Economy, Business And Markets

Iran Tire Market Forecast to Grow at 12% CAGR by 2021

Iran Tire Market Forecast to Grow at 12% CAGR by 2021Iran Tire Market Forecast to Grow at 12% CAGR by 2021

The anticipated economic revival due to lifting of sanctions by the western countries, coupled with expanding automotive fleet, will drive sales of tires in Iran, a recent report by Canada-based market research and consulting service provider TechSci Research said.

According to the “Iran Tire Market Forecast & Opportunities, 2021”, Iran’s tire market is likely to grow at a CAGR of over 12% during 2016-21, the group said in a press release posted on its website.

Below is the full text of the release:

The growth anticipated in automobile production and sales is one of the major factors boosting tire sales over the next five years in the country. Moreover, lifting of sanctions by the western countries and the anticipated economic revival will augment demand for tires in the country through 2021.

The UN Security Council and P5+1 nations (China, France, Russia, the United Kingdom and the United States, plus Germany) imposed various sanctions on the country after Iran refused to suspend its uranium enrichment program. Freedom to export and import automobiles and tires was restricted for Iran with the imposition of these sanctions.

However, due to multilateral talks between Iran and P5+1 nations, most of the sanctions on the country have been lifted and a Joint Comprehensive Plan of Action was signed by both the sides in July 2015. This move is expected to boost the tire market in Iran in the coming years.

In Iran, the construction sector is forecast to grow during 2016-21, which is being backed by various major projects slated for completion in the coming years and having a cumulative worth of $200 billion. Moreover, housing demand in the country is forecast to reach 1.2 million units by 2020.

Besides, the country’s motorization rate, which stood at 170 vehicles per 1,000 individuals in 2014, is expected to grow in the coming years, with the overall automobile fleet in the country having increased at a CAGR of 5.75% during 2010-14. All these factors are expected to positively influence tire market in Iran over the next five years.

“Barez, Goldstone, Yazd and Kavir are few of the major domestic tire manufacturing companies, while Hankook, Kumho, Continental, Bridgestone and Michelin are the major global tire companies operating in Iran.

Owing to restrictions on the operations of various major international tire brands in Iran, domestic tire brands dominated the country’s tire market during 2011-15,” said Karan Chechi, Research Director with TechSci Research.

“However, with the lifting of sanctions, various global companies are planning to enter or reenter the country’s tire market, which is a huge positive for the country’s automobile industry, including the tire market.”