FINANCE

Indian Tyre Industry Set for 12-Fold Revenue Growth by 2047

Mumbai: The Indian tyre industry is poised for a significant transformation, with revenue projected to grow 12-fold to ₹1,300 thousand crore by 2047, according to a joint report by the Automotive Tyre Manufacturers Association (ATMA) and PwC India. This growth will be driven by strong domestic OEM and replacement tyre demand, accelerated expansion of vehicle exports, and a shift towards premiumization, sustainability-led innovation, and technology.

Key Drivers of Growth

  • Rising economic activity from infrastructure spending and strong domestic consumption will drive OEM and replacement tyre revenue by ~10% CAGR till FY47.
  • Robust passenger vehicle and two-wheeler sales, led by improving per capita income, and rising commercial vehicle sales, driven by strong infrastructure spending and consumption demand, are expected to drive OEM tyre demand.
  • Increased people mobility and freight availability will support replacement tyre demand.

Export Market Expansion

  • The export market for Indian tyres is set to expand significantly by FY47, with targeted interventions enhancing India’s export market position.
  • Adopting export-centric growth strategies, supported by market and use case-specific innovations, improved market access through newer Free Trade Agreements, and improved cost competitiveness and brand positioning, will be key factors aiding acceleration of exports.

Servitisation Market Growth

  • Exponential adoption of professional tyre management services among fleet operators will drive the servitisation market through FY47.
  • Increased recognition of the importance of managing tyre health and end-customer demand for TPMS-ready fleets will likely drive demand for services like professional periodic tyre management, tyre advisory, and optimal fleet management solutions.

CHARGE Framework

  • PwC India has proposed a CHARGE framework, focusing on six levers:
    • Customer Relevance: Offering customer-centric value propositions
    • High-Quality Standards: Adopting futuristic technologies to drive continuous quality improvement
    • Adaptability: Enhancing agility in responding to market trends
    • Resilience, Resource Efficiency, and Sustainability: Driving cutting-edge and rapid global innovation
    • Growth through Innovation: Fostering innovation and entrepreneurship
    • Empowering Alliances and Partnerships: Forging strategic partnerships to deliver on industry growth aspirations

Expert Insights

  • Kavan Mukhtyar, Partner and Leader – Automotive, PwC India, notes that India’s journey towards Viksit Bharat 2047 presents a huge opportunity for the tyre industry to transform itself and drive sustainable growth.
  • Arun Mammen, Chairman, ATMA, emphasizes that the industry’s growth will be fueled by a shift towards premiumization, sustainability-led innovation, and a strong focus on technology and exports ¹.

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