TVS Projects 30% Growth, Hints at Future Greenfield Expansion

TVS Tyres expects to maintain a growth rate of 30 per cent in the Indian market, reports the company’s marketing general manager. Mr. M Sivasubramanian told India’s Business Standard newspaper that this projected growth has already been witnessed over the last three years, during which time the company has raised its production capacity from 600,000 to 900,000 tyres. He added that each year TVS Tyres is investing Rs 4 million (£51,800) in research and development.

Sivasubramanian also believes that the introduction of low cost cars, such as Tata’s long-awaited Nano, will not affect the two and three-wheel vehicle specialist’s sales. To the contrary, he commented, TVS project an increase in the demand for two wheeled vehicle tyres, in part due to the growing trend towards replacing tyres at shorter intervals than in previous years.

From the company’s total production output of 11 million tyres per annum, 56 per cent are supplied to OEMs, the largest customer being Hero Honda. Exports account for a further 16 per cent of production, the bulk of these being in the off-road tyre segment. Mr. Sivasubramanian reported that the company’s export business has registered a 30 per cent growth.

Mr. Sivasubramanian further hinted at future plans for a new greenfield facility. The marketing general manager commented that the TVS Tyres factory near Madurai, in the state of Tamil Nadu, was running at full capacity, and that to meet future expansion requirements the TVS would seek a new location in a region offering easy access to raw materials.