China Tire Market By Vehicle Type (Passenger Car, Commercial Vehicle, Two-Wheeler), By Demand Category (OEM, Replacement), By Tire Construction Type (Radial, Bias), By Region, Competition, Opportunities and Forecast, 2019-2029F

The China Tire market was valued at USD 54.81 Billion in 2023 and is expected to reach USD 102.40 Billion by 2029 with a CAGR of 10.98% during the forecast period. China's tire market is one of the largest globally, driven by robust automotive production and growing vehicle ownership across passenger and commercial segments. The expanding middle class and increasing disposable incomes are fueling demand for passenger cars, directly influencing the tire market's growth. Furthermore, the government's investments in infrastructure projects, such as highways and transportation networks, boost the demand for commercial vehicles and their associated tire needs. A steady rise in electric vehicle (EV) adoption is also contributing significantly, with manufacturers focusing on developing specialized tires tailored for EV performance requirements.

China’s tire market is characterized by its export-driven growth and strong domestic demand, both in replacement and OEM segments. The country’s position as a global manufacturing hub enables the production of high-quality yet cost-effective tires, which appeal to international markets. Domestically, rising EV penetration has created a surge in demand for tires specifically designed for electric vehicles, offering reduced rolling resistance and enhanced durability. The replacement market is thriving due to the increasing number of aging vehicles, while OEM demand continues to grow in tandem with the expansion of China’s automotive production. These dynamics provide a favorable environment for tire manufacturers to capitalize on both domestic consumption and export opportunities.

Despite its growth, the market faces challenges, such as rising raw material costs and stringent environmental regulations that pressure manufacturers to adopt sustainable practices while maintaining affordability. Intense competition among domestic and international brands has created a highly price-sensitive environment, further straining profit margins. Counterfeit and low-quality tires remain a significant concern, impacting brand trust and safety standards. Navigating these challenges requires manufacturers to strike a balance between innovation, sustainability, and cost-efficiency to maintain their competitive edge in a rapidly evolving market landscape.

Market Drivers

Growing Vehicle Ownership

China’s automotive market continues to expand rapidly, fueled by increasing urbanization and a growing middle class. Rising disposable incomes are enabling more households to purchase vehicles, particularly in tier-2 and tier-3 cities. This surge in personal vehicle ownership directly increases demand for OEM tires, as every new vehicle requires a set of high-quality tires. Similarly, commercial vehicle ownership has grown due to expanding industries such as e-commerce, logistics, and construction. Companies require reliable vehicles to meet operational demands, driving consistent growth in the commercial tire segment. This trend is expected to continue as vehicle penetration rates in rural and semi-urban areas rise, further bolstering the tire market.

Electric Vehicle Boom

China leads the global EV market, supported by government incentives, robust charging infrastructure development, and consumer interest in sustainable transportation. EVs have specific tire requirements due to their heavier weight, higher torque, and need for energy efficiency. These requirements have led manufacturers to innovate by developing low-rolling-resistance tires with advanced tread patterns and durable materials. As EV adoption accelerates, companies are focusing on partnerships with automakers and R&D to meet this demand. This trend represents a significant opportunity for growth, as the EV segment not only requires new designs but also generates demand for premium tire solutions. For instance, in 2024, China reached a significant milestone in the electric vehicle sector, with electric and plug-in hybrid vehicles making up 51% of new car sales in July, totaling nearly 900,000 units. This is a dramatic rise from just 7% three years earlier. In contrast, the U.S. saw electric and hybrid vehicle sales account for only 18% of total sales in the first quarter of 2024. Additionally, global electric vehicle sales hit 1.23 million units in March 2024, with China leading at a 27% increase, while the U.S. followed with a 15% rise.

Tire Replacement Market Expansion

As the number of vehicles on Chinese roads continues to rise, so does the need for replacement tires. Regular wear and tear, coupled with greater awareness about tire safety and performance, has led to a thriving replacement market. Consumers are increasingly opting for higher-quality tires to enhance vehicle safety, fuel efficiency, and driving comfort. The trend is particularly strong among urban drivers, who prioritize premium tires for better performance. This growing replacement demand creates opportunities for manufacturers to expand their offerings and capture a larger share of the market.

Download Free Sample Report 

Key Market Challenges

Rising Raw Material Costs

Rubber, steel, and other raw materials essential for tire production have experienced price volatility, driven by supply chain disruptions, geopolitical tensions, and increased global demand. For tire manufacturers, these cost pressures significantly impact profit margins, particularly in a market as price-sensitive as China. While some companies pass these costs onto consumers, fierce competition often limits pricing flexibility. Manufacturers must explore alternative materials and cost-saving production methods to remain competitive while managing these rising expenses.

Intense Market Competition

China’s tire market is highly fragmented, with numerous domestic and international players competing for market share. Local manufacturers benefit from cost advantages, but international brands often lead in terms of technology, quality, and brand reputation. This competition has created a saturated market where price wars are common, putting pressure on profit margins. Smaller manufacturers face the added challenge of differentiating their products and building brand loyalty, while larger companies must continually innovate to maintain their market position.

Environmental Regulations

The Chinese government’s focus on environmental sustainability has introduced stringent regulations targeting tire manufacturing processes. Companies are required to reduce carbon emissions, minimize waste, and adopt eco-friendly practices, which often involve significant upfront investment. Non-compliance can result in fines, operational restrictions, or reputational damage. Balancing these regulatory demands with the need to remain cost-competitive poses a major challenge, particularly for smaller manufacturers with limited resources for technological upgrades.

Key Market Trends

Electric Vehicle Tire Innovations

The rapid growth of China’s EV market has spurred a wave of tire innovations designed to meet the specific needs of electric vehicles. These include tires with lower rolling resistance to extend driving range, reinforced sidewalls to handle heavier vehicle weights, and optimized tread patterns for improved traction and noise reduction. Tire manufacturers are collaborating with automakers to develop custom solutions that enhance overall EV performance. This trend is expected to accelerate as EV adoption continues, making EV-specific tires a critical focus area for the industry. For instance, in 2022, Sumitomo Rubber Industries, Ltd. revealed the introduction of their inaugural tires specifically engineered for electric vehicles (EV) in China, a market currently experiencing significant growth in EV adoption. The newly developed DUNLOP “e. SPORT MAXX” tires for EVs are recognized as some of the most energy-efficient tires produced by the Sumitomo Rubber Group to date.

Sustainable Tire Production

Environmental consciousness is reshaping the tire manufacturing landscape, with companies investing in sustainable practices to reduce their carbon footprint. These include using bio-based and recyclable materials, adopting energy-efficient production methods, and designing tires with longer lifespans. Government incentives and consumer demand for eco-friendly products are driving this shift, encouraging manufacturers to prioritize sustainability without compromising on quality or performance. The trend aligns with broader global efforts toward environmental responsibility, positioning eco-friendly tires as a key growth segment.

Rising Demand for Specialized Tires

China's evolving automotive landscape is driving demand for specialized tires across various segments. The increasing adoption of electric vehicles (EVs) has prompted manufacturers to design tires that cater specifically to their unique needs, such as reduced rolling resistance, noise reduction, and enhanced durability. Simultaneously, the growth of SUVs and luxury vehicles in the passenger segment has led to a surge in demand for high-performance and all-terrain tires. The commercial vehicle sector also requires heavy-duty and long-lasting tires to support expanding logistics and infrastructure activities. This diversification of demand reflects China's dynamic automotive market and the tire industry's need to continually adapt to shifting requirements.

Segmental Insights

Demand Category Insights

The Chinese tire market is segmented into two primary demand categories: original equipment manufacturer (OEM) tires and replacement tires. Each category plays a vital role in meeting the diverse requirements of consumers and industries across the country.

OEM tires cater to the needs of automotive manufacturers and are designed to meet the specific specifications of new vehicles, whether passenger cars, commercial vehicles, or electric vehicles (EVs). These tires are integral to the production of vehicles and are developed through close collaboration between tire manufacturers and automotive companies. Factors such as rolling resistance, durability, and noise reduction are often tailored to enhance the performance and safety of the vehicles they equip. The rise in automotive production, including traditional internal combustion engine vehicles and EVs, ensures a steady demand for OEM tires. In addition, advancements in vehicle technology have prompted the need for more specialized tires, creating opportunities for innovation in this segment.

The replacement tire market, on the other hand, is driven by the natural wear and tear of tires over time, along with the need for repairs or upgrades. Replacement tires are essential for maintaining vehicle safety, performance, and fuel efficiency. Consumers often seek high-quality options that balance durability, cost, and performance, while commercial fleet operators prioritize reliability and long tread life to minimize downtime. The growing awareness of tire safety, combined with increasing vehicle ownership, has made replacement tires a recurring demand. Seasonal variations and diverse driving conditions across China also contribute to this market, as consumers switch between summer, winter, or all-season tires to adapt to weather changes and road types.

Download Free Sample Report

Region Insights

The tire market in China is significantly influenced by regional dynamics, with East China being the most dominant region in 2023. This region, encompassing key provinces such as Jiangsu, Zhejiang, and the metropolitan hub of Shanghai, has established itself as a central hub for the automotive and tire industries. High levels of urbanization, economic development, and infrastructure investment have created an environment that supports robust demand for tires across both original equipment manufacturer (OEM) and replacement segments.

The dominance of East China stems from its high vehicle density, driven by the region’s affluent population and advanced industrial base. The widespread ownership of passenger cars and the growing popularity of electric vehicles (EVs) have contributed to a steady demand for specialized and high-performance tires. Commercial vehicles, essential for supporting the extensive logistics and manufacturing activities in the area, further drive tire consumption. These vehicles require durable and reliable tires to manage the constant movement of goods across domestic and international supply chains.

East China is also characterized by a strong replacement market, as the high number of vehicles on the road necessitates frequent tire changes due to wear and tear. The region’s consumers are increasingly opting for premium and eco-friendly tire options, reflecting heightened awareness of safety, performance, and environmental sustainability. Seasonal demand for tires tailored to varying weather conditions further supports the replacement market’s growth.

The concentration of tire manufacturing facilities in East China reinforces the region’s dominance. Proximity to raw materials, advanced production capabilities, and well-established transportation networks enable manufacturers to efficiently meet the local and export demands. The region’s infrastructure supports seamless distribution, ensuring timely delivery of products to consumers and businesses. East China’s strategic importance in global trade also drives its export-oriented production, with tires from the region reaching markets worldwide.

As a result of these factors, East China remains pivotal to the tire industry in China. Its dynamic economy, substantial consumer base, and focus on innovation create an ecosystem that sustains its leading position in the market. While other regions contribute to the overall tire demand in China, the influence of East China continues to shape the industry’s trajectory.

Recent Developments

• In 2024, Michelin Group plans to enhance production capacity in China to capitalize on growth opportunities, driven by local initiatives for quality and green transformation. The surge in electric vehicle adoption and innovative technologies among Chinese automakers has influenced this decision. Michelin will expand manufacturing in Shanghai and increase passenger car tire production at its Shenyang factory to meet rising market demand.
• In 2024, Continental inaugurated the fourth phase of expansion at its tire manufacturing facility located in Hefei, China. This enhancement of its only tire plant in the nation will enable Continental Tires to increase its annual production capacity to 18 million passenger and light truck tires by the year 2027. Cumulatively, investments in the Hefei production site have now approached nearly one billion USD.
• In 2024, Bridgestone Corporation announced its commitment to strengthening its premium market presence in China as part of its "Rebuild Earning Power" initiative, launched in 2021. Under the upcoming Mid-Term Business Plan (2024-2026), the company will stop producing and selling truck and bus tires in China, exiting the commercial tire sector. This strategy aims to "Reinforce Earning Power" and focus on the premium tire segment for passenger vehicles, where significant growth is anticipated.

Key Market Players

• Zhongce Rubber Group Co., Ltd.
• Giti Tire Pte Ltd.
• Sailun Group Co., Ltd
• Kumho (China) Tire Sales Co., Ltd.
• Triangle Tire Co. Ltd.
• Double Coin Tire Group Ltd
• Cheng Shin Rubber (Xiamen) Ind., Ltd.
• AEOLUS TYRE CO., LTD.
• Prinx Chengshan (Shandong) Tire Co., Ltd.
• Hankook Tire & Technology Co., Ltd.

Report Scope:

In this report, the China Tire Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

·         China Tire Market, By Vehicle Type:

o   Passenger Car

o   Commercial Vehicle

o   Two-Wheeler

·         China Tire Market, By Demand Category:

o   OEM

o   Replacement

·         China Tire Market, By Tire Construction Type:

o   Radial

o   Bias

·         China Tire Market, By Region:

o   East

o   South-Central

o   North

o   South-West

o   North-East

o   North-West

Competitive Landscape

Company Profiles: Detailed analysis of the major companies present in the China Tire Market.

Available Customizations:

China Tire Market report with the given market data, TechSci Research offers customizations according to a company's specific needs. The following customization options are available for the report:

Company Information

• Detailed analysis and profiling of additional market players (up to five).

China Tire Market is an upcoming report to be released soon. If you wish an early delivery of this report or want to confirm the date of release, please contact us at [email protected]