Saudi Arabia's Tire Market to Grow 17 Percent
Saudi Arabia has one of the highest number of per capita vehicles, globally. In 2013, about 740,000 commercial vehicles and passenger cars were sold in the Kingdom. Saudi Arabia lacks in terms of vehicle production as only a handful automobile assembly units are located across the country. As a result, the entire domestic demand for automobiles as well as tires is met solely through imports. However, expanding growth potential in the automobile sector is attracting several vehicle manufacturers to Saudi Arabia. Japanese car maker Isuzu has constructed a production facility in Dammam Industrial City 2 and plans to manufacture about 25,000 light trucks and heavy duty trucks by 2017, primarily to address swelling domestic as well as exports demand from the MENA region. This is expected to considerably boost OEM tyre sales in the country over the next five years, according to research by ReportBuyer.
According to "Saudi Arabia Tyre Market Forecast & Opportunities, 2019," published by ReportBuyer, the tire market in Saudi Arabia is forecast to grow at a CAGR of around 17 percent until 2019. Increasing passenger car sales, expanding automobile fleet size, favorable government policies and significant foreign investments in the automotive sector are some of the key factors propelling tire demand in Saudi Arabia.
Due to extreme weather conditions, replacement period for tires is relatively shorter, which is also a major reason for increasing replacement tire sales in the Kingdom. Passenger car tire is the most dominating segment in the Saudi Arabia tire market, followed by commercial vehicle tire and other vehicle tire segments. The Kingdom's Western and Central regions, comprising Riyadh, Mecca, and Madinah, collectively account for around 57 percent of the total tire sales in Saudi Arabia.
Besides major Chinese brands, some leading tyre manufacturers like Bridgestone, Michelin, Continental, Goodyear and Yokohama have established themselves as key players in the Saudi Arabia tire market, according to ReportBuyer.