Continental announces Rs 330 cr of new investments

Continental, the world’s fourth largest tyre manufacturer, has announced its expansion plans for India. After its formal acquisition of Modi Tyres Company in July, Continental India is now ramping up its operations in both the replacement market and the OEM space.

The company will increase production ay its Modipuram plant beyond half a million bias truck and bus tyres (TBX) this year. From there, TBX production is planned to continuously grow to more than one million units in 2013.

In addition, it has announced further investments of over 50 million Euros (about Rs 330 crore) to start production of radial tyres for passenger cars and commercial vehicles in the second half of 2013.

Nikolai Setzer, board member, Continental AG and Head of the Tyre Division, said, “In India, there is a rising demand for vehicles with high-quality tyres as well as premium technology. Radialisation will be the driving force in the Indian truck tyre market, and our further investments of more than 50 million Euros in radial truck tyre production will prepare a solid base in order to meet that demand.”

Continental also plans to manufacture radial tyres from the Modipuram plant and will generate a plan to offer both radial and bias tyres out of local production. This move will also create jobs as it increases headcount by more than a third from the current 1,600 employees up to 2,200 to 2,400 within the next few years.

At present, Continental has access to 110 regional distribution centres and about 1,400 dealers nationwide that provide access to truck fleets and end consumers.

In July 2011, the acquisition of Modi Tyres Company included the existing TBX plant in Modipuram, the tube plant located in Partapur and all related operational assets to those plants including all customer relationships. Alok Modi, member of Modi Tyres’ founding family will be a board member of Continental India.