Michelin investment in Apollo Tyres cleared

India has approved a proposal by Europe’s biggest tyre maker, Michelin, to pick up a 14.9 per cent stake in tyre-maker Apollo Tyres Ltd for 71.44 million Dollars.

A government statement said the investment by Michelin would be used to manufacture, market and distribute truck and bus radial tyres in India. Truck and bus tyres account for more than 70 per cent of India’s 2.2-billion dollar tyre industry but less than two per cent of tyres are radials.

But radials make up more than 75 percent of car tyre sales. Indian transporters have shied away from radial tyres, seeing them as not rugged enough for the appalling roads and rampant overloading in India. However, radial sales are expected to increase because of improved highway conditions.