand categories into OEMs and aftermarket
(or replacement market). Tires are either installed freshly manufactured in the
vehicles or are repaired by treading upon them after a considerable amount of
their usage.
Moreover, tires are
constructed by utilizing steel cords within the tire rubbers due to numerous
specifications for different vehicles. So, based on construction type, the
market is divided into radial and bias tires. Based on the tube of tires, it is
divided into tube and tubeless tires. And lastly, based on region, the market
is segmented into North, West, South, and East.
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Key players in
the Nigeria tire market include:
- Michelin Group
- Bridgestone Corporation
- Goodyear Tire and Rubber Company
- Continental AG
- Dunlop Limited
- Maxxis International
- Pirelli & C. S.p.A
- The Yokohama Rubber Co. Ltd.
- Copper Tire & Rubber Company
- Hankook Tire & Technology Group
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“The rising
demand for two-wheelers in the country is going to positively impact the tire
industry. In addition, government initiatives regarding investments in
construction, logistics, and oil and gas companies are going to create
opportunities for the commercial vehicle market, which in turn increases the
demand for tires in Nigeria. Thus, the tire market in Nigeria will see growth
in the years to come,” said
Mr. Karan Chechi, Research Director at TechSci Research, a research-based global
management consulting firm.
Nigeria Tire Market, By Vehicle Type (Passenger Cars, Light Commercial
Vehicles, Medium & Heavy Commercial Vehicles, Two-Wheelers, and Off Road
Vehicles), By Demand Category (OEM, Aftermarket), By Construction Type (Radial,
Bias), By Tube Type (Tube, Tubeless) and By Region, Competition, Forecast &
Opportunities 2028 has evaluated the future growth potential of tire market in Nigeria and provides statistics and
information on market structure, size, share and future growth. The report is
intended to provide cutting-edge market intelligence and help decision makers
take sound investment decisions. Besides, the report also identifies and
analyzes the emerging trends along with essential drivers, challenges, and
opportunities present in the Nigeria Tire Market.
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