This is the motto of tyre consumers in India as 3/4th of tyres sold in India are Indian!!!
They clearly adopted a ‘go-slow’ strategy. Take Goodyear India for example, the third-largest tyre company in the world with a massive 17% global market share. Unbelievably, the same Goliath has a meager 6% market share in India! And now as a revival act, it plans to invest $20 million to expand capacity at its Aurangabad facility. Similarly, Bridgestone is mulling over setting up a truck & bus tyre manufacturing facility in India over the next 3 years with an estimated investment of $200 million. Clearly, they need to invest more...
Even the ‘technological’ superiority of internatinal players is fast diminishing as Indian players work hard ‘technologically’. Take Ceat for instance. It is scouting for a tie-up with Pirelli (Italy) in the truck & bus tyre category as Arnab Banerjee, VP–Marketing, Ceat, explains, “We are looking for a foreign partner and it is purely for the purpose of gaining the technological edge.” MRF too plans to expand its capacity with a capex of Rs.5 billion. However, there is a common challenge in the name of inflationary pressures on input costs in the auto & tyre industry, which is causing a slowdown in the industry. However, industry experts are positive about the future as Revati Kasture, Head, CARE Research, points out, “The tyre industry will register a growth of 9-10% in the next five years. The truck & bus and LCV tyre categories are expected to register a CAGR of 8% and 14% respectively.” Undoubtedly, there is a ‘goodyear’ awaiting for the Indian players. Hopefully it’ll bring smiles to global giants too.
They clearly adopted a ‘go-slow’ strategy. Take Goodyear India for example, the third-largest tyre company in the world with a massive 17% global market share. Unbelievably, the same Goliath has a meager 6% market share in India! And now as a revival act, it plans to invest $20 million to expand capacity at its Aurangabad facility. Similarly, Bridgestone is mulling over setting up a truck & bus tyre manufacturing facility in India over the next 3 years with an estimated investment of $200 million. Clearly, they need to invest more...
Even the ‘technological’ superiority of internatinal players is fast diminishing as Indian players work hard ‘technologically’. Take Ceat for instance. It is scouting for a tie-up with Pirelli (Italy) in the truck & bus tyre category as Arnab Banerjee, VP–Marketing, Ceat, explains, “We are looking for a foreign partner and it is purely for the purpose of gaining the technological edge.” MRF too plans to expand its capacity with a capex of Rs.5 billion. However, there is a common challenge in the name of inflationary pressures on input costs in the auto & tyre industry, which is causing a slowdown in the industry. However, industry experts are positive about the future as Revati Kasture, Head, CARE Research, points out, “The tyre industry will register a growth of 9-10% in the next five years. The truck & bus and LCV tyre categories are expected to register a CAGR of 8% and 14% respectively.” Undoubtedly, there is a ‘goodyear’ awaiting for the Indian players. Hopefully it’ll bring smiles to global giants too.
Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).
and Arindam Chaudhuri (Renowned Management Guru and Economist).
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