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France-based tyre manufacturer Michelin Group on Monday signed an MoU with Tamil Nadu government for setting up a Rs 4,000-crore (Rs 40 billion) manufacturing facility in Tiruvallur district near Chennai.
The facility would create direct employment for 1,500 people, Michelin Africa-India-Middle East president Prashant Prabhu told reporters.
"Michelin is extremely grateful to the state of Tamil Nadu for making it possible (for us) to have access to land and infrastructure to be able to build our factory," he said after exchanging documents with Chief Minister M Karunanidhi and state government officials at the Secretariat.
Michelin would manufacture radial truck and bus tyres and the plant would start operations in 2012.
Prabhu said the factory would be built up in phases on 290 acres at Thervoy Kandigal in Thiruvalluvar district about 50km north of Chennai.
On production at the facility, Prabhu said it would be focused on serving the domestic market.
On choosing Chennai to set up its first facility in India, Prabhu said, "We have customer proximity as Chennai offers very good multi-modal connectivity and also it a very good talent pool from which we expect to recruit staff for our factory".
Michelin currently has 1.10 lakh (110,000) employees worldwide and has sales offices in 170 countries.