Summary

Global Sustainable Tire Materials Market Overview

The global sustainable tire materials market is projected to reach $533.9 million by 2032 from $34.9 million in 2022, growing at a CAGR of 32.88% during the forecast period 2023-2032. The growth in the sustainable tire materials market is expected to be driven by growing demand for sustainable tires, rising developments, and integration of sustainable tire materials in passenger vehicle and commercial vehicle tires in the manufacturing process.

Introduction of Sustainable Tire Material

The term “sustainable tire material” refers to recycled, renewable/bio-based materials contributing to sustainable practices related to tire manufacturing, reducing resource consumption and emissions. Sustainable tire materials can help minimize tire production’s environmental impact, improve the end-of-life disposal process, and contribute to a more sustainable future. Materials used in sustainable tires include natural rubber, recycled rubber, sustainable carbon black, silica, recycled cord, vegetable oils, and eco-friendly chemicals. There is still much research going on to launch new sustainable tire materials.

Market Introduction

Using non-renewable resources for manufacturing tires leads to harmful carbon emissions and increases the environmental impact. Leading tire manufacturers such as The Goodyear Tire and Rubber Company and Michelin started producing sustainable tires with a lower carbon footprint, longer lifespan, and more fuel-efficient tires. Ambitious targets from countries worldwide to reduce environmental impact are expected to increase the adoption of sustainable tire materials in tire manufacturing. Also, increasing research and development activities in sustainable tire material space may result in the launch of new and innovative sustainable or sustainable tires. At present, the sustainable tire materials market is at a nascent stage, and it is expected that the market will grow at a notable growth rate in the forecast period (2023-32).

Industrial Impact

The sustainable tire materials market is driven by several factors, such as the extended lifespan and cost efficiency of sustainable tires and augmented demand for sustainable tire materials from transportation and logistics. In recent years, there has been a substantial increase in the adoption of environmentally friendly tire materials during the tire manufacturing process.

The key players operating in the sustainable tire materials market include PPG Industries, Inc., Evonik Industries AG, and Solvay. These companies are focusing on strategic partnerships, collaborations, and acquisitions to enhance their product offerings and expand their market presence. In conclusion, the market for sustainable tire materials is growing and evolving significantly because of factors such as rising safety and efficiency concerns, technological breakthroughs, and the demand for reliable modes of transportation solutions.

Market Segmentation:

Segmentation 1: by Type of Material
• Rubber
o Natural
o Recycled
• Sustainable Carbon Black
• Silica
• Others

Rubber Segment to Dominate the Global Sustainable Tire Materials Market (by Type of Material)

Both natural rubber and recycled rubber play vital roles as primary raw materials in the production of sustainable tires. The consumption of rubber in a single sustainable tire outweighs the usage of alternative materials such as silica and sustainable carbon black. The recycling of waste tires to produce recycled rubber for new tires has witnessed significant growth in recent years, and this trend is expected to continue in the forecast period. Collaborative efforts between tire manufacturers and tire associations are anticipated to bring about a substantial revolution in the market for sustainable tire materials. Natural rubber, being a sustainable and renewable resource, offers multiple positive outcomes from economic, social, and environmental perspectives.

Segmentation 2: by Propulsion Type
• Internal Combustion Engine Vehicles
• Electric Vehicles

Internal Combustion Engine Vehicles Expected to Hold Significant Market Share in the Global Sustainable Tire Materials Market (by Propulsion Type)

At present, the internal combustion engine (ICE) vehicles segment holds a significant share of the sustainable tire materials market compared to the electric vehicles (EVs) segment. Although EVs have a higher rate of sustainable tire material adoption per 1,000 vehicles, the large fleet size of ICE vehicles and the frequent tire replacements in that market segment contribute to their prevailing position. As vehicle manufacturers align with sustainability objectives and strive to reduce carbon emissions, they are increasingly embracing tires with lower environmental impact. However, as the forecast period progresses and the fleet size of EVs expands, it is anticipated that revenue from ICE vehicles may decline.

Segmentation 3: by Vehicle Type
• Passenger Vehicles
• Commercial Vehicles

Passenger Vehicles Segment Expected to Dominate the Global Sustainable Tire Materials Market (by Vehicle Type)

The passenger vehicle segment is anticipated to surpass the commercial vehicle segment in terms of production and sales, driven by the increasing adoption of sustainable tire materials and the growing awareness of their benefits. The demand for both ICE and EV passenger vehicles is expected to experience significant growth compared to commercial vehicles. This growth can be attributed to the rising demand for efficient, environment-friendly, and connected vehicles in the forecast period, which is expected to consequently boost the sustainable tire materials market. The increasing popularity of sustainable tires is also likely to influence vehicle owners to opt for aftermarket sustainable tires.

Segmentation 4: by Tire Structure
• Radial
• Bias

Radial Segment Anticipated to Lead the Global Sustainable Tire Materials Market (by Tire Structure)

Compared to bias tires, radial tires are the preferred option for most contemporary passenger and commercial vehicles. This is primarily due to the numerous advantages they offer, making them the prevalent choice in the industry. Radial tires excel in providing a comfortable and smooth driving experience due to their flexible sidewalls that effectively absorb road imperfections and minimize vibrations. In the realm of trucks, radial tires are unquestionably the optimal selection.

Segmentation 5: by Sales Channel
• OEMs
• Aftermarket

OEMs Segment Anticipated to Dominate the Global Sustainable Tire Materials Market (by Sales Channel)

The original equipment manufacturers (OEMs) segment was projected to hold the largest market share in 2022, mainly attributed to the limited consumer awareness regarding environmentally friendly tire choices available in the aftermarket. While sustainable tire materials are being introduced in both OEMs and aftermarket sales channels, their consumption is presently higher in the OEMs segment. The implementation of carbon emission targets by vehicle manufacturers, tire manufacturers, and governments is propelling the adoption of sustainable tires at the factory level.

Segmentation 6: by Region
• North America: U.S., Canada, and Mexico
• Europe: Germany, France, Italy, Spain, and Rest-of-Europe
• U.K.
• China
• Asia-Pacific and Japan: Japan, South Korea, India, and Rest-of-Asia-Pacific and Japan
• Rest-of-the-World

Europe Expected to Dominate the Sustainable Tire Materials Market (by Region)

Europe currently holds the largest market share in the sustainable tire materials market, and it is expected to maintain its leading position until 2032. Europe’s dominance can be attributed to its significant production and consumption of natural rubber and recycled rubber for tire manufacturing. The country's robust presence in the sustainable tire materials market is driven by its strong production capabilities and demand. Notable sustainable tire manufacturers such as Continental AG, Michelin, and Pirelli & C. S.p.A. are actively increasing their production of sustainable tires in the region to meet the growing demand.

Recent Developments in the Global Sustainable Tire Materials Market

• In January 2023, Solvay introduced bio-circular silica in Europe, with plans to expand to North America. In the coming years, the Solvay Group might gradually replace its existing Zeosil portfolio with circular HDS, providing a circular solution for tires that may increase the use of sustainable raw materials and reduce the tire industry's carbon footprint.
• In August 2021, carbon black manufacturer Birla Carbon announced the widest availability of clean carbon black products in India by expanding production capacity at Gummidipoondi, India.
• In October 2021, PKA divested 51% of shares in Genan Holding A/S to Maj Invest Equity. PKA continues to co-own as a minority shareholder. The ambition is that tire recycling, in general, should become significantly more prevalent in the future.
• In October 2022, Tatneft PJSC and Nokian Tyres plc reached an agreement for the sale of Nokian Tyres Russian business. The acquisition price, which is free of debt and cash, was close to $425.5 million.

Demand – Drivers, Limitations, and Opportunities

Market Drivers: Stringent Regulations and Carbon Neutrality Targets

The sustainable tire materials market is primarily propelled by stringent carbon emission regulations. The Paris Agreement, established in 2015, aims to limit global warming to a maximum of 1.5°C, prompting approximately 196 countries to reduce their greenhouse gas emissions accordingly. The European Union (EU) has set ambitious targets to become a leader in climate-neutral economies and societies by 2050. In November 2022, during the COP26 summit in Glasgow, Scotland, Indian Prime Minister Mr. Narendra Modi pledged to achieve net-zero carbon emissions in India by 2070, along with a target to source 50% of the country's energy from renewable sources by 2030. As the world's largest economy, the U.S. faces the challenge of being one of the largest emitters of CO2. However, at the COP27 conference in November 2022, the U.S. government launched the net-zero initiative, committing to decarbonization and achieving net-zero government emissions by 2050. In addition to the U.S., 18 other countries, including the U.K., Canada, Germany, France, Switzerland, the Netherlands, Belgium, Finland, Ireland, Austria, Cyprus, Lithuania, Israel, Japan, Korea, Singapore, Australia, and New Zealand, also participated in this initiative. The tire manufacturers' commitment to carbon-zero targets is expected to significantly drive the global sustainable tire materials market in the coming years.

Recycling is another crucial initiative to substantially reduce greenhouse gas emissions. Scrap materials, including discarded metal products, often contain toxic chemicals such as mercury and lead. Improper disposal of these chemicals can pose environmental hazards and pollute the soil and water. Promoting the recycling of steel used in tires helps protect natural resources, as steel manufacturing relies on various raw materials, including finite iron ore reserves. Several governments have taken action to implement circular economic strategies, aiming to safeguard environmental resources and reduce emissions. For instance, the European Union (EU) announced its Circular Economy Action Plan (CEAP) in March 2020 with the goal of fostering a circular economy and sustainable growth in Europe.

Market Challenges: Volatility of Tire Prices Made from Sustainable Tire Materials

Investing in tires made from sustainable tire materials can lead to long-term savings through reduced fuel costs. The price of natural rubber, a commonly used sustainable material in tire manufacturing, is subject to fluctuations based on various factors. Supply chain issues in the natural rubber market can result in significant changes in tire pricing. A research paper titled "Impacts of Sustainable Tire Technology: Case Study of Environmental and Customer Perspectives" reveals that sustainable tires, which contain a higher percentage of sustainable tire materials, offer enhanced durability and generate lifecycle waste equivalent to the cost of two conventional tires.

However, the cost of tires composed of sustainable materials is also influenced by factors such as raw material availability, import and export duties, manufacturing costs, and labor expenses in the manufacturing country. It is anticipated that the cost of sustainable tires will decrease during the forecast period of 2023-2032, driven by ongoing research and development efforts in the global sustainable tire materials market. Each tire manufacturer employs its unique approach to manufacturing sustainable tires, incorporating new tread designs, reducing tire weight, and optimizing the proportion of raw materials used in the manufacturing process.

Market Opportunities: Growing Demand for New Sustainable Tire Materials

The market for sustainable tire materials is currently in its early stages, with ample opportunities for tire manufacturers to introduce innovative and disruptive materials. Companies in the tire materials industry are consistently unveiling new types of sustainable materials, including bio-based silica, recycled tire carbon black, and vegetable oils, among others, to produce tires made entirely of sustainable materials at reduced manufacturing costs. Tire manufacturers are actively investing in sustainability to minimize carbon emissions associated with tires by incorporating a higher proportion of sustainable tire materials.

In many instances, products lack sustainability due to inefficient processes and technologies that hinder the proper transformation of materials and energy usage. As a result, these products generate waste in terms of time, effort, and energy consumption. The forecast period anticipates the launch of numerous new and innovative sustainable tire materials, which could significantly impact existing materials in the market. The growth of the chemical industry is expected to drive extensive research and development activities in the global sustainable tire materials market. While the market is still in its growth phase, tire manufacturers such as Continental AG, Michelin, and The Goodyear Tire and Rubber Company have achieved significant market share due to their substantial research and development investments in the market.

How can this report add value to an organization?

Product/Innovation Strategy: Globally, the leading sustainable tire materials manufacturers are continuously working to develop new and innovative sustainable tire materials. The growing need for efficient, eco-friendly, and high-performing tires is one of the major factors for the growth of the sustainable tire materials market. The market is more on the consolidated side at present, where sustainable tire material manufacturers have been successful to a certain extent in strengthening their market position in the global market, with a few sustainable tire material manufacturers developing recovered carbon black, recycled rubber, and sustainable silica for sustainable tires. However, the competition in the market is expected to become intense as the demand for sustainable tire material increases from tire manufacturers to achieve sustainability targets. Moreover, partnerships and collaborations are expected to play a crucial role in strengthening market position over the coming years, with the companies focusing on bolstering their technological capabilities and gaining a dominant market share in the sustainable tire material industry.

Growth/Marketing Strategy: The sustainable tire materials market has been growing at a rapid pace. The market offers enormous opportunities for existing and emerging market players. Some of the strategies covered in this segment are mergers and acquisitions, product launches, partnerships and collaborations, business expansions, and investments. The strategies preferred by companies to maintain and strengthen their market position primarily include partnerships, agreements, and collaborations.

Competitive Strategy: The key players in the sustainable tire materials market analyzed and profiled in the study include multiple sustainable tire material manufacturers and tire manufacturers. Moreover, a detailed competitive benchmarking of the players operating in the sustainable tire materials market has been done to help the reader understand the ways in which players stack against each other, presenting a clear market landscape. Additionally, comprehensive competitive strategies such as partnerships, agreements, and collaborations are expected to aid the reader in understanding the untapped revenue pockets in the market.

Key Market Players and Competition Synopsis

The companies that are profiled have been selected based on inputs gathered from primary experts and analyzing company coverage, product portfolio, and market penetration.

Among the top players profiled in the report, the public companies operating in the global sustainable tire materials market accounted for around 65% of the market share in 2022, while the private companies operating in the market captured around 35% of the market share.

Key Companies Profiled:

Sustainable Tire Material Manufacturers
• Evonik Industries AG
• Solvay
• PPG Industries, Inc.
• LDC-KOREA CO., LTD.
• CONTEC
• Black Bear Carbon B.V.
• GRP LTD.
• SNR Reclamations Pvt. Ltd.
• Genan Holding A/S
• Lehigh Technologies

Tire Manufacturers
• The Goodyear Tire & Rubber Company
• Michelin
• Bridgestone Corporation
• Nokian Tyres plc
• Continental AG

Companies that are not a part of the aforementioned pool have been well represented across different sections of the report (wherever applicable).

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