According to Florent Menegaux, the company’s Chief Executive Officer, the French tyre manufacturing giant Michelin is actively examining the possibility of establishing a production facility for passenger car tyres in India. However, introducing import limits by the Indian government in 2020 would make it difficult for the prominent tyre manufacturer in Clermont-Ferrand to expand its operations in India, which is now in a critical state. Local production would be of great assistance to the company in this regard.
Currently, the tyre manufacturer, which has a presence in 175 countries across 67 factories, distributes only premium larger-size tyres in India, and only in limited quantities, with an emphasis on selling them to performance-oriented vehicles.
To encourage the production of goods in the country, the government decided to restrict the importation of certain new pneumatic tyres in 2020. These tyres are used in automobiles, buses, lorries, and motorbikes.
Under the terms of a limited import license, tyre firms are now only permitted to bring a limited quantity of tyres into the nation. This was not the case before the year 2020. Menegaux expressed his company’s perspective that India is an excellent emerging market during a conversation he had with PTI here in this city.
He mentioned that the firm is keen to engage in the local manufacture of passenger vehicle tyres in India and that the only thing that needs to be worked out is the time. He noted that the corporation is willing to participate in Indian passenger car tyre manufacturing. Menegaux said, “Now we are reaching the moment where it will make sense to invest in the passenger car capacity” in India. To provide more explanation, he stated that because the firm has a presence in several countries around the world, it must thoroughly examine the various investment opportunities in each place. Because we have investments worldwide, the question is if this is the best time to invest in India. According to Menegaux, “The question is not whether we should invest in India; the question is when we should invest there.” When we pressed him for further information on the new investment’s timeline, he responded, “It is under process right now.” Menegaux noted that the Michelin group views India as an excellent market still expanding, particularly concerning its infrastructure.
“With proper infrastructure in place, the speed (of vehicles on roads) will increase, and the relevance of our technology will be even more visible,” he added. “Our technology will be even more relevant.” Michelin is currently active in the Indian market to produce radial trucks and bus tyres. It operates a manufacturing plant in Chennai, which has a capacity of more than 30,000 tons per year once fully operational. The facility’s primary focus right now is on producing a variety of radial truck and bus tyres and defence tyres for the original equipment manufacturers (OEMs) in the nation and the replacement market there. In addition, Michelin works with a local partner to have two-wheeler tyres produced nationwide.
Menegaux stated that it was a bit disheartening for the firm, as they were expanding operations in the nation when the government of India set limitations on imported tyres. “Importing goods has been our standard method of conducting business for many years, and during that time, we had built up a healthy market for passenger cars. So everywhere we go, we begin by bringing in products from other countries until we reach a certain amount, at which time we begin producing our own,” he explained.
Menegaux remarked that setting limitations on imported tyres was most likely not the best course of action, even though he praised the policies of the Indian government as being outstanding. In addition, he requested assistance from the government in the protection of the intellectual property (IP) ecosystem. Because “we invent a lot and we innovate a lot,” he said, “protecting our intellectual property is essential for us.”
Menegaux observed that the business, which has over 1.32 lakh employees worldwide, is continuing to invest in various capabilities in India. We have established a large centre in Pune as a global artificial intelligence research and development hub. There are further efforts in research, as well as digital services. According to Menegaux, “We employ over 2,300 people throughout the country.”
The Michelin group, which manufactured over 200 million tyres globally in 2022, has established a target date of 2050 to use only sustainable materials in all of its tyres. The firm just introduced two new tyres, one for automobiles and the other for buses. The car tyre has 45 per cent sustainable ingredients, while the bus tyre contains 58 per cent sustainable elements.
“We will tackle the difficulties of the changing tyre markets owing to industrial facilities that place people at the core of their operations, that are ever more inventive, and that are more ecologically responsible. Menegaux said, “We are confident that we will achieve our strategic goals: with, around, and beyond tyres.” He presented an overview of the company’s objectives and plans at the Michelin site in Cuneo, Italy, Western Europe’s largest automobile tyre manufacturing plant.