Name Change for India’s JK
India’s third largest tyre manufacturer, J.K. Industries, have announced that their company name is to change to JK Tyre and Industries, with effect from May 23,2007.
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Continental Automotive Systems Starts India Operations
Continental Automotive Systems has opened a liaison office near New Delhi and inaugurated a technical centre in Bangalore, India. Continental set-up the liaison office in Gurgaon, near the capital New Delhi, in 2006. Working from here the company aims to expand its business with Indian and international OEMs in India. According, to the company the Technical Center in Bangalore will be involved in development projects “for all the business units of Continental Automotive”
As an initial part of the concept, two independent engineering facilities have been established with local partners in Bangalore. About 60 engineers work in Bangalore for Continental Automotive Systems today. It is planned to reach a capacity of more than 200 engineers in 2008, so Continental will be hiring intensively in the next few months.
Indian Figures Show Production Up, Exports Down
Detailed figures showing tyre production and exports by Indian manufacturers have been released, covering the months of December 2006 and January this year. The figures are split into a number of categories – 12 in all – and the January figures show that, in eight of these, production rose compared with January last year. The total number of tyres produced during the month was 10 per cent up on January 2006.
Figure 1 shows the numbers of tyres produced in January, the percentage change over January 2006, plus the percentage change for the period from April to January (06-07) over April- January (05-06). This last figure gives a more accurate indication of trends, as a single month’s figures could be affected by such things as seasonal factors.
Wabco and TVS Group Agree to Brakes Business Demerger
Wabco, a leading provider of vehicle electronic systems to the global commercial vehicle industry, and India’s TVS Group, who amongst other things produce and distribute automotive components and hardware, have announced their intention of transferring the brakes business of their Indian joint venture Sundaram Clayton Ltd (SCL) to a new wholly-owned subsidiary, WABCO-TVS (INDIA) Ltd., (WABCO-TVS) through a demerger plan.
The demerger of the brakes activity will result in two separate corporate entities. The non-brakes business and investments will remain with SCL, who are based in the Indian city of Chennai. The demerger plan is conditional upon securing the approval of the relevant stock exchanges, shareholders, creditors and the Madras High Court.
JK Tyres Sales & Profit Up
For the quarter ending March 31, 2007 JK Tyre & Industries Ltd posted a net profit of £2.64 million as compared to £435,460 in the corresponding previous quarter. Net sales for the period increased 19.48 per cent to £91.35 million from £76.45 million a year earlier. The company’s net profit during the first half of the current fiscal year stood at £1.68 million, compared with £439,000 during the first six months of 2005-06. Net sales rose 17.13 per cent to £194.73 million from the previous year’s total of £165.26.
At present JK Tyre is the undisputed leader of India’s truck and bus radial market with a market share of close to 80 per cent. The company’s light truck and passenger car radial market segments, while not reaching these levels, are still a healthy 25 and 24 per cent respectively. JK Tyre also enjoys a market share approaching 23 per cent in the nylon truck tyre segment.
ISSRP Appoints New Executive Committee in Delhi
(India/Rubber Asia) The 48th International Institute of Synthetic Rubber Producers Inc (IISRP) AGM held in New Delhi, India, recently discussed subjects including the new EU quality regime and the marketing scenarios in the galloping economies of China and India. The organisation also appointed new executive committee members that reflect the growing importance of the Russian market.
The newly elected president Vasily Nomokonov will also serve as the European section president of IISRP. Speaking to Rubber Asia on the sidelines of the AGM, Mr Nomokonov said he would like to see that the institute has a broader platform during his tenure. He would also like to see that Russia continues to play a vital role in the growth of global SR industry. The AGM ended with a mesmerising farewell luncheon hosted in a characteristic Russian red ambience and a hearty invitation from the new president to meet in Moscow for the 49th edition of the AGM.
Thai Hua Rubber – Set to Tap the Boom
(India/Rubber Asia) Thai Hua Rubber (THR), a leading natural rubber supplier to tyre manufacturers, is making vigorous efforts to emerge as a top global player by tapping the enduring NR boom to its maximum. “Our idea is to emerge as a dominant global player covering the entire rubber business cycle as fast as we can and in the most credible manner,” says Mr Luckchai Kittipol, the company’s ever dynamic founder and CEO.
The latest plans include major marketing forays into China and India, the emerging power centres of global rubber industry and ambitious plantation initiatives in potential Asian countries. For instance, in Laos, the company will be investing US$50 million to develop NR plantations in 40,000 hectares during the current decade.
Turkish Industry Set for Take-Off
(India/Rubber Asia) Turkey’s rubber goods manufacturing industry is at a take-off stage thanks to the country’s economic liberalisation policy. The country has as many as 200 rubber goods manufacturing companies of which some are reputed exporters to Europe and the US. Mr. K Berat Oztimur, General Manager, Arsan Kaucuk, a market leader of rubberised pipe seals and bearings, spoke to Rubber Asia on the sidelines of the India Rubber Expo 2007. Selcuk Butun, Sales and Marketing Manager of the company, was also present.
Rubber goods manufacturing industry is flourishing in Turkey, especially after the economic liberalisation initiatives by the government. There are about 200 companies manufacturing rubber goods and at least 40 of them are of good repute. Construction industry is one of the largest consumers of rubber goods, mainly, pipe seals and bridge bearings. There are also a number of tyre companies in Turkey. The industry is, in fact, at a take-off stage and even small companies have started realising the importance of quality and are going in for the best technology.
Rubber Prices Bounce Higher as Demand puts Stretch on Reserves
Prices of export rubber from Vietnam are expected to increase on world markets by about 10 per cent throughout the remainder of 2007 as demand continues to outstrip supply. This analyst prediction added that shipments of Vietnam-sourced rubber to global top rubber importer China would experience price rises of 20 per cent, up from the current US$2,000 per ton to $2400. World market prices are tipped to reach $2,200 per ton.
The world produces about nine million tons of natural rubber each year, most of which is already accounted for, leaving a delicate balance between supply and demand. This balance looks in danger of being upset in the near future, as a recent rubber industry conference in Thailand predicted a jump in global demand by more than 6 per cent in the second half of 2007.
Hankook Passes the 100 Million Mark in China
In late March Hankook Tire celebrated a significant milestone – the 100 millionth tyre manufactured by the company in China came off the production line at Hankook’s Jiaxing facility in Zhejiang Province. This achievement is noteworthy not only in terms of Hankook’s presence in China, but it also serves as a reminder of the speed at which the country’s tyre industry has developed – China’s National Bureau of Statistics records the nation’s total tyre production in 2006 to be 433 million units, a 15 per cent year on year increase.
Speaking on this topic in early 2007, Cho Choong Hwan, vice chairman and former CEO of Hankook Tire, remarked that production from within the BRIC nations – Brazil, Russia, India and China – was growing at a faster rate than domestic demand, meaning that exports from these market were growing considerably, particularly from China.
New Marketing Campaign for Goodyear India
Goodyear India has launched a new marketing campaign centred upon the theme “Take the winning turn” as part of an overall marketing strategy aimed at strengthening its position within India’s consumer replacement market. This campaign kicks off with a new television commercial focusing upon Goodyear’s association with a new movie, Ta Ra Rum Pum, the story of a Nascar driver who fights the odds to become a champion. Goodyear was an obvious choice as a partner in the making of this movie, having been the sole provider of tyre equipment to Nascar since 1997. The company recently signed a deal with Nascar to extend its exclusive association until 2012.
The television commercial, which also emphasises the tyremaker’s 50-year association with Nascar championships, began to be screened in India during the last week of April. The advertisement showcases the “Eagle” range of tyres, which are fitted to Nascar vehicles and in the movie help the star, Saif Ali Khan, to become a champion driver. Products from the Eagle range are available in India both as replacement market tyres and as OE for some premium models, such as all Mercedes Benz cars sold in India.
NR Speculation a Concern in India
An association representing seven of the largest tyre manufacturers in India has expressed concerns that futures market speculation could lead to rising natural rubber prices in the domestic market, forcing manufacturers to become reliant upon imports – as was the situation in December 2006 and January 2007.
While the current domestic market price of rubber in India is Rs84 (£1.03) per kilogram compared with Rs93 (£1.14) a kilogram in the export market, last year tyremakers were forced to import rubber when domestic market prices shot up to Rs100 (£1.23) a kilogram. The director general of India’s Automotive Tyre Manufacturers’ Association, D. Ravindran, believes that speculation in the futures market and a resultant decision by rubber growers to hold back their crop in anticipation of higher prices led to this sizeable price increase. “The futures market, driven by speculation, had given wrong signals to the growers that prices would go up by more than Rs120 a kilogram. As a result of this, they held back their stock, creating an artificial shortage,” he stated.
MRF Tops India OE Tyre Study
(Akron/Tire Review) India’s MRF received the highest customer satisfaction scores in the recent JD Power & Associates Asia Pacific 2007 OE tyre survey.
The study considers new-vehicle buyer perceptions of OE tyre appearance, durability, ride quality, traction and handling.
MRF ranked highest overall, scoring 840 points out of a possible 1,000 points. It marked the fifth time MRF topped the OE study list.
JK Tyre followed in the rankings with 822 points, while Apollo garnered 812 points.
Tyrepress Asia – News With an Asian Emphasis
Tyrepress Asia, sister publication to Tyres & Accessories and NEUE REIFENZEITUNG, is very pleased to announce the launch of its new website Tyrepress Asia and associated e-Newsletter. Based upon the successful format established by Tyres & Accessories and Neue Reifenzeitung’s UK and European e-Newsletters, the Tyrepress Asia e-Newsletter is specifically tailored to provide news and articles from our online publication that are of particular relevance to the Asia and Pacific regions. Our regular newsletter is the only English language tyre industry news source to exclusively cover news and developments from Russia and China down to Australia and New Zealand and from India across the Pacific Rim, and its online format ensures our reports will reach their intended audience while still fresh and newsworthy.
Each year a greater proportion of the world tyre parc is produced in Asia, and companies within the region are increasingly looking to become established global brands. This is a time of rapid growth within the region’s tyre industry and an exciting time to be involved in the business. Therefore it is essential to remain informed of decisions made by both today and tomorrow’s leading players in Asia.
For a limited time Tyrepress Asia is offering free subscriptions to their e-Newsletter and newly launched website Tyrepress Asia– a website where tyre professionals from around the globe can obtain unrestricted access to the latest information coming from Asia’s tyre industry and markets. Produced by experienced industry journalists, the website contains news, feature articles and downloads designed to keep the reader informed. If you conduct business in the Asia and Pacific regions, or simply have an interest in keeping informed about developments in these and coming markets, then Tyrepress Asia invites you to visit our website or click here to obtain your free subscription.
Ceat Shows Interest in China
Ceat, India’s fourth largest tyre manufacturer, has its eye on acquiring or entering into a partnership with a tyremaker in China. Such a move would benefit Ceat considerably, and the company believes that the additional capacity this would bring, along with removing bottlenecks in supply and improving the company’s product mix, enable Ceat to place a greater focus upon exports and increase both volume of production and profit margins.
Arnab Banerjee, the company’s vice-president of sales and marketing said “China provides a big opportunity. We may look at options for a possible partnership or even an acquisition.” A presence in China would provide Ceat with a foothold in a market undergoing even more dynamic changes than India. China is currently the world’s largest producer of tyres, with more than 4.5 million tonnes of rubber utilised last year.
