The automotive sector may not be in top gear yet, but that’s not stopping the world’s fourth largest tyre manufacturer from ramping up its production in India. Continental Tire says it is yet to see changes on the ground in terms of the ease of doing business but hopes the new government will walk the talk, reports CNBC-TV18’s Sajeet Manghat and Gopika Gopakumar.
Earlier this year, Continental Tires as part of its annual outlook for countries it operates in painted a grim picture for India. It included rising inflation, interest rates and a slowdown in growth as key concerns. However hope is back on the horizon, as the auto sector slowly gets back on the path to recovery. Even as the government promises to improve the climate for doing business, the company believes, India still has a long way to go.
Nikolai Setzer Member – Exec Bd (Tire Division) Continental Corporation, says, “The administration efforts in all areas and barriers are higher than what we see in other countries. So, there is not one specific item that needs to be tackled there are various items to be individually tasked. As India is different from other countries you cannot copy paste what others are doing.
Continental expanded its Modipuram facility with a capacity of 800,000 tyres expandable to a 1 million tyres. It acknowledges its been a late entrant into the Indian market, but that doesn’t stop world’s fourth largest company to leverage its global relationships with OEM players for traction in Indian market.
“We heavily invested into India as well our manufacturing site in order to supply to our local markets to be fast close to the customers supplying the needs which we want and being reliable. This is achieved and this is check marked and what we need to do now is ramping up the facility and ramping up the local market. Whether at a later date we are at a position to export tyre for those needed outside India remains to be seen”, says, Setzer.
Continental which has been focusing on the premium segment of the market, has now started catering to the mid-sized segment. It is aggressively looking to expand both its passenger car and commercial vehicle dealerships and though Asia today only accounts for 9 percent of global revenues, it is betting on India to drive revenues from this part of the world.