India’s tyre export sector is encountering a critical challenge as the United States has raised tariffs on Indian tyre imports from 25% to as high as 50% across several categories. This move comes at a time when Indian manufacturers had been steadily strengthening their foothold in the US, particularly in the truck, bus, and off-road tyre segments.
The US has consistently remained India’s largest single tyre export market, with export value rising from Rs 1,400 crore in FY18 to Rs 4,300 crore in FY25. During this period, the US share in India’s tyre export basket expanded from 13% to 18%, reflecting both improved global competitiveness of Indian tyre makers and their growing reliance on the American market.
Competing economies, including China, Thailand, Vietnam, Cambodia, and Indonesia, continue to benefit from much lower tariff barriers, placing Indian exporters at a strategic disadvantage. Historically, agricultural and off-road tyres accounted for nearly 75% of US-bound shipments until FY21, but truck and bus tyres have grown sharply from 9% in FY18 to 23% in FY25. Passenger car tyre exports, though smaller, have also shown gradual growth.
With the steep tariff hikes, companies with higher exposure to the truck, bus, and off-road segments are expected to feel the greatest impact, as these categories have been the major drivers of India’s export momentum. Exporters may now need to diversify markets, rationalise costs, and absorb higher tariff burdens, which could weigh on profitability. Firms with diversified global reach or strong domestic operations may be better positioned in the near term.
According to CareEdge Ratings, the Indian tyre industry, which has invested over Rs 20,000 crore in the past 4–5 years to expand capacity for both domestic and export demand, now faces fresh pressure from elevated input costs, raw material shortages, and new tariff barriers.
“The Indian tyre industry, already challenged by elevated input costs and raw material shortages, now faces added strain from steep U.S. tariffs. Despite investments of over Rs 20,000 crore in the past 4-5 years to expand capacity for catering to domestic demand and boost exports, growth momentum risks being derailed. Timely policy interventions such as strengthening export incentives, enabling enhanced R&D support, and advancing manufacturing capabilities are critical to safeguard India’s global market position and ensure long-term competitiveness,” said Sahil Goyal, Assistant Director CareEdge Ratings.
“With the latest tariff hikes, tyre makers with a higher exposure to truck, bus, and off-road categories in the US are likely to feel the sharpest impact. These segments have been key drivers of India’s export growth to the US, and any slowdown here could materially affect overall volumes and profitability for the respective players,” said Ravleen Sethi, Director CareEdge Ratings.
“However, with US tariffs on Indian tyres now at 50% for most categories, while competing nations such as Thailand, Vietnam, and Indonesia continue to face far lower duties, the industry stands at a critical crossroads. Sustaining export momentum will hinge on timely policy support, cost competitiveness, and deeper penetration into non-US markets,” she added.
