Japanese tyre maker Yokohama to invest $100 million in India over 1-3 years

Visakhapatnam: Japanese tyre maker Yokohama plans to invest close to USD 100 million (around Rs 950 crore) in India in the next 1-3 years as it sees higher demand for SUV tyres going forward amid the boom in passenger car sales, particularly post the GST reforms in September last year, a top company official said.

The official also said that Yokohama India expects its next phase of growth in tier 3 and tier 4 markets and its focus would be on these cities.

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Earlier, the company unveiled a new premium tyre range, GEOLANDAR X-CV, for crossovers and premium SUVs.

"What we are going to do is we will go from 4.5 million tyres to 6.3 million tyres and that would require certain investment. Close to USD 100-million (around Rs 950 crore) we will put in to get to the next level of capacity in the next 1-3 years," Nitin Mantri, Member of the Board and Senior Managing Officer & Co-COO of Yokohama Rubber Co. Ltd and Chairman of Yokohama India Pvt Ltd told PTI in an interaction.

Mantri said investment would also depend on how the market evolves and added that "If we get into more OE (Original Equipment) positions, we will go faster. If we see (demand) in the aftermarket, we'll do as gradually as we go now."

Yokohama India currently has two manufacturing facilities, one each in Bahadurgarh (Haryana) and Visakhapatnam (Andhra Pradesh). The company currently has a capacity to produce 4.5-million tyres per annum.

He said that the company has already invested close to Rs 2,000 crore so far between the two plants in the PCR segment.

Mantri said that earlier the company's focus has been mainly in the aftermarket, growing till recently at about 10 per cent faster than the industry and added that, "If the market was going at let's say 3-4 per cent, we were growing at 14-15 per cent for the last three to four years."

In the last six months, he said, post the GST reforms, the passenger car (SUV) industry is booming 15-20 per cent and that has an effect both on the OE shipments at present and also hopefully as the population goes up to three years down the road.

"We would see a lot more demand for the tyres, so we are excited about the India market, and we continue to get even more excited with the market, " he added.

Originally developed for luxury SUVs with wheel sizes above 18 inches, the same technology is now being introduced from 16 inches onwards, bringing premium performance for a wider range of crossover SUVs in India, the company said at the launch.

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With 32 planned sizes spanning 16- to 20-inch wheels, GEOLANDAR X-CV will be the most extensive, dedicated tyre pattern for crossover and premium SUVs, it added.

The new GEOLANDAR X-CV range, which is EV compatible, is designed to accommodate the higher vehicle weight and instant torque characteristics of EVs, while maintaining durability, extended tyre life and refined driving performance, Yokohama India said.

"India continues to be one of Yokohama's most strategic markets globally. Our continued investments in manufacturing, technology and premium product development reflects our confidence in the country's long-term growth," Mantri said at the launch.

The launch of GEOLANDAR X-CV reinforces the company's commitment to bringing globally proven innovations closer to Indian customers while strengthening Yokohama India's position as one of the country's leading premium tyre manufacturers, he added.

"The crossover SUV segment is growing rapidly and the road infrastructure is improving, now motorists are seeking a balance of safety, comfort, quietness and long-lasting performance. With the GEOLANDAR X-CV we're bringing flagship premium tyre technology to a wider base of crossover SUV owners," said Harinder Singh, Managing Director and CEO, Yokohama India Pvt Ltd.