Saudi Arabian tyre market predicted to grow 12% CAGR by 2018
A new report published by Bharrat Books predicts that the Saudi Arabian tyre market revenues will grow 12 per cent compound annual growth rate (CAGR) during the period between 2013 and 2018.
According to the report, the continuous increase in the demand for automobiles along with the shorter tyre replacement cycle will drive the tyre industry in the country during the forecasted period. The passenger car tyre segment dominates the tyre market in Saudi Arabia, followed by the commercial vehicle tyre segment. The growing industrialization and increasing investments in the country are further likely to push the demand for automobiles and tyres in Saudi Arabia over the next five years. In addition, the demand for tyres is also increasing due to foray of technologically improved tyres, which provide more fuel efficiency and vehicle safety.
Saudi Arabia is one of the largest and strongest automotive markets in Middle Eastern region. Nevertheless there is negligible domestic production of automobiles in the country, the vehicle sales are increasing at a strong pace, mainly driven by the imports which in turn have resulted in huge demand for automotive aftermarket products such as Tyres. Global tyre companies such as Yokohama, Bridgestone, Hankook, and Michelin are the leading players in Saudi Arabia’s tyre market and are operating in the country through their authorized distributors/importers.
However, what the report overlooks is the very significant role of large UAE-based wholesale tyre distribution operations, which often have close relationships with Chinese tyre manufacturers as well as some of the better known brand names.