The Hindu Business Line : Ceat keen on tie-ups for radial tyre plant

Kolkata, Aug 13 In an effort to grab a sizeable market share of the truck bus radial tyres sector, Ceat Ltd is planning to increase sales from 600-700 tyres a month to 4,000-5,000 by June 2008.

While the company’s current outsourcing arrangement with Pirelli will continue, bulk of the incremental volume will be outsourced from China.

“We have shortlisted a few Chinese producers and are currently evaluating the performance of these tyres. The evaluation process will be over shortly to make way for regular outsourcing,” a company official said.

Unlike tyres sourced from Pirelli, Chinese tyres will be marketed under brand names other than Ceat.

On plans to set up a greenfield radial tyre facility, the official said that while top five global radial manufacturers are reluctant to enter into technology tie-ups, Ceat was pinning hopes on companies like Yokohama and Toyo of Japan; Cooper of the US and Kumho and Hankook of Korea for access to “decent radial technology.”

It may be mentioned that Ceat had access to Yokohama radial technology in the early 90s.

Sources hinted that there was an effort to revive the old contact with Yokohama.

Interestingly, the company has decided to develop its own technology in case there is a delay in forging a tie-up.

“We are committed to setting up a greenfield facility and will not wait forever for a tie-up. We will close the project latest by December. Once the plan is finalised, the plant will be set up in 18 months.”

As an alternative, the company has roped in consultants or advisors with adequate exposure to technologies used by global majors (like Bridgestone, Michelin and others).

“We believe that the current rate of radialisation in truck bus segment will give ample time to develop the technology, if need be,” the official said.

“Accordingly, we plan to set up one or two modules producing up to 20,000 tyres a month on a pilot basis and stabilise the technology in two years from setting up the factory.”

Truck bus radials apart, the new plant – to be located outside Maharashtra – will also produce tyres for passenger car, utility vehicles and light commercial vehicles.

More Stories on : Tyres | Outlook | Alliances & Joint Ventures

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
Nuclear deal: ‘No compromise on India’s interests’

Link crop loan with weather: Panel on debt

Bharti, Vodafone hike mobile tariffs

Capital investments may top last year’s levels: RBI

Ceat keen on tie-ups for radial tyre plant

HCL Tech Q4 net up 109%

Volvo looking for partner to make entry-level trucks

Shareholder base of top 3 majors swells

Demand for steel, metals may recover by year-end

Shriram Transport buys 40% stake in Ashok Leyland arm

Paint stocks perform well

Walchandnagar Ind in demand

HSBC India goes in for a down-to-earth transformation

Insurers here feeling US sub-prime heat