Continental to source more from Metro

German tyre major Continental AG has decided to source as many as 30,000 two-wheeler tyres and tubes per month from Metro Tyres Ltd. (MTL). Continental has also firmed up plans to source as much as 50 per cent of tubes to be manufactured by MTL for cars, tractors and light commercial vehicles, according to Indian media sources. These tyres and tubes would be sold in Germany and Europe under the brand name Continental. Meanwhile, MTL has also entered into talks with Bajaj Automobiles, Hero Honda and Yamaha for catering to the original equipment manufacturing segment.

Metro Tyre‘s existing plant has a manufacturing capacity of 100,000 tyres and 100,000 tubes for two-wheeler’s and three-wheelers per month — as much as 30 per cent of these would be sourced by Continental of Germany while around 50 per cent would be sold in the replacement market. Around 20,000 tyres were expected to be sold to original equipment manufacturers. The company hopes to corner around 10 per cent of the market in the next couple of years.

It has also firmed up plans of manufacturing tubes for passenger car, truck and light commercial vehicles — production for which is likely to start in the next few weeks. Talking to Business Standard from India at the sidelines of a programme to launch its tyres and tubes in Kolkata, vice president Jasbir Singh Mata said talks have been initiated with three large two-wheeler manufacturers and that it hoped to strike a deal in the near future.

He also said that the company has targeted a five per cent market share in the replacement market by 2005 March, which would be enhanced to 10 per cent next year. “The replacement market in India was around 11 lakh (1.1 million) units per month and we hope and Metro Tyres was expected to clock a 15 per cent growth,” he added.