Growing economy coupled with increasing per capita income and favorable government initiatives to drive the tyre market in South Africa over the next five years
April 4, 2014 (Newswire.com) - The South African tyre market is the fastest growing tyre market in Africa. The continuous growth in the per capita income has resulted in increasing the domestic sales of automobiles, and the introduction of Automotive Production and Development Program (APDP) in 2013 by the South African government is expected to significantly augment the domestic automobile production over the next few years. South Africa also has many trade agreements with various countries across the globe, which has enabled the country to become one of the preferred export destinations, globally. Major automobile manufacturers such as Toyota, Volkswagen, Nissan, Renault, General Motors, Mercedes Benz, BMW, Ford, Fiat, Iveco, Isuzu, MAN, Volvo and Scania have already established their manufacturing or assembly plants in the country.
According to the recently published report by TechSci Research, "South Africa Tyre Market Forecast & Opportunities 2019", the tyre market in South Africa is projected to grow at a CAGR of around 9%, in revenue terms, during 2014-19, due to continuous expansion in production capacity and increasing investments in the automotive sector.
The report indicates that Goodyear, Apollo, Continental and Bridgestone are the major tyre manufacturers in the South African tyre market, accounting for over 50% cumulative share of the country's overall tyre sales. On the contrary, Michelin, Pirelli, Kumho and Yokohama, etc., are also setting up their businesses and broadening their respective product portfolios to capitalize on the growing tyre demand in the country through imports from their overseas manufacturing units. However, tyre imports from China continue to pose a huge challenge for domestic as well as international players in South Africa due to comparatively low selling price of Chinese tyres.
"The commercial vehicle tyre segment is expected to dominate the tyre market in South Africa during the forecast period due to growing mining and construction sectors. Additionally, the South African government's promotional plan for automotive manufacturers is also anticipated to drive automobile production, which would substantially contribute towards increasing the demand for tyres over the next five years", said Mr. Karan Chechi, Research Director with TechSci Research, a research based global management consulting firm. Mr. Chechi further added that sales of passenger cars and commercial vehicles have registered a double digit growth rate in South Africa during the last four years, which has been driving the demand for tyres, particularly in the replacement tyre market segment.
"South Africa Tyre Market Forecast & Opportunities, 2019" has evaluated the future growth potential of the South African tyre industry and provides statistics and information on market structure, exports and future growth of the tyre industry. The report is intended to provide cutting-edge market intelligence and help decision makers to take sound investment evaluation. Besides, the report also identifies and analyzes the emerging trends along with essential drivers, challenges and opportunities for the tyre industry in South Africa.