Apollo Tyres to Invest in its Chennai Plant

India: Apollo Tyres is planning to invest about USD403 million in its Chennai plant. The company is targeting to double its production capacity as a part of its 'Building Leadership in India by 2020' vision.

"We are ramping up production at Chennai facility from 6,000 units to 12,000 units (per day) with investments of USD403 million. It will happen in 24 months. We are beginning the exercise from this October," said Apollo Tyres President, Asia Pacific, Middle East and Africa, Satish Sharma. He further added, "In two-wheeler segment we are still in primitive stage. We entered this segment in May. We are selling at about one lakh units. We targeted of exiting this year with three lakh units. But it may be around 2-2.50 lakh units. We may begin manufacturing of two-wheeler radial tires in our factory in Baroda next year".

The company began production in 2010, at its Chennai facility. Also, the plant is currently producing 6,000 truck-bus radial (TBR) tires. After the investment, it is expected to produce 12,000 tires per day. The company would also increase exports to 15% from the current 10%. The company is planning to start a separate assembly line to produce Sports Utility Vehicle (SUV) segment tires at its Baroda plant.

According to a recent report published by TechSci Research, “India Tire Market Forecast & Opportunities, 2021’’, with more than 60 tire manufacturing plants spread across the country in 2015, India ranks among one of the largest tire markets of the world. Growing automobile sales coupled with expanding automobile fleet are the major factors boosting demand for tires in the country. Moreover, with favorable inflationary scenario, expanding middle class population and increasing national disposable income, tire sales across all the automobile segments are expected to grow in the coming years.

As per TechSci Research, Apollo Tyres rank among the top players in the India industry. The company’s expansion plan for its Chennai plant is likely to increase the overall production output by the company, which would further increase its potential of Indian market penetration. With the growing output, the company is predicted to serve the Indian consumers in a better way.