Malaysia Tire Market Booming, But Can Environmental Norms Play Spoilsport?
Growing vehicle sales and production is a source of
comfort for operators in the Malaysia tire market, but will strict
environmental norms prove killjoy? TechSci investigates…
Malaysia tire
market is one of the fastest growing tire markets in the world. Given the large
population, rising living standards and increasing vehicle proliferation, major
tire manufacturers are turning their attention to the country nestled in the Malay
peninsula. TechSci Research experts provide the key takeaways pertaining to the
Malaysia tire market.
Malaysia Tire Market: More Cars = More Tires
Malaysia has
seen an explosive growth in the number of cars that it puts out on the roads
every year. Over the past 10 years, number of new passenger cars and commercial
vehicles being put on the road easily number over half a million.
Since 2010, when
537 thousand cars were put on the road, no year have the Malaysian authorities registered
under 600 thousand vehicles. Only in
2016, the figure was 580 thousand. These statistics betray the immense
potential in Malaysia tire market.
TechSci Research
report “Malaysia Tire Market Forecast
& Opportunities, 2012 – 2022” also states that vehicle production in
Malaysia is surging, from 1.11 million units in 2012 to 1.16 million units in 2016.
Increase in
vehicle production too, will have a significant impact on Malaysia tire market
products. And significant increase in vehicle production will see a proportionate
rise in the number of tires being sold annually in the country.
In addition to
their indigenous automobile companies, such as Proton, Perodua, Naza etc. major
players such as Ford, Nissan, Volvo have also set up shop in the country.
Therefore, Malaysia tire market benefits from both internal sales and the
production of vehicles in this regard.
Sustainability and the Malaysia Tire Market
Over the past
few years, Malaysia has increasingly been targeting a shift towards energy
efficient vehicles to combat the spectre of global warming. This shift
culminated in the NAP 2014 document which places a major focus on the
production of Energy Efficient Vehicles, or EEVs within Malaysia, with the goal
of making Malaysia a regional hub for EEVs and its related technology by 2020.
Such a policy
can have a major impact on Malaysia tire market, though it remains to be seen
whether the impact is for the better or for the worse.
NAP 2014
document states EEVs are not limited to electric vehicles alone, but any
vehicle that meets a set standard of fuel consumption and carbon emission level.
Therefore, there is tangible potential here for Malaysia tire market, if things
pan out as predicted.
A variety of EEV
certified passenger cars are already plying on Malaysian roads; these include
the Honda Civic, Volvo XC90, Renault Zoe, Haval M4 amongst others. Promotion of
these cars through incentives and subsidies by the government will definitely
surge the demand for Malaysia tire market.
However, the
alternate case to be made is that stricter norms would adversely impact car
production and sales, which would further impact the Malaysia tire market in a
negative manner.
Obviously, more
data is needed to see what sort of an effect the institution of stricter
environmental norms would have on the Malaysia tire market, but it is a fact
that for now, the country has to be seen in the light of its potential, which
is immense.
Malaysia Tire Market from a Global Perspective
TechSci Research
report “Global Tire Market Forecast
& Opportunities, 2022” states that there has been a bit of a slowdown
in the global tire market, given that global demand is still somewhat depressed
due to prevalent market conditions. Given the realities of the situation,
manufacturers are assessing the best options available to them, vis a vis market
growth.
The APAC region,
and Malaysia tire market, in particular, has stood to gain from the change in
market strategy. The APAC region is one of the, if not the most densely
populated region in the world, and Malaysia with a population of around 31
million, is a key contributor.
On top of this, assortment
of other factors such as rate of capital investment, increasing skill level, improving
services, cheap labour etc. make APAC region a leading producer of vehicles, in
addition to a fast-growing consumer.
[Read more news:
https://www.techsciresearch.com/news/2687-global-tire-market-to-cross-319-billion-by-2022.html]
There has been a
tremendous amount of hype being built around the untapped potential of India
and the slowly realizing potential of China, and, as the two most populous
countries in the world, the hype is justified to a certain extent. But people
tend to underestimate the value of countries such as Singapore, Vietnam,
Malaysia tire market etc.
TechSci expects
the global tire market to surpass $ 319 billion by 2022 on account of
anticipated rise in vehicle sales and expanding vehicle fleet, especially in APAC,
during the forecast period. The region accounts for more than 60% of the tire
manufacturing plants due to ample rubber production, low labour cost and favourable
government policies.
Global Tire Market: The Way Forward
TechSci Research
article “How Strong is the Chinese
Stranglehold on Global Tire Market?” tries to divine the future of the APAC
hegemony vis a vis the global tire market. World Bank pegged the growth of East
Asia and Pacific region at 6.3% in 2016, well above the global GDP growth rate
of 2.3%. Vietnam and Thailand were singled out for their exceptional
performance by the same report, which doesn’t even factor in the Indian GDP,
third largest in real terms and growing at over 7% consistently.
To request a sample report, please visit: https://www.techsciresearch.com/report/global-tire-market-forecast-opportunities/962.html
Such growth has
to be viewed in the backdrop of an economic pivot to South East Asia region,
which can, as is being seen in Malaysia tire market, provide a sustainable ecosystem
of its own.
Given that the
significance of petrodollars is already in the decline, the global dampening
experienced due to falling energy prices will eventually be factored into the
global economy and energy will adjust to a new, and lower position in the
global economic hierarchy.
Such corrections
are important for markets like the Malaysia tire market. Because, once the
market correction takes place, the automobile sector will witness renewed
growth given the low fuel prices and also a secular decline in select raw
material prices for tires.
It is early
days, but it remains to be seen whether the benefits of low oil prices will be
bigger than the cost of slow growth patterns that low oil prices will
inevitably shift some emerging markets to. Meanwhile, TechSci will continue to
monitor interesting markets, such as the Malaysia tire markets, and see how the
theory about low oil prices being bad for the economy hold up.
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