Brazil Tire Market to Grow at 6.29% CAGR by 2026

2016–2026 Brazil Tire Market Forecast and Opportunities Published On: August 2021 www.techsciresearch.com MARKET INTELLIGENCE. CONSULTING

Table of Contents S. No. Contents 1. Product Overview 2. Research Methodology 3. Executive Summary 4. Impact of COVID-19 on Brazil Tire Market 5. Voice of Customer 5.1. Brand Recall (Aided and Unaided) 5.2. Factors Influencing Purchase Decisions 5.3. Brand Satisfaction Level (By Lifetime and By Traction) 6. Brazil Tire Market Outlook, 2016-2026 6.1. Market Size & Forecast 6.1.1. By Value & Volume 6.2. Market Share & Forecast 6.2.1. By Vehicle Type (Passenger Car, Two-Wheeler, LCV, M&HCV, and OTR) 6.2.2. By Tire Construction Type (Radial vs Bias) 6.2.3. By Demand Category (OEM vs Replacement) 6.2.4. By Sales Channel (Online vs Offline) 6.2.5. By Region Automotive © TechSci Research 2

Table of Contents S. No. Contents 6.2.6. By Company (2020) 6.3. Prominent Tire Sizes 6.4. Market Map 7. Brazil Passenger Car Tire Market Outlook, 2016-2026 7.1. Market Size & Forecast 7.1.1. By Value & Volume 7.2. Market Share & Forecast 7.2.1. By Vehicle Type (SUV, Sedan, and Hatchback) 7.2.2. By Tire Construction Type 7.2.3. By Demand Category 8. Brazil Two-Wheeler Vehicle Tire Market Outlook, 2016-2026 8.1. Market Size & Forecast 8.1.1. By Value & Volume 8.2. Market Share & Forecast 8.2.1. By Vehicle Type (Motorcycle and Scooter/Moped) 8.2.2. By Tire Construction Type 8.2.3. By Demand Category Automotive © TechSci Research 3

Table of Contents S. No. Contents 9. Brazil LCV Tire Market Outlook, 2016-2026 9.1. Market Size & Forecast 9.1.1. By Value & Volume 9.2. Market Share & Forecast 9.2.1. By Vehicle Type (Pickup Truck, Van, Light Truck, and Light Bus) 9.2.2. By Tire Construction Type 9.2.3. By Demand Category 10. Brazil M&HCV Tire Market Outlook, 2016-2026 10.1. Market Size & Forecast 10.1.1. By Value & Volume 10.2. Market Share & Forecast 10.2.1. By Vehicle Type (Truck and Bus) 10.2.2. By Tire Construction Type 10.2.3. By Demand Category 11. Brazil OTR Tire Market Outlook, 2016-2026 11.1. Market Size & Forecast Automotive © TechSci Research 4

Table of Contents S. No. Contents 11.1.1. By Value & Volume 11.2. Market Share & Forecast 11.2.1. By Vehicle Type (Agriculture Vehicle, Mining, Construction & Industrial Vehicle, and Others) 11.2.2. By Tire Construction Type 11.2.3. By Demand Category 12. Import and Export Analysis 13. Market Dynamics 13.1. Drivers 13.2. Challenges 14. Market Trends and Developments 15. Price Matrix 16. Policy & Regulatory Landscape 17. Brazil Economic profile 18. Competitive Landscape 18.1. Pirelli Pneus SA 18.2. Michelin Pneus 18.3. Bridgestone Americas Tire Operations, LLC Automotive © TechSci Research 5

Table of Contents S. No. Contents 18.4. The Goodyear Tire & Rubber Company 18.5. Continental AG 18.6. Rinaldi Tires 18.7. Maggion Industrias de Pneus e Maquinas Ltda. 18.8. Maxxis International 18.9. Kenda Rubber Industrial Company, LTD. 18.10. TECHNIC TIRES 19. Strategic Recommendations 20. About Us & Disclaimer Automotive © TechSci Research 6

PRODUCT OVERVIEW

Scope of Report Product of Interest (POI): Tire Tire is a ring like component that encircles the vehicle’s rim and meets the ground. Tires are filled with compressed air to provide a gripping surface for traction on the surface over which the vehicle travels. Most vehicles are equipped with pneumatic tires where air is held under pressure inside the tire. Since tire creation, natural rubber is extensively used in fabrication of tires, nevertheless modern tires make use of materials like synthetic rubber, fabric, steel wires, carbon black, etc. adding advanced characteristics to a tire. Market Segmentation VEHICLE TYPE TIRE TYPE • Passenger Car • Radial Year Range BRAZIL TIRE MARKET • Light Commercial • Bias Vehicle (LCV) Review Period • Medium and Heavy SALES CHANNEL Commercial Vehicle • Offline 2016 – 2019 (M&HCV) • Online Base Year • Off the Road (OTR) 2020 • Two-Wheeler Estimated Year DEMAND CATEGORY REGION 2021 • OEM • South-East • South Forecast Period • Replacement 2022 – 2026 • North-East • Mid-West • North 8 Automotive © TechSci Research 8

Scope of Report Product of Interest (POI): Tire By Vehicle Type: ❑ Passenger Car Tires: Tires that are designed for vehicles like hatchbacks, sedans, coupes, and crossovers fall under passenger car tires. Tread is the outer part of a tire that makes direct contact with the ground. The tread band embodies a grooved section on top of a base, and majority of passenger car tire grooves starts out 9/32 to 13/32 inch deep. Passenger car tires are equipped with two steel belts that are used to provide strength and stability to the tread area. ❑ Commercial Vehicle Tires: Commercial vehicle tires include tires for Light Commercial Vehicles (LCVs) & Heavy and Medium Duty Commercial Vehicles. Vehicles like work vans, larger pickup trucks, buses and coaches, sizeable trucks that are designed to regularly carry heavy loads or pull heavy trailers fall under commercial vehicles. Mostly, medium truck and bus tires have four steel belts. Doubling of the steel belts makes the vehicle tire more robust and durable. Mostly, commercial vehicle tire grooves are 20/32 inch deep, double of passenger car tires. ❑ Off-the-Road Tires: These tires are designed to travel on unpaved surfaces, muddy regions, loose dirt, sand or gravel, rock, snow etc., where factors like off-road grip, puncture resistance, and vehicle load ratings comes into play. These tires have custom designed tread patterns, and the grooves between the tread blocks are wide. OTR tire are styled with reinforced sidewalls to provide higher resistance to punctures. These tires have reduced patch area in order to have less contact with the road surface during wheel rotation, however the reduced grip dips the fuel efficiency of the vehicle. OTR tires include tires of all terrain vehicles (ATVs), mining equipment, construction machinery, etc. These tires have shorter tread life as compared to passenger car tires. ❑ Two-Wheeler Tires: Tires used in motorised two-wheelers like motorcycles, mopeds and scooters are classified under Two-Wheeler Tires. These tires are light in weight compared to other types of tires like passenger car tires and are equipped with an aim of steering, braking, handling, absorbing road undulations and carrying the load of the rider and passenger. Broadly there are two types of two-wheeler tires, tubeless and tube-type tires, where tubeless tires are fitted with alloy wheels and tube-type tires are predominantly used on spoked steel rimmed wheels. 9 Automotive © TechSci Research 9

Scope of Report Product of Interest (POI): Tire By DemandCategory: ❑ OEM: Original Equipment Manufacturer (OEM) tires, also called stock tires are those type of tires that are specified by the vehicle manufacturer and come fitted from the factory with the purchased vehicle. These types of tires are selected by the automotive manufacturer to meet the ideal performance requirements for their brand-new vehicle. Predominantly OEM tires are not custom fitted to meet the user's requirements but are designed with a focus to provide fuel efficiency, comfort, and better road handling capabilities. ❑ Replacement: Replacement tires commonly known as aftermarket tires are those types of tires that consumers purchase for replacing the company fitted OEM tires. Replacement tires overcome the limitations of OEM tires, by giving the consumer an option of customizing the vehicle to benefit his or her needs for superior driving experience over comfort. By Tire Construction Type: ❑ Radial: The radial wheel is a specific design of a vehicular tire. In this design, the roots of the ropes are rotated 90 degrees to the point of travel, or radially. Radial wheels have flexible sidewalls, low fuel consumption, long tread life, stable road connectivity, reduced maintenance of equipment, etc. ❑ Bias: A bias tire consists of multiple rubber plies over-lapping each other. The crown and sidewalls are interdependent. The overlapped plies form a thick layer that is less flexible and more sensitive to overheating. By Sales Channel: ❑ Online: Owing to rising internet penetration, tires are being sold through e-commerce portals like TireShop.com, Pneufree.com or company websites, etc. Tire sales through online channel is backed by various benefits such as brand and price comparison, fast delivery and high discount offers. ❑ Offline: Tire sales through tire distributor sales outlet, company stores, automotive retail shops, etc. are being classified under the offline mode of sales channel. 10 Automotive © TechSci Research 10

RESEARCH METHODOLOGY

Research Methodology Market Profiling •In-depth secondary research was conducted to determine top players in the Brazil Tire market, Data Data Filter Research & Actionable Business overall market size and segmental market size. Collection & Analysis Intelligence Insights Solution Formulating Questionnaire •In order to conduct industry experts’ interviews, TechSci formulated a detailed questionnaire. ❑ Identifying Key Opinion Leaders Developing List of Respondents ❑ Questionnaire Design ❑ In-depth Interviews A ❑ Recent •List of industry players and industry specialists Primary Developments was developed. Research B ❑ Market Changing Aspects/Dynamics Desk ❑ Government Data Collection C Research Policies Company ❑ Final Conclusion •TechSci conducted interviews with industry ❑ Market Participants Analysis experts and industry players for data collection ❑ Key Strengths and verification. Data Validation •Data obtained as a result of primary and Primary Secondary Paid Sources secondary research was validated through Research Research rigorous triangulation. ❑ LinkedIn ❑ Company Website ❑ Factiva ❑ TechSci Internal ❑ Company Annual ❑ Hoovers Database Reports Data Analysis ❑ White Paper Study ❑ Financial Reports ❑ Investor •The data was scrutinized using MS-Excel and Presentations statistical tools, such as Time Series Analysis, ❑ Regulatory Body ❑ Associations, etc. etc. to obtain qualitative and quantitative insights about the Brazil Tire market. 12 Automotive © TechSci Research 12

Research Methodology Baseline Methodology: For the study, TechSci Research gathered information through primary research surveys with leading tire OEMs operating across the country. We also put through an exhaustive search of credible paid databases, such as Business Week, Factiva, Hoovers, etc., including our internal database. Our team of analysts has then prudently evaluated all the collected information and presented the same in chronological order to depict a meaningful and clear picture of the Brazil Tire market. While compiling the data, we have also cross checked all the collected information from multiple sources and data warehouses, so as to present the most accurate and precise information of the concerned industry. All the data representation done here is in calendar year period, starting from 1st January 2020 to 31st December 2020 until mentioned otherwise. Primary Research – Partial List of Companies Interviewed Few Sources of Secondary Research S. No. Company/Dealers & Distributor Names S. No. Secondary Sources 1. Pirelli Pneus SA 2. Michelin Pneus 1. OICA 3. Bridgestone Americas Tire Operations, LLC 2. World Bank 4. The Goodyear Tire & Rubber Company 5. Continental AG 3. Abraciclo 6. Rinaldi Tires 7. Maggion Industrias de Pneus e Maquinas Ltda. 4. Industry Magazines 8. Maxxis International 5. Credible Paid Database 9. Kenda Rubber Industrial Company, LTD. 10. TECHNIC TIRES 13 Automotive © TechSci Research 13

Research Methodology Tire Production TechSci Research has mapped production capacities of almost all tire manufacturing facilities in Brazil, with the help of a series of primary research surveys of all the major tire manufacturing companies in the country, followed by validation through secondary sources such as company annual reports and industry associations. TechSci Research has been successful in identifying the production capacities of each tire plant as well as their respective plant locations, establishment dates and type of tires manufactured. Vehicle Production, Sales & Fleet Size Basic data points needed for analysis of Brazil Tire market are the historical, current and forecast figures for vehicle production, sales and fleet size. Data for vehicle sales and fleet size has been extracted through various secondary sources and credible data portals. TechSci Research has also maintained a database for vehicle sales and fleet size for two-wheelers, which is regularly updated through various primary research surveys and secondary sources such as tire associations & government publications. Tire Demand OEMTireSales OEM tire demand has been calculated by multiplying the average number of tires per vehicle to the total number of vehicles produced. For example, for two-wheeler segment, the average number of tires is considered to be two and for passenger cars, the average number of tires is five. 14 Automotive © TechSci Research 14

Research Methodology ReplacementTireSales Replacement tire demand of a particular country is directly dependent on the country’s vehicle fleet size and historical vehicle sales. Replacement tire demand is calculated by multiplying vehicle fleet with replacement tire ratio, which is obtained by conducting a series of surveys with car owners to understand the frequency of tire replacement, as it varies for different countries depending upon the country’s road conditions, climate, economic and regulatory policies, etc. The replacement ratio is expressed as a percentage. For example, in case of two-wheeler, replacement ratio is considered to be 100% if two tires are replaced per vehicle per year. For instance, for passenger car replacement tire demand calculation: Two-wheeler Fleet X Replacement Ratio X No. of Tires = Replacement Size (Volume) (%) Tire Demand 100,000 X 19% X 2 = 38,000 Tires The calculated replacement tire demand data is further analyzed by TechSci Research through Delphi technique, i.e., multiple rounds of telephonic interviews with tire companies/dealers in Brazil. The information collected is then cross-verified through industry experts and secondary sources, such as annual reports and paid databases to generate meaningful results. Total Tire Market Forecast OEM Tire Sales + Replacement Tire Sales = Total Tire Market Forecast For forecasting the numbers, we have used time series analysis along with regression analysis, followed by judgmental analysis. 15 Automotive © TechSci Research 15

Industry Brief According to TechSci Research report, “Brazil Tire Market By Demand Category (OEM, Replacement), By Vehicle Type (Passenger car, LCV, M&HCV, Two- Wheeler, OTR), By Construction Type (Radial and Bias), By Sales Channel (Offline and Online), By Region (South East, South, North East, Mid-West and North) Competition, Forecast & Opportunities, 2026”, Brazil tire market is anticipated to reach USD8.63 billion at a CAGR of 6.29% by 2026 because of increasing fleet size of vehicles which is boosting the after-market demand for tires in Brazil. The increase in per capita income has resulted in an increase in purchasing power as well as a rise in the population's standard of living. This is resulting in growth of vehicle sales as well as expansion of fleet size, leading to growth in the replacement demand for tires in Brazil. Also, high replacement rate is being witnessed due to poor infrastructure in rural areas across the country. Whenvehicles are driven on poor roads, tires’ tread wears down quickly, resulting in increased aftermarket tire demand in the region. An increasing number of new models of cars are being launched due to high interest and preference among the Brazilian citizens. Consequently, various passenger car manufacturers are emphasizing the introduction of new models with enhanced safety features. The demand for passenger cars is going to remain high in the near future, which is expected to further boost the demand for tires in Brazil through 2026. However, during the COVID-19 outbreak, which led an economic crisis in 2020, the country's automotive sales plummeted considerably. However, after the long and hugely negative effect of COVID-19 lockdown, the tire market has again gained some pace in Brazil. Following a significant reduction in production and sales in recent months, vehicle production has resumed, with sales also rising up, resulting in increased demand for tires in the OEM category. Increased tire sales via e-commerce websites are also helping the tire market to develop after the COVID-19 outbreak. Brazil tire market can be segmented based on demand category, by vehicle type, by construction type, by sales channel, and by region. On the basis of demand category, replacement tires dominate the overall Brazil tire market with more than 4/5th of the total market share. Owing to the increasing fleet size of the vehicle, it is expected that the trend will be the same in near future as well. On the basis of vehicle type, passenger car tires are leading the Brazil tire market with more than half of the total market followed by LCV, M&HCV, Two-Wheeler and OTR. In the forecast period, it is expected that passenger car tires will be consumed more than any other, but two-wheeler tires will increase at a higher CAGR in comparison to other vehicle types. On the basis of construction type, radial tires are dominating in Brazil tire market over bias tire with almost 3/4th of the total share. This is mainly due to high consumption in passenger cars and becauseof increasing fleet of passenger cars it is expected that it will dominate the market in future also. Pirelli Pneus SA, Michelin Pneus, Bridgestone Americas Tire Operations, LLC, The Goodyear Tire & Rubber Company are among some of the leading players operating in the Brazil tire market. Apart from these companies, Continental AG, Rinaldi Tires, Maggion Industrias de Pneus e Maquinas Ltda., Maxxis International, Kenda Rubber Industrial Company, LTD., and Technic Tires. are the key players developing advanced technologies and launching new products to stay competitive in the market. Other competitive strategies include mergers and acquisitions, new product developments and also increase their marketing activities and enrich the product portfolio across the country to increase their customer outreach. “In 2020, passenger car tires accounted for the largest share, i.e., 61.45% in Brazil tire market and it is expected to dominate in the forecast period as well. In the forecast period also, it is expected that passenger car tires will dominate because of increasing sales and growing fleet size of passenger cars in Brazil.”, said Mr. Karan Chechi, Research Director with TechSci Research, a research based global management consulting firm. Automotive © TechSci Research 16

Sample Data -Snapshot Brazil Tire Market Size, By Value (USD Billion), By Volume (Million Units), 2016-2026F CAGR 2016-2020 CAGR 2021E-2026F By Value: xx% By Value: xx% By Volume: xx% By Volume: xx% 10.00 100.00 9.00 90.00 8.00 80.00 7.00 70.00 6.00 60.00 5.00 50.00 4.00 40.00 3.00 30.00 2.00 20.00 1.00 10.00 0.00 - 2016 2017 2018 2019 2020 2021E 2022F 2023F 2024F 2025F 2026F Value (USD Billion) Volume (Million Units) Brazil Passenger Car Tire Market Share, By Vehicle Type, By Volume, 2016–2026F 2016 2017 2018 2019 2020 2021E 2022F 2023F 2024F 2025F 2026F Hatchback 20.00% 20.00% 20.00% 20.00% 20.00% 20.00% 20.00% 20.00% 20.00% 20.00% 20.00% Sedan 30.00% 30.00% 30.00% 30.00% 30.00% 30.00% 30.00% 30.00% 30.00% 30.00% 30.00% SUV/MPV 50.00% 50.00% 50.00% 50.00% 50.00% 50.00% 50.00% 50.00% 50.00% 50.00% 50.00% Brazil OTR Tire Market Share, By Tire Construction Type, By Volume, 2016–2026F 2016 2017 2018 2019 2020 2021E 2022F 2023F 2024F 2025F 2026F Bias 40.00% 40.00% 40.00% 40.00% 40.00% 40.00% 40.00% 40.00% 40.00% 40.00% 40.00% Radial 60.00% 60.00% 60.00% 60.00% 60.00% 60.00% 60.00% 60.00% 60.00% 60.00% 60.00% Automotive © TechSci Research 17

Report Ordering Report Name: Brazil Tire Market Forecast and Opportunities 2016–2026 License Type Price Single User License $3500 Multi-User License $4500 Custom Research License $7500 To View Sample OR Purchase Report Automotive © TechSci Research 18

About Us & Disclaimer TechSci Research is a global market research and consulting company with offices in the US, UK and India. TechSci Research provides market research reports in numberof areas to organizations. The company uses innovative business models that focus on improving productivity, while ensuring creation of high-quality reports. The proprietary forecasting models use various analyses of both industry-specific and macroeconomic variables on a state-by-state basis to produce a unique ‘bottom-up’ model of a country, regional and global industry prospects. Combined with the detailed analysis of company activity and industry trends, the result is a uniquely rich evaluation of the opportunities available in the market. Related Reports • Mexico OTR Tire Market, By Application Type (Agriculture, Construction, Mining, Material Handling, Ports, Forestry), By Demand Category (Replacement, OEM), By Rim Size (Up to 25’’, Above 25”), By Tire Construction (Radial, Bias), By Company and By Region, Competition Forecast & Opportunities, 2026 • Philippines Tire Market By Vehicle Type (Two-Wheeler, Commercial Vehicle and Passenger Car), By Demand Category (Replacement and OEM), By Region, Competition Forecast & Opportunities, 2026 • Saudi Arabia Tire Market By Vehicle Type (Passenger Car, LCV, M&HCV, OTR, and Two-wheeler), By Radial Vs Bias, By Online vs Offline Sales Channel, Competition, Forecast & Opportunities, 2026 TechSci Research – North America TechSci Research – Europe TechSci Research – Asia-Pacific 708 Third Avenue, Manhattan, 54, Old brook, Bretton, B – 44, Sector – 57, Noida, National Capital New York, United States Peterborough, Region, U.P. - India Tel: +1- 646- 360- 1656 United Kingdom Tel: +91-120-4523900 Email: [email protected] Email: [email protected] Email: [email protected] www.techsciresearch.com www.techsciresearch.com www.techsciresearch.com Disclaimer The contents of this report are based on information generally available to the public from sources believed to be reliable. No representation is made that it is timely, accurate or complete. TechSci Research has taken due care and caution in compilation of data as this has been obtained from various sources including which it considers reliable and first hand. However, TechSci Research does not guarantee the accuracy, adequacy or completeness of any information and it is not responsible for any errors or omissions or for the results obtained from the use of such information and especially states that it has no financial liability whatsoever to the subscribers / users of this report. The information herein, together with all estimates and forecasts, can change without notice. All the figures provided in this document are indicative of relative market size and are strictly for client’s internal consumption. Usage of the same for purpose other than internal will require prior approval of TechSci Research.