Srikumar Krishnamurthy, Senior Vice-President and Co-Group Head, Corporate Ratings at ICRA

India’s tyre sector is moving into a steadier phase after cyclical tailwinds from GST-led formalisation and rural demand. Srikumar Krishnamurthy, Senior Vice-President and Co-Group Head, Corporate Ratings at ICRA, says replacement demand will continue to anchor growth in FY2027 even as original-equipment volumes soften. Premiumisation is lifting tyre makers’ realisations, though input volatility and competition cap pricing power. Export prospects are improving with new trade agreements, but regulatory risks and cost pressures persist as companies balance capex with discipline.

ICRA expects the Indian automotive sector’s wholesale growth to normalise in FY2027. How does this moderation in vehicle volumes translate into tyre demand across OEM and replacement channels?

The normalisation of wholesale volume growth in FY2027 follows a period of elevated growth in the second half of FY2026, which was driven largely by post-GST reform-led factors and favourable rural demand sentiments. The moderation in wholesale volume growth will consequently translate to a similar growth in OE segment. The aftermarket segment, however, will follow the inherent replacement cycle of different sub-segments and other fundamental factors.

Replacement demand currently anchors tyre industry growth. What level of growth do you expect in this segment going forward?

The replacement segment saw a robust growth in the last 4–5 months supported by the post effects of GST rate cuts and healthy rural demand following good monsoons and crop output. The current sentiments are favourable, with factors around economic activities, freight rate movement and farm output reflecting optimistic picture. The segment is likely to outperform the OE segment in FY2027 supported by inherent factors like replacement cycle, safety awareness and regulatory forces.

Premiumisation is evident in vehicles and tyres alike. How is the shift towards larger rim sizes, radialisation and higher-value products shaping revenue growth versus volume growth in FY2026–27?

A change in product mix has been observed in recent times. Rising preference for utility vehicles, premium bikes and electric vehicles have resulted in changes to the average selling price (ASP) of tyre makers. While these elongates the product replacement cycle over time, higher share of sales of large rim sizes and high-performance tyres results in premium pricing and value growth. That said, pricing pressure because of competition and movement in input prices restricts the premium to an extent, in certain segments.

What impact do you expect from the evolving trade agreements between India and United States, along with the proposed India-EU free trade deal, on tariffs for tyres produced and exported from India?

US and Germany are the top-two destinations for Indian tyre exports. Overall, tyre export volumes grew by around 10 percent in FY2025 and around eight percent in H1 FY2026. The recent signing of India-UK and India-EU deals is a positive as Indian tyres are increasingly getting exported to these regions in recent period, reflecting better acceptance. While the developments on India-US tariff-related aspects are a positive, stability in tariff reforms will be critical towards better visibility of exports.

With exporters pivoting towards Europe, Africa and Latin America, what competitive or regulatory barriers might Indian tyre makers face in these markets over the next 12–18 months?

The prospects of Indian exporters remain vulnerable to the regulatory actions and competitive forces. The US tariff-related developments have made tyre makers in

South-East Asia and China more competitive (as compared to India), although the changes in tariff rates is a positive development for Indian exporters. While a depreciating rupee was beneficial, the recent capping of RodTEP benefits is a negative impacting the competitiveness of Indian tyre makers.

Natural rubber prices have remained elevated and volatile. How do you expect raw-material cost trends to evolve in FY2027, and what does this imply for tyre company margins and pricing power?

Rubber prices largely track the demand-supply factors. The prices have largely been volatile in recent years and were affected by a relatively subdued consumption globally. While the supply will remain influenced by weather and other related factors, the global tyre demand is likely to be relatively better, thus keeping the prices firmer in the coming year.

Beyond rubber, inputs such as carbon black and crude-linked derivatives are cyclical as well. Are tyre manufacturers adequately positioned to manage input volatility through sourcing strategies or pass-through mechanisms?

To protect the margins, tyre makers have resorted to better production planning, maintaining optimal inventory and altering the sourcing strategies. That said, the earnings profile of tyre makers remains exposed to any sharp volatilities in input prices, especially replacements.

Industry capex has remained steady, focused on radial capacity and premium segments. Do you foresee a new investment cycle in FY2027–28, or will companies prioritise balance-sheet discipline amid demand normalisation?

The industry’s capex spends are estimated at 8–10 percent of revenues with sizeable investments towards expansions in passenger vehicles and trucks and bus tyres, along with continued focus on debottlenecking, maintenance and R&D activities.

Looking beyond demand and costs, what are the most significant structural challenges facing the Indian tyre sector over the next three to five years – technology shifts, sustainability mandates or global competition?

Multiple trends are emerging in the auto industry, like vehicle premiumisation, changing powertrain mix, fluctuation in adoption of EVs across different product segments etc. In this backdrop, and coupled with global geo-political uncertainties and climate changes, tyre makers face challenges around business strategies. Strengthening technological capabilities, investments in premium performance tyres, enhanced usage of AI for operations, streamlining supply chain activities and diversification are the likely key focus areas for Indian tyre makers.

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Dow Inc. said its chief executive Jim Fitterling will become executive chair of the board from 1 July , 2026, with chief operating officer Karen S Carter appointed as chief executive.

Carter will also join the board on the same date, while Richard Davis will continue as independent lead director.

The company said the changes follow a multi-year succession planning process and are intended to ensure continuity as it advances its strategy as a materials science group.

“On behalf of the Board, I want to thank Jim for his exceptional leadership and continued contributions to Dow,” Davis said. “Jim has led the company through a period of significant transformation while strengthening Dow's strategy, culture and long-term positioning. We are equally pleased to congratulate Karen on her appointment as CEO. She is a disciplined, highly respected leader with a deep understanding of Dow's businesses and customers. This appointment reflects our confidence in her ability to lead Dow forward into its next chapter of growth and value creation for customers, employees and shareholders.”

Fitterling, who has been chief executive since 2018 and chair since 2020, oversaw the company’s separation from DowDuPont and led its repositioning towards higher-growth, consumer-led markets. He also guided the group through broader macroeconomic and geopolitical challenges, while advancing its sustainability ambitions and corporate culture.

“Serving as CEO of Dow has been the privilege of a lifetime,” Fitterling said. “Together with our employees and leadership team, we have transformed Dow into a stronger, more focused company with the right strategy, capabilities and culture for the future. I look forward to continuing to support Dow as Executive Chair and working closely with Karen to help ensure continuity and strong execution.”

As executive chair, Fitterling will continue to lead the board, focusing on long-term strategy, governance and external relationships.

Carter, who has spent more than three decades at Dow, currently oversees business and operational performance across the company as chief operating officer. She previously led the packaging and specialty plastics division, the group’s largest operating segment, where she focused on capacity expansion, asset upgrades and operational reliability, alongside efforts linked to circular economy initiatives.

“I am deeply honored to assume the role of CEO and lead Dow into our next chapter,” Carter said. “Dow has extraordinary people, world-class assets and leading positions in the markets we serve. Our focus remains unwavering: delivering reliable and innovative solutions for our customers, and long-term value for our employees and our shareholders, while accelerating our transformation to set a new competitive standard for best-in-class performance. I look forward to continuing my partnership with Jim in his new role as Executive Chair, and to working with the Board and all of Team Dow to advance our strategy and deliver on our priorities.”

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Nokian Tyres plc is expanding its partnership with Tata Consultancy Services (TCS) to strengthen IT operations and support ongoing transformation.

The companies will focus their expanded partnership on maintaining and developing IT applications to meet Nokian Tyres’ future needs and to increase the efficiency of its IT operations.

TCS has already handled Nokian Tyres’ service desk support, end-user services like device deliveries, and network and data centre operations. Starting June 1, 2026, TCS will also take over maintenance and development of IT applications, as well as on-site support for internal processes.

This change is part of a larger restructuring of Nokian Tyres’ IT organisation to keep up with changing business needs.

“A more extensive partnership with TCS will enable Nokian Tyres to have a globally unified, agile, and efficient operating model that supports business needs. In addition, it creates a sustainable foundation for the increasing adoption of next-generation technologies such as automation, data-driven solutions and artificial intelligence,” said Timmy McLellan, vice-president, IT and processes, and chief information officer at Nokian Tyres.

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JK Tyre & Industries, one of the leading tyre manufacturers in the country, has appointed Mandar V Deo as President – India, effective immediately.

Based in Delhi, Deo will report to the Chairman and Managing Director, Dr Raghupati Singhania, and the Managing Director, Anshuman Singhania. He joins the tyre manufacturer with more than two decades of experience in senior leadership positions, having previously served at Exide Energy Solutions, Cummins India and Cummins Inc.

He holds a bachelor’s degree in mechanical engineering from Pune University, alongside a Master’s degree and a PhD from Pennsylvania State University. He also holds an MBA from the Kelly School of Business at Indiana University.

Deo’s appointment comes as JK Tyre continues to expand its global footprint, which currently spans 105 countries and includes 11 manufacturing facilities in India and Mexico with an annual production capacity of 35 million tyres.

The company maintains a focus on technical innovation through its Raghupati Singhania Centre of Excellence in Mysore and was the first in India to introduce 'Smart Tyre' technology featuring integrated Tyre Pressure Monitoring Systems (TPMS). Additionally, JK Tyre has committed to the global RE100 initiative, aiming to transition to 100% renewable electricity by 2050.

Dr Raghupati Singhania, Chairman & Managing Director, JK Tyre, said, “I am confident that Mr. Deo will provide strong and adept leadership and steer JK Tyre on a new growth trajectory.”

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The research and development team of any tyre maker decides whether the final product will be a success or a failure. And it is prudent to say that a lot of research hours and developmental cash go into making one of the most critical components of the automobile sector. In an exclusive tete-a-tete with Tyre Trends, Vice President and Global Head of Research and Development at Omni United, Olli Seppala, shares insights into the demanding and complex world of tyre research illuminating how markets and other factors dictate team operations.

“Omni United has an experienced team and we understand the needs of different markets very well. We constantly track trends in each region because legislation and approval requirements change all the time. In Europe, for instance, there are evolving regulations and strong influence from testing. In United States, the market is also changing very quickly as it is no longer only about mileage and comfort. Performance has become equally important,” he stated.

The company sells extensively in North America and Europe as well as in countries like South Africa, Australia and several markets across Asia.

However, every market doesn’t necessarily have similar demands, and the onus falls on the research and development team to derive market-ready products.

“Every market is equally demanding in different ways. Europe requires extremely high-performance levels, but customers are also willing to pay for that performance. In Asian markets, however, you still need a certain level of performance, but you must also keep prices under control. That creates additional pressure on the research and development side,” noted Seppala.

In the tyre industry, research and development quietly determines whether a product succeeds or disappears from the market. Behind every tyre lies years of testing, complex material science and constant adaptation to changing global demands. In an exclusive interaction with Tyre Trends, Vice President and Global Head of Research and Development at Omni United, Olli Seppala, explains how the company’s development teams navigate shifting regulations, regional market expectations and sustainability pressures while striving to deliver premium performance tyres at accessible prices across diverse international markets.

He added that European developers sometimes struggle when developing tyres for US or Asian markets because they may still carry the old perception that the US market is only about comfort and mileage.

Currently, the US market is now strongly performance-oriented. Tyre makers must understand specific requirements such as wet grip, correct handling balance, rubber compound characteristics and special durability properties like resistance to cuts and chips.

Asian markets are also highly complex. Conditions can vary dramatically by region. For example, southern China is very different from northern China, so specialised approaches are necessary.

The Japanese market is another example, said Seppala, as Japanese winter tyres are a category of their own and one really has to understand the specific expectations there. In addition, tyres must be durable and resistant to environmental factors such as ozone and pollutants.

WORKING THE WORKS

“When we talk about all-season tyres with the snowflake symbol, European all-season or North American all-weather tyres pose a significant challenge,” noted Seppala.

“Such tyres must balance strong wet grip, stable dry handling in high temperatures and reliable performance in snow and cold conditions. The main challenge is developing a rubber compound that remains flexible in freezing temperatures while maintaining handling stability at around 30 degrees Celsius,” he added.

On the other hand, working with different manufacturing partners also raises certain concerns, which the executive describes as ‘complex situation’. “The process is complex and involves several challenges. When developing a new product, we carry out the design work internally including building the construction and conducting in-house testing. Most of the development work is completed within the company before moving forward to the production stage. However, the advantages generally outweigh the challenges,” noted Seppala.

The company develops its own tyre compounds in-house and is now entering a deeper phase of rubber compounding through a new materials development initiative focused specifically on compounding.

“The goal is to deliver premium tyre performance at accessible prices. Key research and development priorities include improving wet grip, increasing mileage and reducing rolling resistance to balance the tyre industry’s ‘magic triangle’. Sustainability is also becoming essential with growing work on recycled and bio-based materials. Currently, development efforts are focused mainly on passenger car and 4x4 tyres, although we also produce truck and commercial tyres,” he added.

Nonetheless, he noted that shorter development timelines are an everyday challenge for research and developmental teams. While Omni United already has one of the shortest development cycles in the industry, efforts are ongoing to make the process even faster.

However, Seppala averred that the approach depends on the situation. Completely new concepts can be developed quickly, but when replacing a product at the end of its lifecycle, it is often better to allow more time for testing and gradual improvements. In such cases, the focus is not just speed but improving the overall efficiency of the development process.

TECHNOLOGICAL ADVENT

Seppala noted that digital tools and artificial intelligence (AI) are expected to play a very significant role in tyre research and development, particularly in construction design and compound development.

Machine learning can help improve compound recipes by analysing large datasets generated from continuous testing. Using non-linear analysis and specialised software, the company processes accumulated testing data to refine and optimise compound formulations over time.

Seppala also noted that tyre development today must address broader environmental challenges, including noise pollution. With electric vehicles becoming quieter, tyre noise is becoming more noticeable.

At the same time, regulations such as Euro 7 are increasing attention on particle emissions. He explained that noise is an important factor in tyre design. While the European tyre label mainly measures external pass-by noise, the company also focuses on reducing noise inside the cabin to improve driver and passenger comfort, alongside minimising environmental noise pollution.

Over the next three years, one of the main priorities of the company will be taking materials development to the next level, making it a major focus for the research and development team.

Another key area will be expanding the company’s testing operations. While he did not disclose detailed strategic plans, he noted that testing capabilities will increase significantly, covering outdoor track testing, indoor tyre testing and laboratory testing of materials. All three areas will play an important role in future development.

Alluding to the areas pertaining to tyre performance that the company plans to focus on in the future, he said, “Tyre performance involves many factors, making it difficult to rank them strictly, but improving safety will remain a key focus in the coming years. While current products already perform at a high level, we aim to further enhance safety performance.”

Seppala also highlighted ongoing work on replacing 6PPD, noting that progress has been promising. The goal is to become the best-performing tyre brand in ozone resistance, addressing ozone cracking issues seen in many manufacturers globally, while developing a solution that is both sustainable and effective.

Commenting on key trends that will influence the company’s future, Seppala said, “Three major trends will shape the company’s research and development work going forward. First, market expectations in Europe and US are gradually converging. The US market is placing greater emphasis on safety and wet grip, while Europe is increasingly focusing on abrasion resistance and tyre mileage, creating pressure to improve durability. Secondly, sustainability will remain a constant industry priority. Thirdly, the key challenge will be developing tyres with advanced materials that deliver premium performance while keeping prices accessible for customers.”

For Omni United, the future of tyre development lies in balancing performance, durability and affordability amid tightening regulations and sustainability demands. As markets converge and technologies like AI reshape research and development, the company’s challenge will be clear as it harnesses advanced materials and faster development cycles to deliver safer, longer-lasting tyres without compromising accessibility.

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