Men’re from Mars...

Keep rolling, rolling, rolling seems to be the mantra for the Indian tyre czars since all of them have announced some handsome capex plans. Despite the recent torment- ridden automobile times (interest rate mania) and the heavy pressure being applied by the ever rising input costs and increasing competition, the Indian tyre industry is in high spirits. Of course, backed by the strong auto numbers projected in times to come. Cumulatively, the heavyweights like MRF, JK, CEAT etc and midsize & regional players plan to pump in more than Rs.70 billion over the next couple of years. A.K. Bajoria, President, JK Tyre, confirmed, “With the industry clearly on an upswing, JK Tyre is aggressively working to exploit the opportunities.” JK plans to invest Rs.11 billion; and CEAT Rs.8 billion. Foreign shores also beckon. Apollo did so last year with its African Safari, and now, the midsize player Metro Tyres recently set up its office in Barcelona to roll out its European voyage. The company already enjoys the lucrative European market through Continental AG of Germany. Rummy Chhabra, MD, Metro Tyres, told us, “With the start of our operations in Europe, Metro Tyres is taking a decisive step in establishing a platform for growth in Europe.” Of critical interest would be how these firms shore up getting more and more OEM contracts, the most profitable way to increase sales and earn profits. Keep rolling guys...


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Source : IIPM Editorial, 2008

An Initiative of IIPM, Malay Chaudhuri and Arindam Chaudhuri (Renowned Management Guru and Economist)