The Hindu : Kerala News : Apollo Tyres considering outsourcing

Online edition of India's National Newspaper
Friday, Apr 22, 2005

Kerala

Kerala

Apollo Tyres considering outsourcing

Staff Reporter

KOCHI: Apollo Tyres, planning to invest a total of about Rs. 150 crores in its Baroda and Perambra facilities this year, is considering outsourcing non-critical activities and another round of voluntary retirement offer at its mother unit in Kerala as it braces up to face rising input costs.

The chief operating officer of the company, Neeraj Kanwar, told reporters here on Wednesday evening that the automotive tyre industry had to put up with about 16 per cent rise in cost of inputs last year.

Prices of natural rubber and crude were ruling high and looked like remaining at these levels in the near future. This called for improved efficiency and better productivity.

Import of tyres

Along with the rising cost of production, import of new tyres from China, Thailand and Korea posed another problem for the automotive tyre industry in the country, said Mr. Kanwar.

To counter the rising cost of natural rubber, said Mr. Kanwar, the tyre industry would be forced to import about 12 per cent to 15 per cent of the industry requirement this year.

The Perambra unit, near here, was established in 1977 with a capacity of 50 tonnes. The unit will see an investment between Rs. 25 crores and 30 crores during the current year. The unit has the production capacity of 270 tonnes per day. But Mr. Kanwar said that the unit had an excess manpower of about 15 per cent compared to the company's Baroda facility.

Apollo took over Premier Tyres in Kalamassery, near here, in 1995. The plant has a capacity of 280 tonnes but had excess manpower. One way to meet this challenge was to raise production, said Mr. Kanwar.

Farm radials

He said that Apollo was testing farm radials and that they would be in the market soon. Light commercial vehicles was a major growth area even as Apollo led the country in the truck tyre segment.

Apollo Tyres revenues have seen a combined annual growth of 15 per whereas the industry average was 6 per cent.

Printer friendly page
Send this article to Friends by E-Mail

Kerala