Australian Tire Market Set to Reach US$3.9B by 2021
According to TechSci Research report "Australia Tire Market Forecast &Opportunities, 2021'’ the tire market in Australia is forecast to reach US$ 3.9 billion by 2021, on account of expanding vehicle fleet size, rising urbanization, rapid industrialization and robust pace of infrastructure developments.
In February 2016, the Australian government launched its first long-term infrastructure plan, with major focus on filling infrastructure gaps and improving road, rail as well as port connectivity. This is projected to fuel demand for tires from commercial and OTR vehicle segments in the coming years. Due to imposition of high import duties, passenger car OEMs such as Ford, Toyota and Holden have announced closure of their manufacturing facilities in the country, and consequently, demand from replacement segment is anticipated to dominate the country's tire market through 2021, according to the report.
Vehicle sales in Australia grew at a CAGR of more than 3% during 2011-2015, with unit sales increasing from 1.12 million units in 2011 to 1.26 million units in 2015. The automobile vehicle fleet size in Australia also increased from 15.19 million units in 2011 to 18.01 million units in 2015, according to the report.
Expanding fleet size boosted replacement demand for tires in the country during the same period. Further, the Australia tire market is dominated by the passenger car tire segment, followed by light commercial vehicle tire segment, and this trend is expected to continue during the forecast period. Booming construction and logistics sectors are projected to drive robust growth in demand for medium and heavy commercial vehicles and related tire products in the country, over the next five years, according to the report.
Australian Capital Territory and New South Wales are the leading regional markets for tires in Australia, due to high population density, large vehicle fleet size and high concentration of industries and businesses in the region, according to the report.