Currently, Thailand is the world's third largest auto tire exporting country after China and Germany. In 2017, Thai auto tire shipments reached over USD3.9 billion. We at KResearch are of the view that the Thai auto tire industry will undergo a major change again in the near future as Thailand will be able to export more auto tires to North America following China's steady investments here to avoid the US trade barriers on auto tires imported from its rival countries. This protectionism is intended to attract more investments into the US.
Given this, KResearch expects that Thai auto tire exports, which are largely Chinese- made REM products, to North America, in particular the US, will grow at least 16 percent to more than USD2.1 billion in 2018, up over the USD1.8 billion reported for 2017. The increase will likely be led by truck and bus tires, with growth of over 35 percent, thanks to substantial investments by China in the Thai truck and bus tire industry recently. In 2019, it is expected that our tire exports to North America will increase to more than USD2.5 billion, or at least 19 percent.
However, close attention must be paid to the US Section 232 (Safeguarding National Security), which is being investigated by Washington, because Thai tire products might be on the list that will be subject to 25 percent tariff rate.