Report Overview

Mexico Tire Market- Industry Trends & Forecast Report 2027

Mexico tire market continues to stabilize with the overall market estimated to grow at a CAGR of 6.1% in the forecast period (2021-2027). The high concentration of international tire manufacturers, such as Bridgestone, Continental AG, JK Tornel, etc., and increasing investment towards expanding Mexico’s tire production capacity suggest that the country’s tire industry is in good shape. Furthermore, the Mexico tire market is also projected to benefit from the growing number of vehicles owned and automobile manufacturing activities.

Mexico Tire Market- Overview

A tire is a rubberized ring-like part of the vehicle, designed to support the vehicle's weight, absorb shocks, and provide traction. Natural rubber tires not only protect the wheel rim from external damage, but also improve the tire's cushion flexibility. Tires are made up of tread, jointless cap piles, beads, and other materials such as synthetic rubber, carbon black, and fabric.

As far as Mexico tire market is concerned, it is one of the world's biggest car and light truck producers. The country has a high proportion of trucks and buses. Thus, the high replacement rate of trucks, as well as the popularity of new vehicles, drive a high demand for tires in the country.

Mexico Tire Market Forecast and Trends

Growth Drivers

Growing Tire Production by Tire OEMs

Mexico has manufacturing facilities of six major tire companies, i.e., Cooper Tire & Rubber Co., Pirelli, Bridgestone Americas Inc., Continental AG, JK Tire & Industries Ltd., with a total number of nine production plants. The increasing demand for tires in the domestic market as well as in Latin America and the United States is promoting the tire manufacturers to increase their production capacity. They also deal with replacement tires to minimize their losses in the second-hand market, which is expected to boost market growth during the forecast period.

Increasing Purchasing Power and Private Vehicle Ownership

According to the Mexican Secretariat for Agrarian, Land and Urban Development, there has been an increase of 5.4% in car ownership in Mexico over the past 10 years. Thus, there is considerable scope for growth in the country's demand for automobiles, including private vehicles and passenger cars. Manufacturers intending to set up factories in this area will be able to offer cars at competitive prices, thereby increasing their sales. As the number of automobiles in the region increases, the need for tires will also rise, therefore, propelling the overall market growth.

Restraints

High Cost of Tires and Increasing Penetration of Used Tires

The high cost of tires in Mexico acts as a major restraining factor for the market’s growth. This is due to the limited availability of tires due to the market monopoly held by certain multinational companies. In Mexico, tires are mainly imported from abroad. If tires are imported from Asian countries such as China or Japan, import duties are around 50%. Additionally, poor distribution systems and high shipping costs also affect tire prices. Due to these shortcomings, a significant number of the end-users resort to used tires, which sabotages the growth of the Mexico tire market.

Impact of COVID-19 on Mexico Tire Market

The unprecedented COVID-19 outbreak tremendously halted the growth of Mexico's economy. Low testing rates, especially during the beginning of the pandemic, have likely contributed to the high infection rate in the country. A lack of government intervention and refusal to impose a lockdown led to COVID-19 cases spiking sharply across the country, which led to an 8.5% GDP decline in 2020. Additionally, falling disposable incomes also affected the demand for cars, thereby impeding the growth of the country’s tire market.

Mexico Tire Market - By Design

Based on designs, the Mexico tire market is segmented into radial and bias. The radial tire segment accounted for the largest share in the Mexico tire market in 2020. Auto OEMs and private vehicle owners alike are becoming increasingly reliant on radial tires as they reduce fuel consumption due to their lower rolling resistance. Moreover, the highly volatile fuel prices make radial tires more desirable in Mexico. Additionally, steel belts that are used to construct radial tires offer greater durability and greater puncture resistance for heavy commercial vehicles, which is driving the growth of the segment.

Mexico Tire Market - By End-User

Based on end-users, the Mexico tire market is grouped into OEM (original equipment manufacturer) and replacements. The OEM segment holds the largest market share because of the increasing automotive production in the country. Several leading automobile brands, such as Ford, Chrysler, GM, Volkswagen, Toyota, etc., are establishing their production plants in Mexico to cater to the increasing demand for passenger vehicles. However, the replacement segment is also growing at a high rate because of the increasing private vehicle ownership and the need for periodic maintenance and replacement of tires to ensure maximum safety.

Mexico Tire Market - By Distribution Channel

Based on the distribution channels, the Mexico tire market is segmented into online distributors and offline distributors. The offline distribution segment accounts for the largest market share because of the high number of offline retail and specialty stores for tires that sell a wide range of tires and have partnerships with various brands as their trusted dealers. However, the online distribution segment of Mexico’s tire market is projected to witness the highest CAGR during the forecast period. The emergence of the COVID-19 pandemic triggered the growth of the online sales segment for tires, propelling the overall market growth.

Competitive Landscape

The leading players in the Mexico tire market are Bridgestone Americas Inc., Continental AG, Cooper Tire & Rubber Co., JK Tire & Industries Ltd., Pirelli, Goodyear Mexico, Michelin, Hankook Tire de Mexico, TBC Corporation, BKT Tires, and other prominent players.

The market is highly consolidated among international players and is dominated by six multinational tire corporations. Many prominent tire brands are establishing local production plants to target the unexplored potential of the region. They are also launching a wide range of tire types for various vehicles to expand their end-user base. Furthermore, the adoption of competitive strategies such as partnerships, mergers, acquisitions, joint ventures, etc., is also prominent in this market.

Recent Developments

• In September 2021, Pirelli, a multinational tire manufacturer, announced the approval of USD 36 million investment towards the expansion of annual production capacity to 7.2 million tires in its Silao, Mexico tire plant.

Scope of the Report

By Design

• Radial
• Bias

By Vehicle Type

• Passenger Cars
• Light Commercial Vehicles
• Medium and Heavy Commercial Vehicles
• Two Wheelers
• Three Wheelers
• Off-The-Road (OTR)

By End-User

• OEM
• Replacements

By Distribution Channel

• Online Distributors
• Offline Distributors

1. Research Framework
   1. Research Objective
   2. Product Overview
   3. Key Market Segments
2. Research Methodology
   1. Qualitative Research
   2. Methodology
   3. Regional Split of Primary & Secondary Research
   4. Secondary Research
   5. Primary Research
      1. Breakdown of Primary Research Respondents, By Region
      2. Breakdown of Primary Research Respondents, By Industry Participants
   6. Market Size Estimation
   7. Assumptions for the Study
   8. Market Breakdown & Data Triangulation
3. Executive Summary
4. Industry Insight and Growth Strategy
   1. Value Chain Analysis
   2. DROC Analysis
      1. Market Drivers
         1. Growing Tire Production by Tire OEMs
         2. Increasing Purchasing Power and Private Vehicle Ownership
      2. Market Restraints
         1. High Cost of Tires and Increasing Penetration Of Used Tires
      3. Market Challenges
         1. Negative Impact of the COVID-19 Pandemic
      4. Market Opportunity
         1. Expanding Online Platform for Tire Sales
         2. Increasing Automobile Production
   3. Recent Developments
   4. Porter’s Five Forces Analysis
      1. Bargaining Power of Buyers
      2. Bargaining Power of Suppliers
      3. Intensity of Rivalry
      4. Threat of New Entrants
      5. Threat of Substitutes
5. Mexico Tire Market Overview
   1. Market Size & Forecast by Value, 2017-2027
   2. Market Size and Forecast, By Segment
      1. By Design
         1. Radial
         2. Bias
      2. By Vehicle Type
         1. Passenger Cars
         2. Light Commercial Vehicles
         3. Medium and Heavy Commercial Vehicles
         4. Two Wheelers
         5. Three Wheelers
         6. Off-The-Road (OTR)
      3. By End-User
         1. OEM
         2. Replacements
      4. By Distribution Channel
         1. Online Distributors
         2. Offline Distributors
6. Competitive Landscape
   1. List of Key Players and Their Offerings
   2. Market Share Analysis (2020)
   3. Competitive Benchmarking by Operating Parameters
7. Impact of COVID-19 on Mexico Tire Market
8. Company Profiles (Company Overview, Financial Matrix, Key Product landscape, Key Personnel, Key Competitors, Contact Address, and Strategic Outlook) *
   1. Bridgestone Americas Inc.
   2. Continental AG
   3. Cooper Tire & Rubber Co.
   4. JK Tire & Industries Ltd.
   5. Pirelli
   6. Goodyear Mexico
   7. Michelin
   8. Hankook Tire de Mexico
   9. TBC Corporation
   10. BKT Tires
   11. Other Prominent Players
9. Key Strategic Recommendations

List of Figures

Figure 1: Mexico Tire Market Segmentation

Figure 2: Mexico Tire Market Value Chain Analysis,

Figure 3: Company Market Share Analysis, 2020

Figure 4: Mexico Tire Market Size, By Value (USD Billion), 2017-2027

Figure 5: Mexico Tire Market Share (%), By Design, By Value, 2017-2027

Figure 6: Mexico Tire Market Share (%), By Vehicle Type, By Value, 2017-2027

Figure 7: Mexico Tire Market Share (%), By End-User, By Value, 2017-2027

Figure 8: Mexico Tire Market Share (%), By Distribution Channel, By Value, 2017-2027

List of Tables

Table 1: Mexico Tire Market Size, By Design, By Value, (USD Billion), 2017-2027

Table 2: Mexico Tire Market Size, By Vehicle Type, By Value, (USD Billion), 2017-2027

Table 3: Mexico Tire Market Size, By End-User, By Value, (USD Billion), 2017-2027

Table 4: Mexico Tire Market Size, By Distribution Channel, By Value (USD Billion), 2017-2027

Table 5: Bridgestone Americas Inc. Financial Analysis

Table 6: Bridgestone Americas Inc. Business Overview

Table 7: Continental AG Financial Analysis

Table 8: Continental AG Business Overview

Table 9: Cooper Tire & Rubber Co. Financial Analysis

Table 10: Cooper Tire & Rubber Co. Business Overview

Table 11: JK Tire & Industries Ltd. Financial Analysis

Table 12: JK Tire & Industries Ltd. Business Overview

Table 13: Pirelli Financial Analysis

Table 14: Pirelli Business Overview

Table 15: Goodyear Mexico Financial Analysis

Table 16: Goodyear Mexico Business Overview

Table 17: Michelin Financial Analysis

Table 18: Michelin Business Overview

Table 19: Hankook Tire de Mexico Financial Analysis

Table 20: Hankook Tire de Mexico Business Overview

Table 21: TBC Corporation Financial Analysis

Table 22: TBC Corporation Business Overview

Table 23: BKT Tires Financial Analysis

Table 24: BKT Tires Business Overview