The tyre-sized hole in Europe’s supply chain resilience

Supply chains only become visible when they fail. A tyre shortage could keep trucks off the road, hold up vehicle production and leave farms without essential machinery. A new Oxford Economics report commissioned by Tyres Europe shows the scale of that dependence. It estimates that EU-made tyres supported €572 billion in GDP and 6.1 million jobs across vehicle manufacturing, tyre sales, and their wider supply chains in 2024.

But this activity is acutely vulnerable at a single point: natural rubber. The EU produces none, and more than 90% of its supply comes from just five countries. In a hypothetical climate-driven shock, the report models a 13% fall in global rubber supply, a 160% rise in tyre prices, and six months of acute shortages. It estimates that EU GDP would be €250 billion lower over three years than in a scenario without disruption. This is a stress test, not a forecast.

This is the kind of risk Europe’s Critical Raw Materials Act is designed to help address through supply monitoring, preparedness, and diversification. Yet natural rubber appears on neither the Act’s current critical nor strategic materials list. That distinction between raw material and finished product matters: the Act’s targets for strategic materials mean that the crucial input for tyres is not considered. The paradox is highlighted by the decision of the European Commission’s Joint Research Centre to identify tyres as relevant to Europe’s strategic autonomy.

Increased resilience also comes from using materials more efficiently. For example, retreading can extend tyre life, while recycling and innovation may reduce demand for new inputs. But Europe will still need dependable, responsibly sourced rubber and the capacity to make tyres. The policy goal is straightforward: keep essential transport and production moving when a distant supply shock hits.