Every year, around 24 million retread tires are being sold, which saves around 360 million gallons of oil per year on average. Most of the retread tires are as durable as the new ones and undergo the same testing procedure as any new tire. Prolonged use of commercial and off-the-road vehicles with a heavy load for constructional, mining, infrastructural activities are expanding the demand for retreated tires as they cost 40% less than new tires. Increasing influx of investments for the production and development of retreated tires and introduction of new varieties of high-quality tires are anticipated to fuel the growth of the global retreated tire market.
Rising Demand for Retread Tires in Commercial Vehicles
In recent years, the demand for commercial vehicles have grown significantly, owing to rapid industrialization and rising number of business activities across the world. Tires used in medium and heavy commercial vehicles have a short shelf life due to great load carriage, long distance travels, and high traction. This has created a need for replacing the tires more than passenger cars and off-the-road vehicles, which adds up to the operating cost of the vehicles. Hence, commercial fleet owners are largely preferring to opt for retread tires, which are less expensive than replacing the old ones with new tires. In 2021, the commercial vehicle segment accounted for 85.87% of the market share in the global retread tire market. Expanding need for logistics services, rising demand for freight transportation, and growing commercialization are anticipated to boost the adoption of retread tires in the coming years.
Increasing Need for Economical Tires to Boost Market Growth
Retreaded tires require lesser raw materials and energy to manufacture as compared to new tires, which is beneficial for the environment as well as fleet operators to reduce operating cost of the vehicles. Using the retreaded tires would reduce landfill pollution, which would prevent environmental degradation. Moreover, public/government-municipal fleet owners are turning to retreated tires to reduce average cost per mile. Thus, consumers are showing higher preference towards sustainable solutions such as retread tires for commercial and heavy vehicles alike. Leading tire manufacturers like Goodyear, Bridgestone, Michelin, etc. are introducing tires that are fairly similar to the original tires in terms of quality. Hence, rising average sale prices of new tires and increasing consumer awareness about the cost-effectiveness and sustainability of retread tires are expected to fuel the growth of global retread tire market in the coming years.
Expansion of Logistics Industry to Amplify Retread Tire Sales
Increase in global trade activities in developing economies and rise in trade-related agreements are contributing to the expanding logistics industry. As businesses creating products for consumption are expected to grow, the demand for logistics services and operations would also grow significantly. This would create more demand for commercial vehicles that are required to carry products to warehouses and make last-mile deliveries. Hence, the ever-increasing demand for vehicles in the logistics industry are anticipated to boost the demand for retreated tires in the coming years.
According to TechSci Research report on “Global Retread Tire Market By Vehicle Type (Commercial Vehicle, Passenger Car & OTR Vehicle), By Retread Process (Cold Process & Hot Process), By Region, Competition, Forecast & Opportunities, 2027”, the global retread tire market is expected to register growth at a CAGR of approx. 4% during the forecast period. The market growth can be attributed to the growing construction projects and mining activities coupled with the rising availability of retread tires at economical prices.