Tyre industry bullish on growth, exports up 12% in H2 FY24, say tyre makers

The Automotive Tyre Manufacturers’ Association (ATMA) foresees strong growth for India’s tyre industry in the long term, given the rise in domestic and overseas markets, coupled with the government’s continued investment in infrastructure.

Arnab Banerjee, the newly elected Chairman, said the industry is looking at doubling its turnover from ₹1 lakh crore in the next 10 years, especially given that Indian tyres have a market in over 170 countries.

Quoting Commerce Ministry data, he said tyre exports made a sharp recovery in the second half of FY2023-24, and went up by 12 per cent in value terms. In the first half, tyre exports were severely impacted and declined by 11 per cent in view of the slowdown in advanced economies, geopolitical uncertainties and inflationary pressures.

Total tyre exports during FY2023-24 stood at ₹23,073 crore, matching the previous year’s figure of ₹23,125 crore. The figures have nearly doubled in the last four years (FY20-FY24) to touch ₹23,073 crore from ₹12,844 crore, despite a slew of domestic and external challenges. 

The US continues to be the largest market for Indian tyres, accounting for 18 per cent of total tyre exports from India in FY24. The top five export markets for Indian manufactured tyres in FY24 included the US, Germany, Brazil, France, the Netherlands, Italy and the UAE.

The tyre industry has the potential of significantly increasing exports if certain roadblocks, especially with regard to accessing Natural Rubber (NR) are removed. The tyre industry needs to adhere to the pre-import condition for NR imports, against the (tyre) export obligation. This restricts operations and affects export performance, he said.

The export obligation period, which was reduced from 18 to 6 months a while ago, should be restored to 18 months. Accessing raw material, which is in short supply domestically, was difficult in the shorter export obligation period (for tyres).

ATMA said these restrictions had not benefitted the growers /NR producing interests, but have had an adverse fallout on NR consuming interests, both tyre and non-tyre sectors, especially by way of inhibiting export of rubber goods from India.

The tyre industry also invested an estimated ₹23,000 crore in greenfield and brownfield capacities in the last 3-4 years, and is ahead of the demand curve in meeting both domestic and export demand), he added.



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