Seven years after it entered the Indian market in 2007, Japanese tyre major Yokohama has started local manufacturing at a new plant in Bahadurgarh, Haryana. The company has also launched its first tyre designed specifically for India, highlighting its strong focus on India. Takeshi Fujino, Managing Director, Yokohama India sat down with us to talk about the new plant and tyre and the strategy for the years to come.
Importing tyres sufficed in the initial years, when demand was limited but as the demand grew, it became clear that a local manufacturing set-up was the need of the hour. In addition, the management at Yokohama India also realised the importance of an India-specific tyre, a recipe which has worked well for most of its competitors.
As a result, the company invested over ' 300 cr in the new facility, which is presently carrying out trial production. Regular production is expected to begin in July 2014, and by 2016, the plan is to scale up production to about 700,000 tyres per annum. Fujino talked about ramping up production by about four to five times of 2016 level in the long run, without giving out a specific time line. That would depend on a lot of factors such as market demand, he said.
The tyre to be made at the plant for now is the newly developed Earth-1. In some time though, the company will also add the S Drive range of tyres to local production. This will allow the company to target mass-market and premium cars in the country.
Purely focussed on the aftermarket for now, the company intends entering the OE segment at a later stage. Fujino sounded apprehensive of committing timelines, and said the present grim situation of the industry might not be the right time to negotiate for business. The company will instead focus on utilising this time to improve its production efficiency and strengthen is market presence.
The company currently has a marketshare of about two per cent in the Indian aftermarket, and the plan is to increase that share to five per cent by about 2017.
At this stage, Yokohama accounts for about a million units in sales annually. Although, two-wheelers account for massive volumes in the Indian market, Yokohama has no plans to re-enter a segment it gave up globally about 15 years back.
The Earth-1 tyre range, specially developed for the Indian market, was designed to handle the varying road conditions in India, said Fujino. The tyre, completely developed in Japan features a nano blend compound, prepared specifically for this tyre. By increasing the ratio of polymer and carbon, the company claims an improved wear resistance on rough roads, increased resistance to chipping and lower wear. The company carried out some trial tests in India to check for real world performance, said Fujino.
The tyre's construction was designed to offer a balance between durability and comfort, added Fujino. A two-ply construction is claimed to improve stability and steering performance, while the reinforced tread portions improve reliability on rough surfaces. The tyre also features a thicker sidewall to help absorb impacts. The tread too is designed to offer good grip on dry and wet surfaces along with lower noise.
Tyres are presently being imported from Philippines in six sizes for 14- and 15-inch wheels. When asked about tyres for A-segment cars, Fujino said local production will involve 25 sizes across 13 to 16 inch wheel sizes.
The S Drive tyres, when produced at the Indian plant, will sport certain changes made to them in order to handle Indian conditions better, Fujino informed. Production of this range will start in December 2014 or early next year and there will be about 10 sizes on offer, he added. For the time being though, Yokohama India has no plans of using India as a centre for product development. That could be considered once volumes justify such investments, Fujino said.
Text: Arpit Mahendra