Published On: October 2022
Deeply treaded tires, often known as off-the-road (OTR) tires, offer excellent grip on rough surfaces like rock, mud, loose dirt, or gravel. Numerous other types of vehicles, such as cranes, wheel loaders, telescopic handlers, tractors, all-terrain vehicles (ATVs), military trucks, special purpose vehicles, etc., frequently have these tires put on them. High heat and rolling resistance, improved durability, improved vehicle performance, maximum stability, easy mobility, and a minor contact patch are all features of OTR tires. As a result, they are widely used in various industries, such as construction, mining, leisure, agriculture, etc.
The increase in mining businesses' need to offer radial off-road tires to assist their mining operations. One of the most significant opportunities that the market can present is this. Some heavy machinery manufacturers' growing desire for larger off-road tires also created a substantial opportunity for the OTR tires market.
The low cost of tires and the high cost of R&D conducted in unorganized marketplaces are the main factors limiting the market growth for road tires.
Over the next five years, all areas are anticipated to increase, with Asia exhibiting the most significant growth. The distribution of growth potential is significantly influenced by the comparatively strong economic performance of emerging and developing economies, as it is with many other tire markets. Over the projected period, emerging and developing economies, particularly those in the Asia-Pacific region, which will quickly approach 50% of the global market, will continue to overtake mature economies in North America and Europe in terms of the proportion of OTR tire product volume.
Many businesses worldwide have stopped operating because of the pandemic's abrupt emergence. Many people lost their jobs because of the lockdown. The economy eventually collapsed because of this. The suspension of shipping and transportation services resulted from supply chain interference. Roughly 35% of the cost of a tire is attributable to the cost of the raw ingredients. The price of synthetic and natural rubbers fluctuates when Brent crude prices rise, or there is a shortage of land for growing natural rubber, which is a significant concern for the sector.
Opportunities are being presented by several technical advances to address new market needs. As applications become more demanding, new compounds, materials, and integrated value-added technologies, including embedded sensors, should help OTR tires become more robust, effective, and long-lasting. In addition, new market prospects in sustainability and standardization, such as passenger and commercial tires, where there has been relatively little activity compared to other tire product groups thus far, appear to be opening to astute market participants.
In India, the construction sector has experienced tremendous growth, increasing infrastructural development operations in several regions. The market for OTR tires is being further stimulated by the rising demand for heavy-duty construction trucks as a result. The Indian government is also making significant investments in constructing numerous commercial facilities around the nation, including highways, electricity supply grids, bridges, dams, etc., increasing demand for OTR tires. Accordingly, the increasing urbanization drives the use of OTR-based cranes, lorries, vehicles, etc. in constructing contemporary housing complexes, corporate offices, educational institutions, retail centers, etc.
Customers that purchase OTR tires expect predictive analytics to assist them in maximizing productivity, not simply tires and related services, as the industry develops. Customers can use predictive analytics to manage tire life cycle costs and forecast demand for a tire program, in addition to tracking tire and rim performance. As a result, their production unit costs decline, increasing their net profitability. Major fleets are shifting away from a purely transactional or product-centric perspective, where they consider a tire's purchase price and toward an assessment of total expenses—making decisions based on data to enhance uptime and boost profitability by using technology and data to analyze product value.
Over the course of the forecast period, it is anticipated that the value of the off-road tire market will rise at a CAGR of 4.92%. The growth of new industries is accelerating along with the demand for industrial goods. A trend toward mechanization in the agricultural sectors may result from increased consumer income and population growth. Consequently, the demand for off-road tires may expand.