What’s new is the announcement that in less than a year a full range of Apollo tyres will be launched into the European market. The newly merged Apollo Vredestein will be responsible for sales and marketing of all group brands in Europe. Of course, when it comes to making major changes to the Apollo brand strategy this will have to be done in consultation with Delhi, but to all intents and purposes Vredestein will be masters of their own and Apollo’s destiny within the bounds of the continent of Europe and the U.S.
In return, Apollo will take the lead when it comes to selling Vredestein-branded tyres into the new Asian market territory the recent combination of the two companies brings.
Asked where the Apollo brand will sit in the combined company’s product portfolio, Apollo Vredestein CEO Rob Oudshoorn pointed out that that decision has not yet been finally made. However, he also commented that Apollo “is certainly not a third tier brand.” This leaves Apollo Vredestein with a quandary: how can the company continue with the successful development of its Maloya and Vredestein brands and also introduce Apollo to the European market, without relegating one of them to bottom of the pile?
It is unlikely that Apollo’s management will want to aim the brand that – in India at least – is seen as a premium product at any level lower than Vredestein. However, Vredestein has only got to the position it has after 15 years of brand investment and product design and development, so it would also be a mistake to rush the Apollo brand’s introduction. That’s why Oudshoorn explains it is likely to be six to 12 months before a complete (summer, winter, all-season) range of Apollo’s latest generation of passenger car tyres will be launched into the European market.
Apollo and Vredestein’s marriage offers key synergies in the areas of production and research and development. According to Oudshoorn this includes the production of around 500,000 lower segment Vredestein group tyres outside Holland in South Africa (at Dunlop International) or in India. From the outside the choice appears to be primarily between Apollo’s Dunlop International factory in Ladysmith passenger tyre plant (77,000 square metres; 25,000 tonnes tyres/year) and the new Chennai plant which is expected to produce up to 30,000 passenger car tyres/day when production reaches full speed, although there is also the company’s existing Baroda facility. While the final decision hasn’t yet been made on exactly where these tyres will be produced, it will require a significant technology exchange between the two companies not dissimilar to the kind of technology project Vredestein completed in just six months at Amtel’s Kirov plant.
Greeting all his friends in South Africa (in addition to working with Dunlop International managers as a result of the Apollo combination, it is worth pointing out that Oudshoorn also spent four years working as a Michelin director in Africa earlier in his career), Oudshoorn explained that the first stage of the ‘know-how’ integration will come in the form of an R&D exchange with engineers from India spending time in Enschede and vice versa. The Indian R&D team’s particular strengths are said to be in computer modelling and IT systems: “In this area we are good, but in some respects they are better,” Oudshoorn commented. (Tyres & Accessories/Staffordshire, U.K.)
