India’s Tyre Industry Shows 7-8% Revenue Growth Driven by Replacement Demand in FY25

The Indian tyre industry is set for robust growth this fiscal year. This increase is primarily influenced by replacement demand. The experts are forecasting a 7-8% increase in revenue, driven primarily by strong replacement demand. As the sales of both commercial and passenger vehicles surge nationwide and owners increasingly turn to the aftermarket for tyre upgrades. This rise in demand has subdued the demand from original equipment manufacturers (OEMs).

According to recent industry reports, replacement tyres now account for nearly half of total annual sales, underlining their importance to the sector's performance. It is also to be noticed that the rising premiumization is an expected realization. With respect to OEM segments, which have 25% of the total volume, they are expected to see more steady growth of 3-4% this fiscal year.

Replacement Demand Steers Industry Growth

Industry research suggests that while the OEM segment—which supplies tyres to carmakers for new vehicles—is expected to see only modest growth. The steady increase in cars, two-wheelers, and commercial vehicles on Indian roads ensures that the replacement segment remains the backbone of the industry. The research was conducted by CRISIL Ratings. This organization has taken account of India’s top 6 tyres manufacturing units, which represent about 85% of the sector’s Rs 1 crore market revenue.

About 75% of total tyre sales are made within India. Another portion of the market is shared with replacement purchases, accounting for half of industry volume. While the remaining share is distributed among OEM sales and exports. The industry is also benefiting from strong balance sheets and disciplined capital expenditure, with top manufacturers prioritizing investments.

Also Read: MRF Showcases Breakthrough Tyres at Bharat Mobility Expo 2025

From the Director’s Desk

CarBike360 Says

India’s tyre industry has shifted into high gear, powered by excessive replacement demand and a growing appetite for premium products. While trade wars to input inflation remain part of the landscape. However, domestic demand and strategic investments are set to keep the sector on a steady course in FY25. For automotive fans and industry analysts alike, all eyes will remain on how tyre makers balance growth ambitions with the need to defend their turf against global shocks and price pressures.