Global Layout is Key to Becoming a First-Tier Tire Enterprise, with Innovation and Upgrading Leading Consumption Trends.
(1) Massive Global Tire Market Scale
The global tire market has remained above $150 billion in recent years, reaching $192 billion in 2023. Despite the slowdown in vehicle ownership growth in emerging markets, the global tire market will maintain long-term high-level stability. As a necessary consumable for automobiles, tire demand persists. With the rise of developing countries and the increase in global vehicle ownership, significant growth potential remains in the future market.
(2) Asia, Europe, and North America as Major Global Tire Markets
North America and Europe are traditional tire consumption markets. In recent years, the global tire industry's center has gradually shifted to Asia, primarily because the tire industry is capital-, technology-, and labor-intensive. Asia offers relatively low-cost and high-quality labor resources and has formed a complete tire industry chain. As Asia's economic level and industrial foundation continue to strengthen, its share of tire consumption and production is expected to further increase.
(3) High Market Share of Large Tire Enterprises
International large tire manufacturers hold significant leading advantages due to their strong capital strength, continuous R&D investment, and brand and channel advantages established over years, resulting in high global tire market concentration. In 2023, the "First Group" of the global tire industry—comprising Michelin, Bridgestone, and Goodyear—generated total sales of $70.293 billion, accounting for 36.61% of the market share. The top 10 global tire manufacturers, including Zhongce Rubber, achieved total sales of $118.394 billion, accounting for 61.66% of the market share. Due to the inherent economies of scale in the tire industry, large tire enterprises are expected to maintain high market shares in the future.
2. Chinese Tire Market Overview
(1) Broad Growth Space in China's Tire Market
Driven by factors such as the steady advancement of urbanization and the gradual increase in per capita disposable income, vehicle ownership in China has continuously risen. In 2024, the national motor vehicle ownership reached 453 million, a year-on-year increase of 4.13%. The growing number of motor vehicles has driven rapid growth in tire demand in China.
In the coming years, the market capacity of China's tire industry is expected to continue growing. While vehicle ownership in China is increasing, the penetration rate remains low. Therefore, there is still significant room for growth in vehicle ownership, which will drive the continued expansion of the tire industry's market capacity.
(2) Radial Tires Dominate the Market
Radial tires hold a dominant position in the Chinese market. In 2021, tire production reached 697 million units, of which radial tires accounted for 657 million units, with a radialization rate of 94.5%. According to the Rubber Industry "14th Five-Year Plan" Development Guidelines, by the end of the "14th Five-Year Plan," the tire radialization rate is expected to increase to 96%, the tubeless rate for all-steel tires to 70%, the flattening rate for passenger car tires to 30%, the radialization rate for agricultural tires to approximately 15%, and the radialization rate for giant engineering tires to 100%.
(3) New Opportunities Brought by the Rapid Development of New Energy Vehicles
On November 2, 2020, the State Council issued the New Energy Vehicle Industry Development Plan (2021-2035), aiming for new energy vehicles to account for about 20% of new vehicle sales by 2025 and achieve the commercialization of highly automated driving. By 2023, the market share of new energy vehicles had reached 31.6%. With industry development, domestic tire enterprises can leverage their cost-performance and service advantages to compete with overseas companies, strengthen technological R&D cooperation with new energy vehicle manufacturers, and increase market share.
3. Industry Technical Level and Development Trends
(1) Industry Technical Level
China's tire industry has formed a relatively complete system, capable of meeting the needs of the automotive industry, and some enterprises have made progress in technological R&D, with technical levels approaching international advanced standards. However, several issues remain: First, many enterprises have weak independent R&D capabilities, with a significant gap in the R&D of high-performance passenger car radial tires compared to international levels. Second, product quality and manufacturing precision are low. Finally, there are many enterprises, partially concentrated in the mid-to-low-end sectors, with homogeneous competition, and the comprehensive technical and product performance still lags behind advanced enterprises.
In summary, while China is a major tire producer and exporter, there is still a gap in R&D capabilities, equipment and process technology levels, and brand influence compared to international standards.
(2) Industry Technical Development Trends
After more than 150 years of the "pre-industrial era" of tires, the global tire industry has entered the "post-industrial era," with a new round of technological revolution underway, primarily reflected in several aspects:
-Continuous improvement in tire product performance, developing toward high-tech and refined products;
-Development of innovative tire products, integrating safety, greenness, environmental protection, and intelligence, becoming a new global tire development trend;
-Development of fully automated tire production technologies, with low-temperature continuous mixing and fully automated radial tire production lines centered on tire shaping, evolving toward low energy consumption, high efficiency, and high precision;
-The integration of automotive tires with AI is driving smarter, more efficient, and safer driving experiences. For example, AI algorithms can provide precise maintenance and replacement recommendations based on data, reducing the risk of tire blowouts or other failures. AI can adjust tire grip and traction during acceleration to ensure better acceleration performance and reduce tire slippage. With the continuous development of AI technology, future tires will be more than just physical components—they will be intelligent systems that enhance overall driving performance and safety through continuous optimization and real-time adjustments. With the popularization of autonomous driving and intelligent transportation technologies, tire intelligence will become increasingly important, serving as an indispensable part of vehicle systems.
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