The document outlines the characteristics, market dynamics, and historical development of the tyre industry in India, which began in 1926 with Dunlop Rubber Ltd. It discusses various products, companies' market shares, growth rates, and external factors such as GST implementation and import impacts on production. The future prospects indicate India is set to become a major player in tyre manufacturing, reaching the third-largest status by 2025.

2. Introduction
 A rubber covering, typically surrounding an inflated inner
tube, placed round a wheel’s rim to form a soft contact
with the road.
 Characteristics
- rolling resistance depends upon its air pressure,
material and width, etc.
- load bearing capacity proportionately to the
weight.
- a grip is the detrimental one due to less material
engaged.
- tyre fitting varies with width of the wheel’s rim.

3. Origin of the Industry Nature of the Industry
 Dates back to 1926,
when Dunlop Rubber
Ltd. setup the first
tyre company in India.
 Then followed by MRF
tyre in 1946.
 Ancillary to the
automobile industry.
 Driven by the
demand and supply
conditions.
 Mainly controlled by
two wheelers and
four wheelers.

4. Major Products
Radial Tyre
Bias Tyre or Cross Ply
 Tube
- tyres having inner
tube in between the rim
and the tyre.
 Tubeless
- tyres work by sealing
the spoke well of the
rim, either spoke or
butyl strip
 Tyres where fabric
cords run from one
bead to another at an
angle with respect to
the central line of the
tyre.

5. Market Share of Companies
28%
27%
13%
12%
8%
4%
4% 3% 1%
MRF
Apollo
JK Tyres
Ceat
BKT
TVS
GoodYear
Falcon
Others

6. Growth Rate & GDP
 Not stable growth.
 In 2015-16 by 4% after 13% in 2014-2015.
 As per ICRA in 2016 - the tyre production was
affected by tyre imports and falling exports.
 But it grew moderately at 3.4% in Q4 FY2017.
 Now registers 1.7% in Q1 2017-18
 The Industry contributes about 7% of India’s
GDP and employs around 19 million people.

7. PEST Analysis
 Political Factors
- custom duty rates high on rubber 20% and 10% tyres
 Economic Factors
- decline in rupee with increase in raw material cost result
in low margins.
 Social Factors
- explosion in the status of the families resulting in more
demand of 2/4 wheelers affecting demand of tyres.
 Technical Factors
- introduction of new technologies in plants require
capacity expansion

8. Porter’s Five Forces
 Threat of Substitutes
- availability of cheaper options around 20-25% of cost.
 Threat of New Entrants
- highly capital intensive with specific level of technological expertise.
 Industry Rivalry Firms
- existence of various established players like MRF, Apollo, CEAT, JK Tyres,
etc.
 Bargaining Power of Suppliers
- low because of 150 days credit and credit being offered at LIBOR (London
Interbank Offered Rate).
 Bargaining Power of Buyers
- OEMs in strong position due to contracts with relative tyre manufacturers
resulting in stable price.

9. Impact of GST
 Benefited from implementation of GST.
 Elimination of complex multi-layered indirect taxation
system.
 GST tax – 28%
 Help in evasion of unfair trade practices and falsification of
costs.
 Increased demand of tyres.

10. Future Prospects
 Exports will account for 26% by 2021.
 India – expected to become 4th largest tyre
manufacturer by 2020 after China, US and Japan.
 India – 3rd largest by 2025.
 Domestic market expected to account for 71% of
total sales by 2021 with overall market size of US $
115 billion.

11. Thank You…