French tyre maker Michelin on Wednesday asserted it had got the timing right to set up a manufacturing base in India.
Though the radial tyres constituted just around 14.5 per cent of the Indian tyre industry, this percentage is expected to reach 50 per cent by 2020.
Given this projection, Michelin felt that its decision to set up a radial tyre production base near here could not have been better timed. Michelin is hoping to ride on the `radialisation’ wave in India.
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Michelin India Tamil Nadu Tyres Pvt. Ltd., a subsidiary of the French company, is setting up a manufacturing unit at Thervoy Kandigai Industrial Park in Thiruvallur district. The plant, expected to see an investment of Rs.4,000 crore over a sever-year period, is on course to go commercial in November 2012.
According to Nicolas Beaumont, Managing Director of the Indian venture, work is apace at the site on the 290-acre land allotted to it by SIPCOT on a long lease. Addressing a press conference here on Wednesday, he asserted that Michelin was committed to India. The Michelin Training Centre was the first building to go operational at the site, he said, underscoring the French major’s belief in growing with the community around the site.
The upcoming plant, he said, eventually would have capacity to produce 20 lakh radial truck tyres. ``This facility could become the biggest factory ultimately for Michelin,’’ he pointed out.
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Answering a wide array of questions, he said the Indian subsidiary had 365 people at the moment. This number would go up to 500 by the year-end. Eventually, the Chennai operations would have a headcount of around 1,500, he added. In the first year, he expected the Tamil Nadu facility to churn out three lakh radial truck tyres. ``Our expansion will go along the growth of radial market in India,’’ Mr. Beaumont said.
The training centre would impart soft skill and technical skill training to help improve the employability. It would also provide language training. The ambit of the training would be expanded to include computer skills, accounting and other vocational courses such as plumbing and carpentry.
To a question, he said there were three aircraft tyre makers in the globe. ``The Indian aircraft market won’t be in a position to support an Indian aircraft tyre making factory,’’ he added. Queried as to why Michelin preferred to break into the Indian truck tyre market first and not the car tyre field, he said the car industry required a huge variety of tyres. This had its own constraints, he pointed out.
He insisted that the wage cost in India was far less when compared to the European wage. Quizzed if Michelin would eye exports from Indian factory, he said the French company was setting up a base in India to service primarily the domestic market.