Commercial production got underway at JK Tyre & Industries’ new plant in Chennai, India on 5 February. The company announced the facility’s entry into service at a press conference in Chennai the following day.
JK Tyre and Industries Ltd, India’s number three tyre maker, has reportedly secured an OE supply deal to Daimler India Commercial Vehicles Pvt Ltd, supplying tyres for its Bharat Benz trucks.
“The latest original equipment manufacturer (OEM) client for us is Daimler India that will be rolling out trucks at its plant here,” Raghupati Singhania, vice chairman and managing director, told reporters on Monday 6 February, according local news sources. Daimler India is expected to launch its trucks sometime in the middle of this year.
India-based news website Livemint.com reports that antitrust regulator the Competition Commission of India (CCI) is looking into a possible cartel within India’s tyre industry. The CCI began its investigation following receiving a report from its director general earlier this year. This report concluded that the five leading Indian five makers, who together control 95 per cent of the domestic market, and the Automotive Tyre Manufacturers’ Association (ATMA) colluded to fix prices. Now the CCI is, says Livemint.com, looking into the allegation more closely with a view to holding a hearing in December.
Apollo Tyres partnered with vehicle manufacturer Mahindra & Mahindra for the first time in Monsoon Challenge 2011, one of the biggest rallies on the Indian off-roading scene. Beginning on Friday, 22 July from the western Indian city of Nasik with more than 50 participating teams, the rally covered 1,500 kilometres in three days, going via Aurangabad and Kolhapur to the beaches of Goa on Sunday, 24 July. The winning team of Somdev Chanda and Nirav Mehta, riding on a Mahindra Stinger, took home a cash prize of Rs 800,000, a sum Apollo says is the largest cash award ever given in any Indian off-roading adventure.
Existing speculation on Apollo Tyres’ intention to branch into the natural rubber segment has been boosted by an article in India’s Business Standard newspaper. This suggests that both Apollo and JK Tyre may be in the business for plantations in Southeast Asia. The two tyre makers’ dependence, along with their competitors, upon ever more expensive spot market purchases has locked them into a situation where external factors determine the price they must charge for their products; the attractiveness of eliminating reliance upon the fickle natural rubber market is therefore very easy to understand.
Reporting on the financial year that ended March 31, 2011, JK Tyre & Industries Ltd. notes that the selling price increases implemented for its products were unable to keep pace with raw material cost increases, and this adversely impacted upon the company’s margins. Therefore, despite a 30.9 per cent increase in net sales to Rs 59,454.4 million (£806.9 million), the Indian tyre maker’s before profit tax dropped 64.2 per cent to Rs 1,119.6 million (£15.2 million) and net profit declined 71.5 per cent to Rs 625.5 million (£8.5 million). Revenue from the company’s operations in India accounted for 80.0 per cent of total net sales and the former Tornel facilities in Mexico the remaining Rs 11,343.5 million.
Speaking to India’s Business Standard newspaper, JK Tyre & Industries vice-chairman and managing director Raghupati Singhania has shared that the tyre maker is looking at expanding its international presence by 15 to 20 per cent every year. Currently JK Tyre sells Rs 8 billion (£108.5 million) worth of goods outside of India, some 44 per cent of which is produced at international sites. These overseas facilities include the Tornel plant in Mexico, which the Indian manufacturer acquired in 2008, and partner factories in China, Vietnam and Sri Lanka.
Marangoni Retreading Systems has announced a price increase in all European, Middle Eastern and African markets for its entire range of retreading materials. The increase, effective as of 15 February, will be approximately 10 per cent for standard products and 15 per cent for high performance products with high natural rubber content.
Indian manufacturer, JK Tyre has decided to raise its prices by between two and four per cent on the back of raw materials prices going “up to an all time high, touching Rs 210 or even Rs 220 per kg of natural rubber,” the company’s marketing director AS Mehta told newspaper The Economic Times.
Expansion work at JK Tyre & Industries’ facility in the city of Mysore and its new project near Chennai will be completed this year and are expected to help the company secure more than 20 per cent of India’s tyre market. Speaking to the Hindu Business Line newspaper, company marketing director A.S. Mehta said the two projects would help the company attain a higher market share through raising the Mysore plant’s capacity from 800,000 to a million tyres a year and from the 400,000 tyres a year expected to be coming out of the new Chennai plant by the end of 2011.
Prices for JK Tyre and Industries products will increase by up to five per cent in the New Year as the tyre maker seeks to offset climbing raw material costs. India’s The Economic Times reports company vice chairman and managing director Raghupati Singhania as disclosing during the JK Tyre-organised Indian Car and Motorcycle of the Year awards that “we will increase tyre prices by four to five per cent from January to offset surging raw materials costs, especially natural rubber. Singhania added that the price increase applies to both passenger car radial and truck tyres and JK Tyre may implement further price rises should rubber prices continue to increase.
Dr. Raghupati Singhania, vice chairman & managing director of JK Tyre & Industries, was awarded ‘CEO of the Year’ by the Asia Pacific HRM Congress 2010 at a function held in Bangalore, India on September 3, 2010. The citation of this award to Dr. Singhania describes him as a prolific visionary and an entrepreneur who has a fondness for technology and innovation.
Sales of cars in India are booming – in August alone, sales figures rose one-third to a record high. Tyre makers are benefitting from these buoyant conditions, and to accommodate growing demand JK Tyre & Industries is planning to effectively double its passenger car radial capacity by the first quarter of the 2014 financial year. To reach this target, JK Tyre has earmarked some Rs 15 billion (£209.3 million), a large portion of which will go towards erecting the company’s greenfield plant in Sriperumbudur, near Chennai.
India’s JK Tyre has told the country’s Economic Times that it will likely increase the price of its product range by a figure of up to 4 per cent. The rise would be put down to higher costs, especially natural rubber. The online report also said that JK Tyres’s prices have risen by more than 10 per cent since May.
India’s JK Tyre & Industries looks likely to increase its tyre prices by four to five per cent before the first week of September in order to offset the rising cost of rubber. The company’s marketing director A S Mehta commented that rubber costs have put the tyre maker under increasing pressure in recent times and the proposed price increase will apply to all tyre segments. JK Tyre last increased prices in July, when a three per cent rise was implemented.
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