The Saudi Arabia OTR Tire Market is growing
because of developments in infrastructure and construction sector in the country,
growth is also being fueled by the creation of smart cities in the country and
the implementation of initiatives such as the National Industrial Development
and Logistics Program (NIDLP) is expected to support the Saudi Vision 2028. All
the infrastructural developments in the country is expected to drive the OTR
tire market in Saudi Arabia.
Recent Developments
The growth in the OTR
tire industry in Saudi Arabia is because of the rise in the developments in the
infrastructure projects. The country is also attracting investments from the
foreign investors and the government policies to switch from oil-based economy
is also attracting investments in this area and this is leading to the rise in
the utilization of the commercial vehicles and in the replacement rate of the
tires, especially the OTR tires. Development projects such as Riyadh metro, Makkah
Public Transport Program, Al Widyan, Jabal Omar, Diriyah Gate Project, SEDRA
Community Home, Al Faisaliah Economic City etc.
As the commercial
vehicle utilization will increase in the coming years, the replacement rate
will increase. Saudi Arabia tire market is import driven as the country does
not manufacture tire and the ease in the trade regulations will also help tire
companies to easily import tires to Saudi Arabia. One of the most significant
market trends is the rising acceptance of tire retreading, particularly in OTR
tires. OTR tire market in Saudi Arabia accounts for the highest share of
overall retread tire market in the country. Another significant trend in
the market is an increased emphasis on technological advancement. High-tech
tires for automobiles are becoming a growing area of focus for tire
manufacturers in Saudi Arabia. Several tire manufacturers are developing their
technologically advanced new tire offerings to meet changing customer demand
for better ride comfort, safety, higher fuel efficiency, and durability.
A
further trend in the market is a shift toward online tire sales. Consumers
benefit from an increase in e-commerce and online sales because it gives them
more options for products to buy. Customers can compare different tire brands,
as well as the costs, quality, and specifications of related goods. Overall,
the ease in the trade regulations and increase in the infrastructural projects is
expected to drive the growth of the Saudi Arabia OTR Tire Market.
Increasing Infrastructural Investments
The automobile industry in Saudi
Arabia is expanding at an impressive rate, with demand rising across the
board for all types of vehicles. The utilization of vehicles has increased
because of the nation's ongoing infrastructure projects, and this has all contributed
to an increase in tire demand there. Due to the growing number of
infrastructure and construction projects underway in the nation, demand for
tires has also increased. The growth dynamics are being favored by the
country's rising automobile sales, and in the years ahead, the market is
anticipated to create new growth opportunities for Saudi Arabia's tire sector.
Major infrastructure that will boost the demand of the OTR tire in the country
are Riyadh Metro and will cost around USD 23 billion. Diriyah Gate Project includes
18,500 units and cost an estimated USD 20 billion in investment, similarly Al
Faisaliah Economic City will cover 2,450 square kilometers and is valued at USD
10 billion, and there are many other projects and investments undergoing, and all these factors are expected to lead to the
increase in demand of the OTR tires in Saudi Arabia during the forecast period.
Rise in Off-Road Activities
For thrill-seekers from all over the
world, Saudi Arabia offers a diverse and pro-adventure landscape. Adventure
travel in Saudi Arabia includes many activities like taking part in Red Sea
scuba diving to see the marine and many desert off road activities like desert
adventure and Dune buggy riding is increasing the demand of the OTR tires in
the country and the growth of the tourism sector in the country is also
influencing the OTR tire demand in the Saudi Arabia.
Strict Regulatory Policies
During the projection period, the Saudi
Arabia OTR tire market's growth is anticipated to be constrained by strict
regulatory policies regarding used tires. Used tire sales and imports are
forbidden by the Saudi Ministry of Commerce. This is done to lessen the number
of traffic accidents that are occurring more frequently in the area because of
the use of subpar tires. The ministry has also prohibited the sale of
overhauled tires for use in vehicles other than those for which they were
originally designed. The market for used tires in the area is anticipated to
suffer as a result. Additionally, the Saudi Arabia Standard Organization (SASO)
stipulates that imports of auto aftermarket parts must be accompanied by a
certificate of conformity. At the Saudi port of entry, shipments that arrive
without a certificate of conformity are rejected. Additionally, it is essential
for the marketing and labelling of any product brought into Saudi Arabia. All
these regulations will act as a hurdle in the projected growth of the Saudi
Arabia OTR Tire Market.
The high cost of tires, particularly in
the commercial vehicle segment, is expected to limit the growth of the Saudi
Arabia OTR tire market over the forecast period. Tires for commercial vehicles
such as trucks, trailers, lorries, and others are extremely expensive. Although
these tires are roughly used, the initial investment is more. Overall, the
increase in the utilization of the OTR tires because of the rise in the
construction and other related activities is expected to drive Saudi Arabia OTR
tire market during the forecast period.