Automotive Green Tires Market by Vehicle Type (PC, LCV, Trucks and Buses), Rim Size (13-15”, 16-18”, 19-21” and >21”), Propulsion Type (ICE and EV), Application (On-road and off-road), Sales Channel & Region - Global Forecast to 2028
[218 Pages Report] The global automotive green tires market size is projected to grow from USD 11.5 billion in 2023 to USD 15.8 billion by 2028, at a CAGR of 6.5%. The major area of development in electric vehicles is their driving range on a single charge. Green tires can increase vehicle range. Green tires are designed to have lower rolling resistance than conventional tires. The lower the rolling resistance, the less energy is required to roll the tire, which can lead to increased vehicle range. The demand for electric vehicles with increased range will drive the green tires market.
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Automotive Green Tires Market Dynamics:
Driver: Government initiatives for clean and green environment
There is a rise in concern regarding the various factors affecting the fuel efficiency and emissions of CO2 into the atmosphere. Governments across the globe have started several initiatives to reduce the fuel consumption and release of greenhouse gases. Stringent CO2 emission norms have increased the demand for green tires. The European Union (EU) has set ambitious targets to reduce greenhouse gas emissions. The current target is to reduce emissions by at least 55% by 2030, compared to 1990 levels. This target is part of the EU's commitment to climate neutrality by 2050. The United States has set a target to reduce greenhouse gas emissions by 50-52% below 2005 levels by 2030. This target is part of the US administration's commitment to achieve net-zero emissions by 2050. China has pledged to achieve carbon neutrality by 2060. Tires contribute to around 17- 20% fuel usage and 20-24% of CO2 emission in a single vehicle. Green tires are low rolling resistance tires which reduce the fuel consumption by around 2-4%, thus, reducing the CO2 emission. Hence, with the reduced carbon emission targets, the green tires market will grow.
Restraint: Lack of awareness in emerging economies
The consumers are well-aware about the benefits of using CNG and hybrid vehicles; however, there is a lack of awareness regarding the benefits of green tires and the role it plays in reducing fuel consumption. In the emerging economies such as India and Indonesia, the general consumer is less focused on the benefits offered by green tires. There are a number of reasons why people are not aware of green tires. One reason is that they are not as widely available as traditional tires. Another reason is that they are often more expensive than traditional tires. Additionally, many people are not familiar with the benefits of green tires. There are a number of things that can be done to raise awareness about green tires. One thing is to make them more widely available. Another thing is to educate people about the benefits of green tires. This can be done through advertising, public relations, and educational materials.
Opportunity:Green replacement tires
Though the demand for green tires is increasing among various automotive manufacturers, i.e., at Original Equipment (OE) level, the replacement tires market is expected to provide a lot of opportunity for manufacturers in the future. The demand for replacement tires is expected to rise during the forecast period due to the higher vehicle utilization at the backdrop of an increase in cab sharing facility across the globe. As people's disposable incomes rise, they are more likely to replace their tires before they wear out. New tire technologies are being developed that offer improved fuel efficiency, performance, and safety. The logistics industry is a major consumer of fuel. As the industry grows, there is an increased demand for fuel-efficient vehicles. Green tires can help to improve the fuel efficiency of vehicles, which can reduce the environmental impact of the logistics industry. Governments are increasingly regulating the environmental impact of the logistics industry. This is leading to a demand for more fuel-efficient vehicles and green tires. This is also driving the demand for green replacement tires.
Challenge: Increasing number of mandatory tests to be performed before commercial use of Tires
Regulatory organizations such as the U.S. Department of Transportation (DOT), National Highway Traffic Safety Administration (NHTSA), European Tyre and Rim Technical Organization (ETRTO), Japanese Automobile Tire Manufacturers Association (JATMA), and others make it mandatory for tire manufacturers to conduct certain tests on tires before commercializing. These tests include durability, endurance, traction, rolling resistance, and load carrying. Tire manufacturers have to bear the cost of mandatory tests, which are expensive. In case a tire fails to fulfil the requirement of any of these mandatory tests, the manufacturer cannot sell that tire in the market and suffers complete loss on R&D for that tire. These tests help to ensure that tires are safe and meet certain performance standards, which can help to prevent accidents and improve air quality. In addition to mandatory tests, tire manufacturers also conduct voluntary tests to improve the performance and safety of their tires. Tests include braking test, handling test, wet traction, durability, fuel efficiency and others. These tests indirectly increase the total cost of tires, which negatively affects its demand in the OE as well as aftermarket.
Automotive Green Tires Market Ecosystem
The ecosystem analysis highlights various players in the automotive green tires ecosystem, which is primarily represented by OEMs, Tire manufacturers, Suppliers. Prominent companies in this market as Michelin (France), Bridgestone Corporation (China), Goodyear (US), Continental (Germany) and Pirelli (Italy), etc.
19-21” segment is expected to witness significant growth rate in the global automotive green tires market during the forecast period
Tires with a rim size of 19–21” are estimated to have significant demand in premium cars and high performance sports cars. These vehicles are designed for performance and handling, and larger tires can provide better grip and performance. Michelin offers Pilot Sport Cup 2 tires for new Audi R8 with rim size of 21 inch. Drivers can choose tires with different widths, sidewall profiles, and tread patterns. The tires offered by OEM are also limited in terms of availability, especially for older vehicles, whereas the aftermarket tires, on the other hand, are often made for a variety of vehicle models and years. This makes it easier for drivers to find the tires they need for their older vehicles. Hence, tire size availability in the aftermarket and customization will drive the market for 19–21” rim-size tires during the forecast period.
On-Road segment is expected to be the largest in automotive green tires market during the forecast period
The on-road vehicles include passenger cars, LCVs, and trucks, which run on roads for the transportation of passengers and goods from one place to other. The demand for on-road vehicles such as passenger cars and LCVs is on the rise and expected to boost the green tires market in the on-road application segment. In May 2023, Cheng Shin Rubber launched tire for two-wheel applications built using the company’s Eco-Re sustainable development technology. The tire’s rolling resistance has also been reduced by more than 10% and discarded rice husks were used as a renewable raw material in production. In September 2022, ZC Rubber announced to expand truck tire plant in Westlake, USA. The new plant will also recycle tires. The trucks generally run on highways as these are used for delivery of goods across different states and cities. The trucks can be long, medium, and short haul depending on the distance the trucks have to cover for delivery. In March 2023, Amazon announced that it would be using sustainable tires for its delivery fleet. The tires are made from recycled materials and are designed to reduce emissions. Amazon says that the new tires will help it to reduce its carbon footprint by 100,000 metric tons per year. The rise in frequency of deliveries will boost the demand for green tires, as it will have an economic benefit during the long run.
Light Commercial Vehicle segment is expected to have significant growth opportunities in automotive green tires market during the forecast period
Light commercial vehicles (LCVs) include automobiles having four wheels and a seating capacity of more than eight persons. LCVs include mini buses, and small trucks and are used for transportation of goods as well as passengers. LCVs can carry a weight of 3.5 to 7 tons, which depends on the regional transport regulations. Green tires can help to reduce the operating costs of commercial vehicles by improving fuel efficiency and reducing emissions. This can lead to significant savings for fleet owners. Green tires can also improve the safety of commercial vehicles by providing better traction and handling in wet and icy conditions. This can help to prevent accidents and reduce injuries. In 2020, Pirelli announced to supply sustainable tires to Rivian R1T and Ford F-150 Lightning. Sustainable tires can also have a longer lifespan than traditional tires. This can save money on replacement costs, especially for vehicles that are used for a lot of deliveries. In addition to these benefits, sustainable tires can also help to improve the environmental sustainability of delivery operations. By reducing fuel consumption and emissions, sustainable tires can help to reduce the environmental impact of delivery vehicles.
“The Asia pacific automotive green tires market is projected to hold the significant market share by 2028.”
China, Japan, South Korea, and India are the key green tires markets in this region. China is the largest market for green tires in the region. The growing population, government initiatives, and rapid industrialization in the developing countries have led to the increased demand for green tires in the APAC region. The increase in vehicle production and increased demand for low rolling resistance tires in vehicles are the key factors driving the growth of the green tire market in the Asia Pacific region.
China is considered as the manufacturing hub for the automotive industry. This, in turn, is estimated to drive the growth of the green tire market in the Asia Pacific region. In the past few years, the Asia Pacific region has experienced an increase in the demand for luxury or premium segment vehicles. Asia Pacific has emerged as a production hub for major tire manufacturing companies such as Continental (Germany), Goodyear (US), Cooper (US), Pirelli (Italy), Michelin (Singapore), Bridgestone Corporation, Yokohama, Hankook Technology Group Co. Ltd. (South Korea), Nokian (Finland), Apollo Tyres (India), and Sumitomo Rubber Industries (Japan) as of June 2023. In 2021, Asahi Kasei, a Japanese company announced to produce sustainable solution-polymerized styrene-butadiene rubber (S-SBR) for eco friendly tires.
Key Market Players
The Green Tires market is dominated by a few globally established players such as Michelin (France), Bridgestone Corporation (China), Goodyear (US), Continental (Germany) and Pirelli (Italy). The green tires market is highly competitive with growing capacity expansion by the regional players. These companies adopted strategies such as new product launches, deals and others to gain traction in the Green Tires market.
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Report Metric |
Details |
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Market size available for years |
2023–2028 |
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Base year considered |
2022 |
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Forecast period |
2023-2028 |
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Forecast units |
Volume (Thousand Units) & Value (USD Million/Billion) |
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Segments covered |
sales channel, application, rim size, vehicle type, propulsion type and Region |
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Geographies covered |
Asia Pacific, North America, Europe, South America and Middle East & Africa |
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Companies Covered |
Michelin (France), Bridgestone Corporation (China), Goodyear (US), Continental (Germany) and Pirelli (Italy) |
This research report categorizes the automotive green tires market based on sales channel, application, rim size, vehicle type, propulsion type and Region.
Automotive Green Tires Market, By Vehicle Type
- Passenger Cars
- Light Commercial Vehicles
- Heavy Commercial Vehicles
- Buses
- Two-wheelers
Automotive Green Tires Market, By Rim Size
- 13-15”
- 16-18”
- 19-21”
- >21”
Automotive Green Tires Market, By Application Type
- On-Road
- Off-Road
Automotive Green Tires Market, By Propulsion Type
- ICE
- EV
Automotive Green Tires Market, By Sales Channel Type
- OEM
- Aftermarket
Automotive Green Tires Market, By Region
- North America
- Europe
- Asia Pacific
- South America
- Middle East & Africa
Recent Developments
- In June 2023, Michelin announced to invest USD 27.8 million to expand car tire production capacity at its Shenyang, China factory by 1.3 million tires..
- In February 2023, Bridgestone announced to invest USD 72.4 million by 2025 expand production capacity and upgrade technology at its Pune-based plant. It will improve the plant capability in terms of technologies and capacities for the manufacture of tires for the passenger car segment.
- In June 2022, Michelin and Hyundai Motor Company announced collaborate on R&D for innovative tire technologies by 2025. The companies will develop eco-friendly tires with increased use of eco-friendly materials.
- In May 2022, Goodyear announced to invest USD 77 million for its new manufacturing facility in Dudelange, Luxembourg. It features a new process focused on small-batch production of large rim diameter ultra-high performance (UHP) and ultra-ultra-high performance (UUHP) tires, which enables the company to produce tires four times faster than a standard production cycle.
- In May 2022, Pirelli announced to invest USD 15 million to create an advanced technology and digitalization hub for tire production at its factory in Silao, Mexico.
Frequently Asked Questions (FAQ):
What is the current size of the global automotive green tires market?
The global automotive green tires market is estimated to be USD 11.5 billion in 2023 and projected to reach USD 15.8 billion by 2028.
Who are the winners in the global automotive green tires market?
Michelin (France), Bridgestone Corporation (China), Goodyear (US), Continental (Germany) and Pirelli (Italy). These companies develop new products, adopt expansion strategies, and undertake collaborations, partnerships, and mergers & acquisitions to gain traction in the automotive green tires market.
What are the new market trends impacting the growth of the automotive green tires market?
Increasing demand for more efficient tires, and growing sales of electric vehicles equipped with automotive green tires are some of the major trends affecting this market.
Which region is expected to be the largest market during the forecast period?
Asia Pacific is expected to be largest market and is projected to grow at fastest CAGR during the forecast period.
What is the total CAGR expected to be recorded for the automotive green tires market during 2023-2028?
The CAGR is expected to record a CAGR of 6.5% from 2023-2028.
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The study involved four major activities to estimate the current size of the automotive green tires market. Exhaustive secondary research was done to collect information on the market, the peer market, and model mapping. The next step was to validate these findings, assumptions, and sizing with the industry experts across value chains through primary research. The bottom-up and top-down approaches were employed to estimate the total market size. After that, market breakdown and data triangulation were used for determining the market size of segments and subsegments.
Secondary Research
The secondary sources referred for this research study include associations such as the Tire Industry Association, Tire and Rim Association, Inc., Rubber Manufacturers Association, Organization Internationale des Constructeurs d'Automobiles (OICA); corporate filings (such as annual reports, investor presentations, and financial statements), trade, business, and automotive associations. Secondary data has been collected and analyzed to arrive at the overall market size, which is further validated through primary research.
Primary Research
Extensive primary research has been conducted after acquiring an understanding of the automotive tire market through secondary research. Several primary interviews have been conducted with market experts from both the demand- (Automotive OEMs and Retreading Organizations) and supply-side (rubber suppliers, steel suppliers, oil companies, and others) players across four major regions—namely, North America, Europe, Asia-Pacific, South America & Middle East and Africa. Approximately 30% and 70% of primary interviews were conducted from the demand and supply sides, respectively. The primary data was collected through questionnaires, emails, and telephonic interviews. In the canvassing of primaries, MnM has strived to cover various departments within organizations, such as sales, operations, and marketing, to provide a holistic viewpoint in the report.
After interacting with industry experts, brief sessions with highly experienced independent consultants were conducted to reinforce the findings from primaries. This, along with the in-house subject matter experts’ opinions, led to the findings as described in the remainder of this report.
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Market Size Estimation
A detailed market estimation approach was followed to estimate and validate the volume & value of the green tires market. Key players in the green tires market were identified through secondary research, and their global market shares were determined through primary and secondary research. The research methodology included the study of the annual and quarterly financial reports & regulatory filings of major market players, as well as interviews with industry experts for detailed market insights. All major penetration rates, percentage shares, splits, and breakdowns for the green tires market were determined using secondary sources, model mapping, and verified through primary sources. All key macro indicators affecting the revenue growth of the market segments and subsegments were accounted for, viewed in extensive detail, verified through primary research, and analyzed to get the validated and verified quantitative & qualitative data. The gathered market data was consolidated and added with detailed inputs, analyzed, and presented in this report
- The key players in the industry and markets have been identified through extensive secondary research.
- The industry’s future supply chain and market size, in terms of value, have been determined through primary and secondary research processes.
- All percentage shares, splits, and breakdowns have been determined using secondary sources and verified through primary sources.
Global Automotive Green Tires Market Size: Bottom-Up Approach
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Data Triangulation
After arriving at the overall market size of the global market through the above-mentioned methodology, this market was split into several segments and subsegments. The data triangulation and market breakdown procedure were employed, wherever applicable, to complete the overall market engineering process and arrive at the exact market value data for the key segments and subsegments. The extrapolated market data was triangulated by studying various macro indicators and regional trends from both the demand- and supply-side participants.
Market Definition
Automotive Green Tires: Green tires are defined as tires honed for low rolling resistance, using materials such as silica. Rolling resistance is the energy dissipated from the friction of the tire rolling on a given surface as well as the energy wasted by the contracting of the tire sidewalls as the tire moves across the road. The addition of silica to the tire formulation results in the tires being more energy-efficient as well as increasing the overall safety of the green tires.
Key Stakeholders
- Associations, Forums, and Alliances related to Green Tires
- Automobile Manufacturers
- Automotive Component Manufacturers
- Automotive Investors
- Aftermarket & Tire Retreading Associations
- Companies Operating in Autonomous Vehicle Ecosystem
- Electric Pick-up Truck Manufacturers
- Electric Medium and Heavy-duty Truck Manufacturers
- Distributors and retailers
- EV Component Manufacturers
- EV Distributors and Retailers
- Government Agencies and Policy Makers
- Green tires manufacturers
- Green tires traders, distributors, and suppliers
- Government and research organizations
- Original Equipment Manufacturer (OEM)
- Organized and Unorganized Aftermarket Suppliers
- Raw Material Suppliers of Tires/Tire Components (suppliers for tier I)
- Transport Authorities
- Technology Providers
Report Objectives
- To segment and forecast the size of the green tires market in terms of volume and value.
- To segment and forecast the size of the global market, by volume & value, based on propulsion type [ICE and EV]
- To segment and forecast the size of the global market, by volume & value at based on vehicle type [ passenger cars, light commercial vehicles, heavy commercial vehicles, buses and two-wheelers]
- To segment and forecast the size of the global market, by volume & value, based on rim size (13-15”, 16-18”, 19-21” and >21”)
- To segment and forecast the size of the global market, by volume & value at global level, based on application (on-road and off-road)
- To segment and forecast the size of the global market, by volume & value at global level, based on sales channel (OEM and Aftermarket)
- To segment and forecast the market size, by volume & value, based on region [Asia Pacific, Europe, South America, North America and Middle East & Africa]
Available Customizations
With the given market data, MarketsandMarkets offers customizations in accordance to the company’s specific needs.
- Automotive Green Tires market, by EV type, at regional level
- Automotive Green Tires market, by Sales Channel, at regional level
- Profiling of additional market players (Up to 5)
Growth opportunities and latent adjacency in Automotive Green Tires Market