Company Description: Michelin
came to India almost a decade ago and today markets its range of tubeless car
radial , tubeless and tube type bus and truck radial tyres. These tyres
produced for the Indian market contain the best Michelin technology and have
carved a niche for themselves in the marketplace. Today, Michelin in India
offers product for India market for passenger cars, truck & bus, two
wheeler & OTR (Off the Road). With an investment of 4,000 crore over a
period of 7 years, the manufacturing facility in India is being set up on 290
acres of land, allotted by SIPCOT. With
a global market share of 15.5pc, Michelin has been equipping vehicles in India
for almost a decade and today markets in India a full offer of radial tyres for
two wheel, passenger car, trucks and buses, agriculture, construction and
You had your stint with the
FMCG industry. Thereafter, you joined
Michelin. Did you see a lot of potential
in this industry?
I joined here because Michelin is an iconic brand. It is
a dream-come-true for every marketing personnel to work for big global giants
like ours. That is perhaps the primary reason why I joined Michelin. And I
bring with me an experience from different industries, which is an added
advantage. I have been in Michelin for the last couple of years and it’s been a
very satisfying experience for me. And this is not for the first time that I am
in the automobile affiliated industry. I have worked in Castrol before. So I
have some background about this industry.
How established is Michelin
in India? Are you worried about well-entrenched players here?
I will answer this question in two different facets. As
you know Michelin is a global brand and also a leader in the industry when it
comes to innovation and its ability to churn out new products consistently, and
also new technologies that are brought into this industry. Many of them are the
first from Michelin. From that point of view, if you ask me whether it will be
difficult to tackle the fairly-entrenched players, I think we are capable
enough of getting tyres that are required for this particular market. The
conditions, the consumers, vehicles, etc will be getting addressed in terms of
how we build our product. So I really do not see any big worry. Everybody
recognises the fact that if the growth is going to happen here, the right
amount of investments will get done here in the industry. As far as our product lines are concerned, we
have already announced a factory establishment with a 4,000 crore investment in
Tamil Nadu. That facility will be our flagship
factory and will be manufacturing truck and bus tyres. We are also present in
the Indian market with the passenger vehicle tyres and two-wheeler tyres also.
However, all of them are imported, but made to suit the conditions of the
Indian market. Every data is collected from here to manufacture tyres that will
work in these conditions.
How important is the Indian market for Michelin?
Do you see a foreseeable growth here?
Well everybody knows that India is an emerging nation. It
is a fast growing market with a huge amount of growth witnessed in the
automobile industry. From that viewpoint, Michelin is definitely looking at
India as a strategic market. Therefore, we are setting up a geenfield facility
Does the Chennai plant cater to the domestic
market alone or does it produce tyres for the export markets also? If yes, which
are your main markets?
The idea is to cater to the domestic market as much as
possible and then look for other options. We have been studying the Indian
market for a fairly long period of time. And we are now confident in terms of
manufacturing products for the Indian market. This is because of the huge surge
in demand here. So it will cater to the domestic market more than the overseas
markets. We can safely assume that upto 90-92pc of our local production will be
catering to the domestic market over a period of time.
Peugeot, which sources
tyres from Michelin globally, has made known its plans to enter India. Other
car majors too are planning to make big-ticket investments in India. Does it
all mean enhanced business for Michelin?
Right now we have tied up with Mercedes and Honda in the
passenger vehicle segment. On the truck side, we supply to Volvo. As far as new
OEMs are concerned, we constantly look at these opportunities as and when they
come in terms of volumes so that we can synergistically tie up with them. These
new entrants will obviously mean enhanced business opportunities for us.
How strong are you in the
CV & LCV segments?
The big piece of the Michelin story is our desire to
drive radialisaton in the Indian CV industry. What is going to be the key
driver is the shift in market from bias tyres to radial tyres with better
infrastructure that we see on Indian roads. And that is where we believe we
will be at the forefront of driving this radialistation process. From that
point of view, the plant will bring the desired number of quality tyres, both
in the LCV and HCV segments. To popularise our products and to promote
radialistaion, we have kickstarted a process called ‘Michelin Caravan’, wherein
an open truck is plying across the length and breadth of the country visiting
various transport hubs. The basic objective is to communicate the advantages of
using Michelin radial tyres. It tells the benefits the drivers and fleet owners
can derive out of it. And what we talk about is the increased fuel savings one
can get out of it and also the enhanced safety levels of Michelin tyres.
The increase in rubber
prices and other raw materials has hit the bottom lines of several tyre majors.
How has it been for Michelin?
You are absolutely right. There are times when the
rubber prices have gone up substantially.
Moreover, rubber is a major ingredient of a tyre. There is an extent to
which you can absorb costs beyond which they need to be passed on (to the end
users) to cover your rising costs of doing the business as well. But all said
and done, what Michelin looks to do is always
price its products and bases its
benefits it offers to its end customers, whether it is on the truck side or the
passenger vehicle. That is always borne in mind while pricing the products,
because benefit is the main virtue of selling a Michelin tyre.
What are Michelin’s efforts
towards protecting the environment? Are the technologies adopted by you, green?
I think Michelin was the first tyre to go green way back
in 1996 when the GreenX technology was developed. This was the first tyre to
actually promise fuel-savings on the tyre. And Michelin has been the pioneer on
that front because when I say 1996 it’s actually 15 years older. So from that
point of view, Michelin has been very conscientious in its efforts towards the
Lastly, do you have plans
to have big-ticket shows in India, like the Bibendum challenge show organised
It is organised in different parts of the world. This
year it was in Berlin, last year it was in Rio. Every year this initiative is
organised so as to bring to a common platform various other companies which are
on similar lines thinking of how to look at ‘Green’ as a virtue in terms of the
auto industry. Michelin is always looking for partnering efforts on that side.
Looking at how India as an emerging nation will grow in the years to come,
these kinds of initiatives can also be rolled out in India.
A lot of domestic and
multinational OEMs companies are lobbying with the government to impose
anti-dumping duties on Chinese tyres. What are your views on that?
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