South America Tire Market, By Vehicle Type (Passenger Cars, Light Commercial Vehicles, Medium & Heavy Commercial Vehicles, Two-Wheelers, Off Road Vehicles (OTR)), By Tire Construction (Radial, Bias), By Demand Category (OEM, Aftermarket), By Country, Competition Forecast & Opportunities 2020-2030F

Market Overview

The South America Tire market was valued at USD 13.38 Billion in 2024 and is expected to reach USD 21.01 Billion by 2030 with a CAGR of 7.8% during the forecast period. The South America tire market is experiencing steady growth, driven by a combination of macroeconomic recovery, infrastructure development, increasing vehicle ownership, and expanding logistics and e-commerce sectors across the region. Countries such as Brazil, Argentina, and Colombia are witnessing a rebound in automotive production and sales, supported by government incentives and improving consumer confidence. The growing demand for passenger and commercial vehicles, along with a rising preference for fuel-efficient and durable tires, is fueling market expansion. Urbanization and the proliferation of ride-hailing and last-mile delivery services are further boosting the replacement tire segment, particularly in densely populated cities. Additionally, the agricultural and mining sectors, significant in countries like Brazil, Chile, and Peru, are generating strong demand for off-the-road (OTR) tires.

Technological advancements and innovations in tire manufacturing, such as the development of eco-friendly, low rolling resistance, and smart tires with embedded sensors, are aligning with the global shift towards sustainability and digitalization. Moreover, the region's growing awareness of vehicle safety and maintenance, coupled with the expansion of service networks and e-commerce platforms for tire sales, is improving consumer accessibility and fueling the aftermarket segment. Tire manufacturers are increasingly investing in local production facilities and strategic partnerships to reduce import dependency and navigate trade barriers. The implementation of stringent regulatory norms regarding tire performance, labeling, and emissions is also shaping market dynamics and pushing manufacturers toward higher-quality standards. Despite challenges such as currency volatility, political uncertainty, and inflationary pressures in some nations, the overall outlook remains positive due to the rising motorization rate and evolving consumer expectations. The market is also benefiting from increased penetration of radial tires, especially in commercial fleets, owing to their longevity and efficiency. The gradual electrification of mobility and government initiatives promoting green transportation are expected to open new avenues for specialized tire categories. As sustainability, digital connectivity, and performance optimization become central to purchasing decisions, tire manufacturers in South America are expected to adopt more integrated, customer-centric, and eco-conscious approaches to product development and distribution.

Key Market Drivers

Rising Vehicle Ownership and Expanding Automotive Production in Key Economies

One of the primary drivers of the South America tire market is the consistent rise in vehicle ownership and the revival of automotive manufacturing activities, especially in large economies like Brazil and Argentina. In 2024, Brazil produced 2.55 million vehicles, marking a 9.7% increase from 2023, and reclaiming its position as the world’s 8th largest vehicle producer. As the middle class expands and urbanization accelerates across the region, consumer demand for personal mobility has increased significantly. In countries such as Brazil—the largest automobile market in South America—the rebound in consumer confidence and access to flexible financing options have led to a surge in new vehicle sales, particularly passenger cars and light commercial vehicles. Alongside rising ownership, automotive production has also regained momentum, backed by investments from global OEMs (Original Equipment Manufacturers) and supportive government policies. The implementation of local content requirements and trade protection measures have encouraged domestic vehicle manufacturing, creating a cascading demand for tires both as original equipment and through replacement cycles. Furthermore, the increasing age of vehicles on the road in several countries is driving the replacement tire market, particularly in urban and peri-urban areas where daily vehicle use is high. The automotive ecosystem's growth has a multiplier effect on the tire market, making vehicle fleet expansion a fundamental demand driver.

Growth of Logistics, E-Commerce, and Agricultural Activities

The rapid expansion of logistics, transportation, and e-commerce sectors across South America has been a critical factor in boosting tire demand, especially in the commercial and off-road vehicle segments. With the surge in online retail activity, especially after the COVID-19 pandemic, there has been a significant rise in last-mile delivery and freight transport requirements, necessitating frequent maintenance and replacement of tires. Light commercial vehicles (LCVs) and medium and heavy commercial vehicles (MHCVs) form the backbone of these delivery and logistics operations, leading to increased consumption of durable, high-performance tires capable of withstanding heavy loads and long-distance operations. MercadoLibre—Latin America’s leading e‑commerce company—announced in April 2025 a $5.8 billion investment in Brazil, including logistics upgrades and new distribution centers. Moreover, South America’s economy remains heavily dependent on agriculture and mining, particularly in countries such as Brazil, Argentina, Chile, and Peru. These sectors rely on tractors, harvesters, dumpers, loaders, and other off-the-road (OTR) vehicles, creating robust demand for bias and radial OTR tires. The seasonal nature of farming and the rugged terrains in mining areas further amplify the need for high-traction and wear-resistant tires. As infrastructure projects and road connectivity initiatives gain momentum across the continent, the demand for commercial vehicle tires is expected to remain strong, ensuring long-term growth in both OEM and aftermarket tire segments.

Increasing Adoption of Technological Innovations and Sustainability Practices

The South America tire market is also being driven by increasing consumer preference for technologically advanced and environmentally sustainable tire solutions. With the rising awareness of vehicle safety, fuel efficiency, and total cost of ownership, end-users are gravitating toward high-performance tires, such as those featuring low rolling resistance, enhanced grip, and longer tread life. Tire manufacturers are responding by investing in R&D and deploying advanced materials like silica compounds and nanotechnology to create lighter, more efficient products. Additionally, the adoption of digital technologies—such as embedded tire pressure monitoring systems (TPMS), smart sensors, and connected platforms—is gaining traction in fleet management applications, enabling real-time performance tracking and predictive maintenance. These innovations not only enhance safety but also reduce operational costs for commercial vehicle operators. Sustainability is another critical driver shaping the market, as both regulatory pressure and consumer expectations push tire producers toward green manufacturing practices, recyclable materials, and lower carbon footprints. Global tire brands operating in South America are launching eco-friendly product lines and establishing local recycling initiatives to comply with environmental norms and build brand loyalty. As the region gradually transitions toward electric mobility and adopts climate-conscious policies, the demand for tires tailored for electric vehicles and low-emission operations is set to increase, further fueling innovation-led market growth.

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Key Market Challenges

Economic Instability and Currency Volatility Impacting Consumer Spending and Manufacturing Costs

One of the most persistent challenges for the South America tire market is the region’s economic volatility, which directly affects both consumer purchasing power and the operational stability of tire manufacturers. Countries like Argentina, Venezuela, and to some extent Brazil, have been grappling with high inflation, frequent currency devaluation, and fiscal imbalances. These macroeconomic fluctuations have led to unpredictable cost structures, especially for tire manufacturers reliant on imported raw materials such as natural rubber, synthetic rubber, carbon black, and steel cords. A weak or unstable currency significantly increases the cost of imports, resulting in higher prices for finished products in the local market, which discourages consumer demand—particularly in the price-sensitive aftermarket segment. Furthermore, high interest rates, reduced access to credit, and tightening fiscal policies can dampen vehicle sales, which in turn reduces OEM tire demand. The uncertainty also limits the ability of companies to make long-term investments in technology upgrades or capacity expansion, thereby slowing innovation and domestic production growth. For multinational tire manufacturers, profit repatriation and operational planning in such environments become increasingly complex. Overall, economic instability leads to demand fluctuations, inventory mismanagement, and lower consumer confidence, all of which weigh heavily on the market's sustained growth trajectory.

Heavy Dependence on Tire Imports and Weak Local Manufacturing Ecosystem

Another major challenge facing the South America tire market is the region’s significant dependence on tire imports, especially for premium and specialized tire segments, due to a relatively underdeveloped domestic manufacturing base. Although Brazil has a more mature tire production landscape with a few global players maintaining local facilities, many other countries in the region—such as Chile, Peru, and Colombia—rely extensively on imported tires to meet both OEM and aftermarket demands. This import reliance creates multiple vulnerabilities. Stellantis pledged R$30 billion (USD 6.1 billion) to modernize Brazilian plants and introduce hybrid models, aiming for 20% electric vehicle (EV) sales by 2030.  First, it exposes the market to global supply chain disruptions, such as those experienced during the COVID-19 pandemic, which led to tire shortages, shipment delays, and inflated freight costs. Second, it makes the local market susceptible to international trade dynamics, including tariffs, anti-dumping duties, and trade restrictions. For instance, some countries have had to impose safeguard measures to protect their fledgling domestic industries from low-cost Chinese tire imports, which further complicates procurement for distributors and inflates prices for end users. Moreover, the lack of strong local manufacturing capabilities limits product diversification and hinders the availability of application-specific tires, such as high-performance EV tires or specialty OTR tires. The limited R&D presence and skilled labor shortages in tire technology also act as bottlenecks in developing a self-reliant ecosystem. As global trends move towards smart and sustainable tires, the region risks lagging behind unless significant investment is made to strengthen its domestic production base and supply chain resilience.

Infrastructure and Regulatory Challenges Hindering Market Penetration and Quality Control

Infrastructure inadequacies and fragmented regulatory frameworks present another significant hurdle to the development of the South America tire market. While urban centers and developed industrial corridors may have access to proper road networks and distribution infrastructure, many rural and remote regions still suffer from poor connectivity, making it difficult to ensure efficient tire distribution, servicing, and replacement. This not only limits market reach—particularly for OTR and commercial vehicle tires used in agriculture and mining—but also increases logistical costs, reducing profitability for tire retailers and distributors. In addition, the availability of reliable service centers and skilled technicians for tire maintenance remains inconsistent across countries, leading to suboptimal tire performance and shorter product lifespans, particularly in the aftermarket segment. On the regulatory side, there is considerable variation in standards and enforcement across countries. While nations like Brazil have relatively well-developed tire safety and environmental regulations—such as mandatory tire labeling and recycling obligations—many other markets lack consistent enforcement mechanisms. The absence of harmonized quality standards allows the entry of substandard, counterfeit, or used tires, which undermine the market for legitimate players and pose significant road safety and environmental risks. The illegal trade of retreaded or smuggled tires further distorts pricing dynamics and erodes consumer trust. Additionally, regulatory uncertainty around emissions norms, tire disposal, and import policies makes long-term planning difficult for manufacturers and retailers alike. For the market to grow sustainably, there is a pressing need for better policy coordination, investment in rural infrastructure, standardized regulations across the continent, and tighter control over tire quality and environmental compliance. Without addressing these structural challenges, the full potential of the South America tire market may remain unrealized.

Key Market Trends

Digital Transformation and E-commerce Expansion in Tire Retailing

A major trend revolutionizing the South America tire market is the rapid digitalization of the tire retail ecosystem, driven by increased internet penetration, smartphone usage, and changing consumer behavior post-COVID-19. Traditionally, tire purchases in the region were heavily reliant on physical dealerships and workshops. However, a growing number of consumers and fleet operators are now shifting towards online platforms to compare prices, read reviews, schedule installations, and access promotional offers. This shift is particularly prominent in urban centers such as São Paulo, Buenos Aires, and Santiago, where internet usage is high and delivery infrastructure is relatively developed. E-commerce platforms and digital marketplaces have begun partnering with tire manufacturers and local service garages to offer end-to-end tire solutions—from selection and payment to installation. Multinational players and regional e-retailers are also launching dedicated apps and websites, offering features such as virtual tire advisors, vehicle compatibility checks, and subscription models for regular maintenance. Additionally, large tire brands are integrating customer relationship management (CRM) tools and AI-driven analytics to track customer preferences and personalize marketing strategies.The digital push also includes the use of inventory management systems and real-time logistics tracking for distributors and retailers. In the commercial vehicle segment, fleet operators are adopting digital tire monitoring platforms for predictive maintenance, optimizing downtime, and ensuring tire longevity. While rural areas still face digital infrastructure limitations, the expansion of mobile broadband and fintech solutions such as digital wallets and buy-now-pay-later (BNPL) schemes is expected to deepen the penetration of online tire retail. Overall, this trend is not just improving accessibility and convenience but also reshaping consumer expectations and competitive dynamics in the tire market.

Shift Toward Eco-Friendly and Sustainable Tire Solutions

As global concerns about climate change and resource conservation intensify, South America is witnessing a gradual but important shift toward sustainable tire manufacturing and consumption. Consumers, businesses, and governments across the region are becoming more environmentally conscious, leading to growing demand for “green” tires—products designed to reduce rolling resistance, fuel consumption, and environmental impact. Tire manufacturers are responding by investing in sustainable materials such as silica, soybean oil, and recycled rubber, as well as adopting cleaner production technologies that reduce water usage and CO₂ emissions. Brazil, being a regional leader in environmental regulations and green initiatives, has introduced policies promoting tire recycling, retreading, and environmentally responsible disposal. Several other countries are exploring or have implemented extended producer responsibility (EPR) schemes, making manufacturers accountable for the end-of-life management of tires. In parallel, recycling startups and local governments are developing infrastructure to repurpose scrap tires into materials for roads, playgrounds, and energy recovery. Sustainability also extends to logistics and packaging. Manufacturers are exploring ways to minimize waste during transportation and storage, such as using collapsible containers and optimizing shipment loads. The trend is especially pronounced among large fleet operators, who are under pressure to meet environmental, social, and governance (ESG) standards set by multinational clients or regulatory bodies.

Rising Penetration of Radial Tires Across Commercial and Off-Road Segments

Radialization is a significant structural trend transforming the South America tire landscape, especially in the commercial vehicle and off-the-road (OTR) segments. While radial tires have long dominated the passenger vehicle segment in developed markets, many parts of South America have traditionally relied on bias-ply tires, particularly in heavy-duty, agricultural, and mining applications. This reliance was largely due to lower upfront costs, ease of retreading, and better resistance to rough terrains. However, changing market dynamics are accelerating the shift toward radial tires. Radial tires offer superior performance benefits such as better fuel efficiency, longer tread life, improved traction, and reduced heat generation—key factors for fleet operators focused on optimizing operational costs. As transport and logistics companies look to improve efficiency and reduce downtime, the adoption of radial truck and bus tires (TBR) is rising across major economies like Brazil, Chile, and Colombia. Similarly, large-scale mining and agricultural operations are beginning to transition to radial OTR tires to achieve better load distribution and enhanced durability on challenging terrains.

Segmental Insights

Vehicle Type Insights

In South America, The passenger car tire segment commands a substantial share of the market, driven by the consistent demand for personal mobility, especially in urban centers. Increasing vehicle ownership among middle-class consumers, growth in used car sales, and rising interest in electric and hybrid vehicles are fueling steady tire replacement cycles. This segment benefits from a highly competitive aftermarket, where consumers seek affordable yet reliable tire options. Technological enhancements, such as run-flat tires, low rolling resistance designs, and comfort-focused tread patterns, are increasingly being integrated into products to meet evolving consumer expectations. Premium tire brands dominate the OEM space, while value-oriented brands are prominent in the aftermarket. The segment also sees high seasonal demand fluctuations, with wet-weather tires and performance tires gaining attention in niche markets.

Tire Construction Insights

In South America, Radial tires dominate the market in terms of technological advancement, offering superior ride comfort, lower rolling resistance, and improved tread life compared to bias-ply tires. Originally limited to passenger cars, radial technology is now making strong inroads into commercial and OTR vehicle segments. Fleet operators prefer radial tires due to their ability to reduce fuel consumption and operating costs, which is crucial for long-haul applications. As more manufacturers localize production and expand regional availability, the price gap between radial and bias tires is narrowing, further supporting their adoption. Additionally, the rise in vehicle safety regulations and consumer awareness about performance metrics is encouraging a faster transition to radials. With tire brands offering smart radial options, complete with sensors and telematics integration, radialization is not just a cost-saving measure but a strategic shift in overall fleet management.

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Country Insights

In South America, Brazil stands as the undisputed leader in the South America tire market, driven by its vast automotive base, well-established manufacturing ecosystem, and strong domestic demand. The country boasts the largest vehicle parc in the region, spanning passenger cars, motorcycles, and commercial fleets, which creates a substantial and recurring need for tire replacements. Brazil's robust infrastructure, such as an extensive network of highways and logistics corridors, further fuels demand across segments including light commercial vehicles and heavy-duty trucks. Major global and local tire manufacturers have set up production facilities in Brazil, benefiting from skilled labor, proximity to demand centers, and favorable government policies. The country also has a vibrant aftermarket, with strong distribution channels and increasing digital penetration in auto services, which supports sustained growth. Additionally, Brazil's automotive industry is increasingly embracing sustainable mobility, including electric and hybrid vehicles, which is prompting innovations in tire technology tailored for new powertrains. The presence of major OEMs and rising investments in smart mobility initiatives continue to reinforce Brazil’s dominance in the region.

Recent Developments

In 2024, GRI entered markets like Argentina, Brazil, Chile, Colombia, Ecuador, Paraguay, Peru, Uruguay, and Central America through partnerships with distributors and OEMs. They also initiated dealer training and field testing to support product rollout.

On January 31, 2025, GT Radial and Magnum Tires host Acceleration Convention in Brazil. The two-day event in Recife set out commercial strategies for 2025 and highlighted EV-ready products like the GitiComfort 225 V1, GT Radial SportActive 2, GT Radial FE2, and SUV/4×4 Savero series.

On April 28, 2025, Shandong Linglong Tire invests US $1.19 billion in Brazilian plant. The new facility in Ponta Grossa, Paraná, is planned to produce over 14 million tires annually—including car radials, truck/bus radials, and reclaimed rubber—with construction starting in Q3 2025 and completion expected by 2032.

Key Market Players

• Michelin Group
• The Goodyear Tire & Rubber Company
• Bridgestone Corporation
• Cooper Tire & Rubber Company
• Continental AG
• Pirelli & C. S.p.A
• MRF Tyres
• Yokohama Rubber Company Ltd.
• Toyo Tire Corporation
• Hankook Tire & Technology Co. Ltd.

Report Scope:

In this report, the South America Tire market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

• South America Tire Market, By Vehicle Type:

o   Passenger Cars

o   Light Commercial Vehicles

o   Medium & Heavy Commercial Vehicles

o   Two-Wheelers

o   Off Road Vehicles (OTR)

• South America Tire Market, By Tire Construction:

o   Radial

o   Bias

• South America Tire Market, By Demand Category:

o   OEM

o   Aftermarket

• South America Tire Market, By Country:

o   Brazil

o   Argentina

o   Columbia

o   Chile

o   Cuba

Competitive Landscape

Company Profiles: Detailed analysis of the major companies presents in the South America Tire market.

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South America Tire market report with the given market data, TechSci Research offers customizations according to a company's specific needs. The following customization options are available for the report:

Company Information

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