Apr 19, Colombo: Tire market in Sri Lanka is expected to grow at a compound annual rate of 12% in the next five years a global market research and consulting company said in a recently released market report.
According to TechSci Research report, "Sri Lanka Tire Market Forecast & Opportunities, 2021", tire market in Sri Lanka is forecast to grow at a CAGR of 12.59%, during 2016-2021.
Growth in the market is anticipated on account of rising two-wheeler and three wheeler demand, expanding automobile fleet and favorable fiscal policies.
Moreover, backed by stable business environment, sound economic conditions, and availability of loans at low interest rates and increasing motorization rate in the country, the automotive industry in Sri Lanka is anticipated to grow over next five years, which in turn, is expected to boost demand for tires in the country through 2021, the report says.
In 2014, tire exports from Sri Lanka were around three times the imports. A major share in the country's overall tire exports, was accounted for by OTR tires, followed by commercial vehicle tires, passenger car tires and two-wheeler tires. Whereas, commercial vehicle tires garnered a major share in the overall tire imports, followed by passenger car tires, OTR and two-wheeler tires.
Two-Wheeler tire segment accounted for the largest share in overall Sri Lanka tire market, in comparison with other tire segments, and the market is anticipated to grow further due to rapidly increasing two-wheeler fleet from 2.10 million units in 2010 to 3.36 million units in 2015, exhibiting 9.86% CAGR during 2010-2015. In 2015, motorcycle tires dominated the two wheeler tire market in the country, however, on account of increasing popularity of mopeds among consumers, the market share of motorcycles tires in Sri Lanka two wheeler market is projected to decline by 2021.
CEAT Kelani tires, Global Rubber Industries (GRI) Tires and Faga Tires are few of the major domestic tire manufacturers operating in the Sri Lanka tire market; while a few global brands operating in the country are Goodyear, Bridgestone, MRF Tires, Apollo, etc.
"Sri Lanka's tire market is a totally replacement driven market due to absence of OEMs in the country. However, Volkswagen has established an assembly plant in the country in August 2014 and plans to establish a local production facility in the country in coming years. This is expected to boost tire sales in the country with rising demand for tires from both OEMs and replacement segment." said Mr. Karan Chechi, Research Director with TechSci Research, a research based global management consulting firm monitoring Tire markets in 80 countries.
"Sri Lanka Tire Market Forecast & Opportunities, 2021" has evaluated the future growth potential of Sri Lanka tire market and provides statistics and information on market structure, imports and trends of Sri Lanka tire market. The report intends to provide cutting-edge market intelligence and help decision makers to take sound investment evaluation. Besides, the report also identifies and analyzes emerging trends along with essential drivers, challenges and opportunities available in Sri Lanka tire market.