Report: South Korea to grow 5% CAGR from 2013 – 2018

Analysts at TechSci Research have published a new report highlighting the growth potential of the South Korean tyre market. According to the report entitled “South Korea Tyre Market Forecast & Opportunities, 2018”, the tyre market in South Korea is expected to grow at the compound annual growth rate (CAGR) of 5 per cent between 2013 and 2018 in terms of sales revenue.

The report suggests that this is prompted by increased demand for automobiles and tyres in the global market as well as domestic market (South Korea exports the majority of its automobiles and tyres to other countries).

The domestic market for tyres in South Korea is dominated by the passenger car segment. Hankook, Kumho and Nexen are the leading companies in South Korea, equipped with strong distribution network and OEM tie ups. South Korea has various trade agreements with different countries around the world including European Union and US, through which the automotive products including tyres, manufactured in the country are easily exported to these countries. The tyre market in South Korea is also likely to get benefited by the mandatory tyre labelling which would come into effect from November 2013. The tyre labelling emphasizes on the production of eco-friendly and fuel efficient tyres in South Korea.

South Korea is described as “one of the fastest growing economies and is also one of the key investment markets for the automotive industry”. This is said to be down to availability of cheap and skilled labour force equipped with the latest technology in the production of tyres and automobiles has made South Korea as one of the largest automotive manufacturing markets. South Korea is also one of the largest exporters of automobiles in the world, pointing to OE tyre supply opportunities. Major global auto companies such as Hyundai, KIA, GM and Renault have set up their production facilities for passenger cars and commercial vehicles in South Korea. South Korea is an export driven market as majority of the automobiles and tyres produced in the country are exported to North America, South America, Africa, Asia and Middle East. The increasing production of automobiles in the country is driving the demand for tyres. Metropolitan cities such as Seoul, Incheon city, Ulsan, Busan, Gyeonggi and South Gyeongsang Province are the key markets for tyre sales in the country.