Indicating this in an interaction with The Hindu here on Sunday, Herve Dub, CEO of Michelin India Tyres Ltd. said, "we are in discussions with some OEMs. There will be some good news on this front in 12 months.”
Michelin had strong links with OEMs globally. This would help it to forge relationships in the Indian OEM space, he said. There was room for more players, though the competition in the Indian tire industry was tough.
Michelin is the OEM supplier to Volvo’s Mark II vehicles. The company, he said, had initiated discussions with some truck manufacturers to become its OEM supplier. Currently, Michelin was importing tires from its Chinese plant to service the truck and bus markets in India. For the replacement tire market for cars, the tires were sourced from its facilities in Thailand, he added.
Dub was here to inaugurate Michelin’s first Priority Partner Outlet (Lal Enterprises). Mumbai, Pune, Kochi and Coimbatore, too, have Michelin Priority Partner Outlets (MPP). "These (MPP outlets) are the first shops of the kind in India,” he said. They offered a new shopping experience, where the environment would be clean and professionals would be providing right advice and guidance. These outlets would promote Michelin’s `boutique’ products, he added.
The Indian tire field has been dominated by the `bias’ (nylon cross-ply) market, comprising close to 99% of the tire industry. Michelin, on the other hand, was a dominant player in the radial segment, he said. He cited the road conditions, overloading of trucks, poor upkeep of trucks and the structure of truck ownership among the reasons for the dominance of the Indian market by bias tires.
Dub said that Michelin’s decision on a production base in India would also have to take into account the pace of `radialization’ of the tire industry. "We need a critical volume,” he said, pointing to Michelin’s aggressive promotion of radial tires in India.
In this context, he said Michelin had only postponed and not cancelled its plan for setting up a production unit in India. Nothing had changed drastically since Michelin had made an announcement some time ago on the subject after buying out Apollo Tyres in the joint venture, he pointed out.
Following the buy out of Apollo Tyres, Michelin India Tyres Ltd. has become a fully owned outfit of the Michelin Group.
