Apollo to Import OTR Tyres into India
pollo Tyres is considering sourcing OTR tyres from its acquired South African production facilities in order to meet increased demand from the construction and mining sectors. These tyres will most likely come from the 252,000 sq ft Dunlop plant in Durban, which Apollo acquired in April 2006 along with another facility in South Africa and two in Zimbabwe. Ten thousand tyres are produced every day at the Durban site.
This news was given by Sunim Sarkar, Apollo’s chief of corporate strategy and marketing. In an interview he commented “Though the plan is definite, it is still premature to comment on the numbers. Imports should start in the next couple of months.
“High margin off-the-road tyres make up a large part of Dunlop’s capacity of 150 tonnes a day,” he added. “In India, we are considering options but it is very capital intensive and a lot of capacity is coming in China.” These comments refer to Apollo’s consideration of OTR tyre production at their Indian facilities and hints at the company’s concerns over recovering any investment outlay. Operating margins in India have been squeezed considerably in the wake of rising rubber and oil prices.
Regardless of whether Apollo chooses to invest in OTR production in India or continues to rely on its South African subsidiary, the company will import OTR tyres to meet demand.