Financial performance Report of the Managers 05 5.1 REPORT OF THE MANAGERS 5.1.1 TIRE MARKETS 5.1.1 a) A global market worth some $190 billion in 2023 The global tire market edged up slightly year-on-year in 2023, to just over $190 billion, with light-vehicle tires accounting for approximately 60% of the total and truck tires 30%. By volume, the market represented around 1.6 billion car and light truck tires and some 210 million truck and bus tires. Around three out of four tires were sold in the Replacement market. Longer term, tire demand is likely to expand by 0-2% a year on average in mature markets and by 2-4% a year on average in the new markets. In this environment, Michelin is targeting growing, high value-added market segments, with a focus on premium segments. Changes in tire standards The main regulatory change impacting the tire market in 2024 was the entry into application on July 1 of the European R117-04 regulation, which mandates stricter wet grip standards for worn tires. It includes a regulatory test that will help to improve road safety while encouraging motorists to use trustworthy tires down to the legal minimum tread depth of 1.6 mm. Michelin supports the new regulation which, in addition to making roads safer, will also help to preserve both the planet and the purchasing power of European motorists. The market is also regularly impacted by the introduction of standards that are indirectly related to tires. New emissions standards, for example, can spur sales of new vehicles (and with them Original Equipment tires) ahead of their entry into application, as happened in the North American Truck tire market in 2023. This is also the case for standards affecting tire components, such as the European Union Deforestation-free Regulation (EUDR), which caused imports of Passenger car and Light truck tires from Asia to surge in September and October 2024 ahead of its scheduled application on January 1, 2025 (postponed at year-end to January 1, 2026). Similar spikes in imports, particularly from Asia, are also observed in the months preceding the introduction of new or higher customs duties. In first-half 2024, for example, Truck tire imports from Thailand to North America rose sharply ahead of the introduction of anti-dumping duties by the United States over the summer. THE GLOBAL TIRE MARKET BY MANUFACTURER IN 2023 Source: 2023 sales in US dollars, published in Tire Business. (1) Tiremakers with a 2-7% market share according to the Tire Business ranking. (2) Tiremakers with less than a 2% market share according to the Tire Business ranking. 5.1.1 b) Tire markets in 2024 Methodological note: Tire market estimates reflect sell-in data published by local tiremaker associations (sales of manufacturers to dealers and vehicle manufacturers), plus Michelin's own estimates of sales by tire manufacturers that do not belong to any association. These estimates are based primarily on import-export statistics and are expressed in the number of tires sold. They are regularly adjusted and may be updated following their initial publication. 23.2% AMid-sized tiremakers(1) 13.3% Bridgestone 9.0% Goodyear 40.2% Other tiremakers(2) 14.4% Michelin 318 2024 UNIVERSAL REGISTRATION DOCUMENT_MICHELIN
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