Industry News

CEAT To Expand Tire Production

CAET is planning to invest around USD413.50 million to expand its production in coming five years

India: One of the largest tire manufacturer of India, CEAT Tyres, has announced to invest about USD413.50 million over a period of next five years. Also, CEAT Tyres has recently appointed Subbiah Kumar, as its new CFO, wherein, his tenure would initiate from 16th January 2017 in the company.

The company plans to reach at a production level of manufacturing 17 million two-wheeler tires annually, 1 million TBR tires and 6 million passenger car radial tires annually, in next five years. The company would carry out its investment through equity as well as debt.

"To boost the growth in our focused segments of 2 wheelers and passenger car radials, we are expanding capacities over the next five years. With the growth in radialisation of truck segment, we have decided to increase our truck bus radial capacity by 1 million tires per annum to maintain our market share." Stated by Anant Goenka, MD of Ceat on future investment plans.

As per TechSci Research, the investment would increase the company’s market penetration in the country’s tire market, where it already ranks among the top players in the industry. Further, with the expansion in the production capacity, the company is likely to offer a wide variety of tires in the country. Consequent to which, it is forecast that the sale of CEAT tires would increase in India over coming five years.

According to a recent report published by TechSci Research, India Tire Market Forecast & Opportunities, 2021’’, the country’s tire market is forecast to witness a CAGR of over 9% during 2016-2021. Though the replacement tire demand had a majority share in 2015, the OEM tire demand is expected to outpace replacement tire demand during 2016-2021. In 2015, Northern region accounted for the largest share in India’s tire market, followed by Southern, Eastern and Western regions of the country. Over the next five years as well, Northern and Southern regions are forecast to continue their market dominance and grab a cumulative market share of nearly 59% in 2021. Two-wheeler tire segment, which accounted for a volume share of over 50% in the country’s tire market in 2015, is also expected to maintain its position as the largest tire segment over the next five years.

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