Green Tires Market Size, Share & Trends Analysis Report By Vehicle Type (Light Commercial Vehicles, Passenger Cars), By Application Type (On Road, Off Road), By Region (North America, Europe), And Segment Forecasts, 2024 - 2030

Green Tires Market Size & Trends

The global green tires market size was estimated at USD 124.8 million in 2023 and is projected to grow at a CAGR of 11.9% from 2024 to 2030. The increasing concerns about greenhouse gas emissions and the limited availability of natural resources have prompted the adoption of green tires in vehicles. Incorporating recycled and green materials in tire production, such as plant-based silica and recycled rubber, reduces waste and enhances sustainability. These materials help decrease the reliance on non-renewable resources, minimize waste, and promote a more sustainable manufacturing process in the tire industry. Growing global government initiatives regarding sustainability are fostering market growth. In July 2022, The Union Ministry of Road Transport and Highways of India initiated a regulation for rolling resistance, wet grip, and rolling sound emissions for tires categorized under passenger cars, light trucks, and trucks and buses. This notification aligns India with European standards and focuses on enhancing fuel efficiency, braking performance, and minimizing vehicle noise emissions.

With their enhanced rolling resistance, green tires offer numerous advantages to consumers and the environment. By reducing the energy needed to propel a vehicle forward, these tires contribute to fuel conservation, offering significant cost savings to vehicle owners in the long term and making these tires an attractive option for consumers.

The green tires industry has witnessed significant advancements in research and development to meet the growing demand for sustainable and eco-friendly tire solutions. Tire manufacturers are investing heavily in innovative technologies and materials to improve green tires' awareness, durability, and environmental impact. For instance, in January 2024, Toyo Tires developed a concept tire that utilizes 90% sustainable materials, displaying a significant growth in the tire industry towards environmentally friendly solutions. This innovative design incorporates various sustainable materials, including biomass-derived butadiene rubber, bio-derived polyester fiber, rice husk ash silica, recycled carbon black, biomass-derived styrene-butadiene rubber recycled steel cord, plant-derived oil, and recycled bead wire.

Market Concentration & Characteristics

The green tires industry growth stage is high and the pace of the industry growth is accelerating. The industry is fragmented, with several established tire manufacturers and new entrants competing for market share. These players focus on research and development to innovate and introduce advanced green tire technologies that offer reduced rolling resistance and enhanced sustainability.

Mergers and acquisitions are a common strategy implemented by companies in this industry to extend their product offerings, strengthen their market position, and gain access to new technologies and markets. In May 2023, Yokohama Rubber acquired Trelleborg Wheel Systems, enhancing its position among tire producers in the off-highway tire segment. This acquisition enabled Yokohama Rubber to expand its presence in the sustainable tire market, particularly in the off-highway tire segment, by leveraging Trelleborg's expertise and product portfolio in eco-friendly and energy-efficient tire solutions.

With increasing competition among tire manufacturers, offering eco-friendly options has become a way to differentiate products. Companies invest in research and development to create innovative, eco-friendly tire solutions that meet consumer demands.

Vehicle Type Insights

The passenger car segment held the largest market share of 62.4% in 2023. Tire manufacturers increasingly focus on sustainable materials such as natural rubber from sustainable plantations, bio-based materials, and recycled rubber to reduce reliance on non-renewable resources and minimize waste. This shift aligns with consumer preferences for environmentally friendly products in passenger cars.

The light commercial vehicles segment is anticipated to grow significantly over the forecast period. Integrating green tires in light commercial vehicles offers enhanced traction, braking capabilities, extended tread life, and stability on various road surfaces. The improved performance characteristics contribute to overall driver safety and vehicle handling, making green tires a preferred choice for businesses prioritizing safety in their operations.

Application Type Insights

On road type segment held the largest revenue share in 2023. Integrating green tires into on road vehicles can significantly boost sustainability efforts and environmental impact. Enhanced compounds in green tires ensure even road pressure distribution, reducing tread wear and increasing tire lifespan to minimize waste. Installing green tires in EVs can maximize range efficiency by reducing rolling resistance, which leads to more distance between charges. In October 2022, Michelin launched two types of tires for on-road use that incorporate 45% and 58% sustainable materials. These tires contain recycled carbon black, oils like sunflower oil and bio-sourced resins, silica from rice husks, and recycled steel. This innovation highlights Michelin's high-tech materials expertise and commitment to sustainability.

Off road segment is anticipated to witness the fastest CAGR over the forecast period. Continuous advancements in tire technology have led to developing green tires specifically designed for off-road applications in the construction, mining, and agriculture industries. These tires provide superior performance and contribute to reduced fuel consumption and carbon emissions, making them a preferred choice for off-road vehicle manufacturers and operators. In November 2022, GRI, a radial agriculture tire manufacturer, launched the Green XLR Earth 65+. It incorporates 37.5% environment-friendly materials and features a unique tread design that creates a virtual rib. This design enhances driving comfort and improves steering precision at higher speeds.

Regional Insights

North America is expected to witness significant growth over the forecast period. There is a growing awareness among consumers in North America regarding environmental issues and sustainability. As more individuals become conscious of pollution and climate change and seek ways to reduce it, there is a rising demand for products that align with these issues. Green tires, known for their contribution to fuel efficiency and reduced emissions, are gaining popularity among environmentally conscious consumers.

U.S. Green Tires Market Trends

The U.S. held the largest market share in 2023. The U.S. market presents significant growth opportunities for automotive green tires due to increasing car ownership and a growing focus on environmental issues. Companies are establishing a solid base by providing cost-effective and eco-friendly tire solutions tailored to the demands of American consumers. For instance, in January 2022, Goodyear Tire made significant developments in sustainable tires, unveiling a demonstration tire of 90% sustainable materials. This tire has passed all regulatory and internal testing and offers better fuel savings and carbon footprint reduction due to its lower rolling resistance than traditional tires.

Asia Pacific Green Tires Market Trends

The Asia Pacific region held the largest market share of 39.8% in 2023. Stringent regulations and policies aimed at promoting energy efficiency and reducing carbon footprint are driving the adoption of green tires in the Asia Pacific market. Governments in countries including China, Japan, South Korea, and India are implementing fuel efficiency standards and emission regulations for vehicles to address environmental challenges and achieve sustainability goals. These regulations incentivize automakers to prioritize using green tire technologies to meet compliance requirements and reduce the environmental impact of their fleets. As a result, the demand for green tires is expected to grow as vehicle manufacturers seek to comply with regulatory mandates and improve the environmental performance of their vehicles.

The China green tires market held the largest market share in 2023. With the increasing popularity of electric vehicles in China, there is a growing demand for eco-friendly parts, including tires. Consumers are becoming more environmentally conscious and are seeking products that align with their sustainability goals.

The green tires market in India is expected to witness the fastest growth over the forecast period. The automotive industry in India is experiencing significant growth, with an increasing number of vehicles. As the automotive sector expands, there is a parallel increase in the demand for tires. Green tires, emphasizing fuel efficiency and sustainability, are well-positioned to tackle this increasing demand. In April 2023, JK TYRE & INDUSTRIES LTD launched a new tire using sustainable and recycled materials named the UX Green tyre. This tire has 80% sustainable materials, including natural rubber, recovered carbonaceous black, recycled polyester, steel wire bio-based oil, and recycled rubber powder. The UX Green tyre offers high performance comparable to a standard radial tire and has been tested extensively indoors and outdoors to validate its performance.

Europe Green Tires Market Trends

Europe is expected to witness significant growth over the forecast period. Due to fluctuating fuel prices and growing concerns about energy efficiency, European consumers are focusing on reducing vehicle operating costs. Green tires improve fuel efficiency due to reduced rolling resistance and offer long-term cost savings to vehicle owners and fleet operators. The potential for lower fuel consumption and maintenance costs makes green tires an attractive option in the European market.

Key Green Tires Company Insights

Some of the key players operating in the green tires market include The Goodyear Tire, MICHELIN, and Nokian Tyres plc among others.

• Goodyear is a tire manufacturer that operates in most regions of the world. It focuses on reducing energy consumption and emissions in its factories and utilizing renewable energy sources. It also uses sustainable material sources, develops alternatives such as green tires, and aims to create 100% sustainable material tires by 2030.
• The MICHELIN Group is a global company headquartered in France and delivers tires to over 170 countries. MICHELIN is strongly committed to innovation and sustainable development for the mobility of people and goods. MICHELIN manufactures tires for various applications, including space shuttles, aircraft, automobiles, heavy equipment, motorcycles, and bicycles.

Recent Developments

• In June 2023, GRI launched the GREEN XLR Earth Series tires, which have demonstrated impressive performance in the past six months of testing in Germany. These tires are created to transform the industry by incorporating a remarkable 78.6% of sustainable materials, including ethically sourced natural rubber from Sri Lankan farms. The Earth Series by GRI minimizes the carbon footprint and offers exceptional performance and longevity.

• In May 2023, Kumho Petrochemical and Hankook Tire collaborated to develop green tires using eco-solution-polymerized styrene-butadiene rubber. This rubber utilizes recycled styrene monomer to improve fuel efficiency and tire wear resistance. This collaboration involves Hankook testing and evaluating its tires to determine their performance qualities and physical properties.

• In March 2023, Nokian Tyres announced an expansion initiative in Tennessee, which entails the establishment of a 600,000-square-foot tire warehouse. This move aims to bolster the company's existing nine-warehouse network throughout the U.S. and Canada, enabling it to achieve a maximum production capacity of up to four million tires annually by 2024.

• In June 2022, Michelin and Hyundai Motor Group announced a partnership to develop next-generation tires for premium electric automobiles. The partnership aims to create eco-friendly tires by increasing the use of sustainable materials optimized for next-generation electric automobiles and real-time tire monitoring systems. The partnership was also aimed at analyzing tire wear, road friction, and tire load beyond current standards and enhance ride comfort by decreasing vibration and noise generated by EVs at high speeds.

• In May 2022, Goodyear launched its first city transit tires made with a sustainable soybean oil compound. These tires incorporate soybean oil to replace petroleum-based materials, reducing the environmental impact of tire production while maintaining performance benefits. Using soybean oil in these tires marks a significant step towards sustainability in the tire industry, aligning with Goodyear's commitment to developing eco-friendly and high-performance tire solutions.

Green Tires Market Report Scope

Global Green Tires Market Report Segmentation

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2018 to 2030. For this study, Grand View Research has segmented the global green tires market report based on the vehicle type, application type, and region:

• Vehicle Type Outlook (Revenue, USD Million, 2018 - 2030)

  • Light Commercial Vehicle

  • Passenger Cars

  • Heavy Trucks

  • Buses & Coaches

• Application Type Outlook (Revenue, USD Million, 2018 - 2030)

  • On Road

  • Off Road

• Regional Outlook (Revenue, USD Million, 2018 - 2030)

  • North America

    • U.S.

    • Canada

    • Mexico

  • Europe

    • France

    • Germany

    • Italy

    • Spain

    • UK

  • Asia Pacific

    • China

    • India

    • Japan

    • South Korea

  • Central & South America

    • Brazil

  • Middle East & Africa

    • Saudi Arabia

    • UAE