Chile Off The Road (OTR) Vehicle Tire Market Research Report: Forecast (2021-2026)

Market Definition

Off-the-Road (OTR) Tires are used majorly in heavy commercial vehicles like tractors, cranes, forklifts, bulldozers, & golf carts, among others. They offer high-quality grip on surfaces like mud, sand, gravel, etc., along with deep & open treads to support the vehicle's movement. The OTR tire industry in Chile is driven by the growing number of construction, mining, & agricultural activities in the country.

Chile's tire industry is dependent entirely on the aftermarket category, owing to the absence of automobile OEMs in the country. Favorable policies & reforms are positively impacting the construction sector in the country, i.e., driven primarily by increasing foreign investments. It, in turn, is leading to soaring requirements for earthmoving & construction equipment to suffice the growing number of construction, mining, & agricultural activities, thereby fueling the demand for OTR tires and driving the tire industry.

Market Insights

The Chile Off-the-Road (OTR) Tire Market is expected to grow at around 3.23% CAGR during the forecast period, i.e., 2021-26. The growth of the market is driven primarily by the mounting demand for earthmoving & construction equipment tires for infrastructural & residential construction activities in the country, coupled with massive investments by the government of Chile in the mining sector and construction activities associated with roads, railways, residential & commercial buildings, seaport & airport expansion, etc. Moreover, the burgeoning requirement for tractors and the increasing expenditure on various agricultural programs to boost farm mechanization are also driving the market.

Chile is an import-driven country with limited OEMs (Original Equipment Manufacturers). The mining sector is one of the most prominent industries in the country, with a myriad of Copper & Silver mines that generate significant demand for OTR tires for earthmoving & construction equipment. There are various upcoming projects & notable investments planned for the mining industry, which would boost the demand for earthmoving equipment tires in Chile and drive the market over the forecast period. For instance:

• El Peñón mining project was started by Yamana Gold in the Antofagasta region with a total cost of USD 484 million, and around USD 295 million is to be spent in the coming 5 years.

Impact of Covid-19 on the Chile Off-the-Road (OTR) Tire Market

With the advent of Covid-19 in 2020, the Chile Off-the-Road (OTR) Tire Market observed a demand slump due to a halt in economy generating activities like construction & mining, coupled with supply chain disruptions among the major OTR tire manufacturing countries. Moreover, the market witnessed a further decline in its growth due to the reducing demand for raw materials like copper, silver, etc.

However, with the gradually decreasing Covid-19 cases and upliftment of restrictions, the demand for OTR tires witnessed a substantial hike in 2021, owing to the economic normalization and resumed requirement for construction equipment & earthmovers.

Market Segmentation

Based on Vehicle Type:

• Earth Moving Equipment
  • Excavators
  • Loaders
  • Graders
  • Bulldozers
  • Road Rollers
• Agricultural Equipment
  • Tractors
  • Combines
• Material Handling Equipment
  • Cranes
  • Forklifts

Of them all, the Earthmoving equipment attained a significant share of the Chile Off-the-Road (OTR) Tire Market during 2016-19. It attributes to increasing investments in various construction projects, the rapidly expanding mining industry, burgeoning road & rail infrastructure developments, and the mounting availability of Chinese radial tires in Chile.

The earthmoving equipment comprises heavy-duty vehicles used for construction operations & digging out the earth for foundational work. The mounting demand for earthmoving tires is driven mainly by vehicles like excavators, backhoe loaders, bulldozers, graders, trenchers, etc.

The demand for raw materials has risen substantially in the previous few years, which, in turn, has facilitated sizeable investments from the government & private sector in improving the existing capacity of mines and opening new ones. Hence, the increasing number of earthmoving equipment & their extensive usage spurred the demand for OTR tires in recent years.

On the other hand, Agricultural equipment like tractors, combines, etc., are projected to witness an astronomical growth rate in the market over the coming years. It attributes to the government's active participation in introducing innovative projects like farm equipment programs, burgeoning investments in commercial farming, and expanding farm mechanization.

Based on Demand Type:

• OEM
• Aftermarket

Of both, the Aftermarket segment dominated the market in the previous few years, and the same trend is likely during 2021-26. Since Chile’s economy relies majorly on imports, only a few OEMs are present in the country. Increasing consumer investments in new machinery & equipment due to various ongoing & upcoming infrastructure development projects are driving the demand for aftermarket tires in Chile. Moreover, the mounting inclination of farmers toward used tractors is another crucial aspect projected to positively influence the sales of OTR tires in the aftermarket category over the coming years.

Key Market Driver: Massive Government Investments toward Infrastructural Developments

The infrastructure sector in Chile has shown promising growth in the previous few years with massive government investments, which has boosted the sales of OTR tires. The rapid rise in construction projects associated with railway & road expansion and the aviation & port infrastructure developments are projected to infuse the need for earthmoving & construction equipment in the country and thus drive the Chile OTR Tire Market during 2021-26.

Key Questions Answered in the Market Research Report:

1. What are the overall statistics or estimates (Overview, Size- By Value, Forecast Numbers, Segmentation, Shares) of the Chile Off-the-Road (OTR) Tire Market?
2. What are the region-wise industry size, growth drivers, and challenges?
3. What are the key innovations, opportunities, current & future trends, and regulations in the Chile Off-the-Road (OTR) Tire Market?
4. Who are the key competitors, their key strengths & weaknesses, and how do they perform in the Chile Off-the-Road (OTR) Tire Market based on the competitive benchmarking matrix?
5. What are the key results derived from surveys conducted during the Chile Off-the-Road (OTR) Tire Market study?