Leading tyre manufacturer CEAT Ltd sees significant growth potential in the US market, though its current exposure remains small compared with other Indian players. The company said a reduction in US tariffs would benefit both CEAT and the broader Indian tyre industry.
“The US is an important market where we plan to expand and have new product development. So far, we haven’t been significantly affected by tariffs but a reduction to global levels would help us scale supplies,” CEAT Chief Financial Officer Kumar Subbiah told TNIE. At present, the US accounts for about 3–3.5% of CEAT’s revenue. “We hope to see positive developments in India–US trade relations,” he added.
Since late August, tyre exports from India to the US have faced tariffs of 50% on most categories and 25% on select ones, putting Indian exporters at a disadvantage against competitors from China, Thailand, Vietnam, Cambodia and Indonesia, which face much lower duties.
India exports tyres to over 170 countries, with the US as the largest destination, accounting for 17% of overall exports. In FY25, tyre exports crossed ₹25,000 crore for the first time, of which shipments worth over ₹4,300 crore went to the US.
Despite tariff headwinds, CEAT posted a strong July–September quarter, reporting a 52.4% year-on-year rise in consolidated net profit to ₹186 crore. Consolidated revenue grew 14.2% to ₹3,772.7 crore.
Subbiah attributed the strong performance to stable raw material prices, operational efficiency and volume growth. He expects double-digit growth to continue in the coming quarters with demand gradually shifting more towards OEMs and international business.
“In the past six quarters, demand was mostly driven by replacement. This year, OEMs and international markets are leading growth. Replacement demand grew mid–single digit in FY26, while OEMs and exports posted double-digit growth,” he said.
The CFO added that GST 2.0 has improved sentiment in the sector. After destocking and muted sales until late September, a GST rate cut from 28% to 18% for most tyres and from 18% to 5% for farm and tubeless tyres has boosted demand.
“OEM sales are rising, which is encouraging. Lower prices will also lift replacement demand since the cost per tyre has dropped sharply by up to ₹1,500 for commercial tyres,” Subbiah noted.
