Apollo, Michelin JV to begin production in 2006

Apollo Tyres' $100 million project in joint venture with Michelin would begin production from early 2006, its chairman and managing director Onkar S Kanwar on Tuesday said.

"We have already started the construction work of the joint venture project at Pune and hope to be operational by early, 2006," Kanwar said in Kolkata.

Apollo will manufacture truck and bus radial tyres in technological partnership with Michelin at the upcoming site.

Kanwar said the tyre industry was witnessing a lot of buoyancy and was able to register a growth rate of 10 per cent. "We will be able to maintain the double digit growth, if the GDP of the country grew by seven per cent as well."

Apollo had entered into a partnership with Michelin, the world's largest tyre company by offering 14.9 per cent of the Indian company's stake to it at a price of Rs 236 per share last year.

Kanwar said by virtue of offering stake to Michelin, Apollo would be partner in the future growth category of truck and bus radial tyres with a company that had developed and refined the technology to a very high standard.

Asked to comment on the company's export performance, the CMD said their export was going up.

He said last year was difficult for the tyre industry because of rising cost of natural rubber in the domestic market because of increased export subsidy.

This had affected exports because of competition from China. The situation was such that China was able buy Indian rubber cheaper than Indian companies.