'Price Range Of Chinese Tyres Looks Quite Competitive, But The Business Impact For Us Is Minimal
In an interview with BW Businessworld, Kazutoshi Oyama, Executive Director- Sales & Marketing, Bridgestone India, talks about the importance of the Indian market and the journey so far
1. How would you describe Bridgestone’s 20 year journey in the Indian market?
Bridgestone India’s 20 year journey has been a tremendous one filled with challenges and success but also truly fulfilling. In the past decade, India has seen anincredible growth in the automobile segment. Bridgestone has been able to spearhead its contribution in this booming passenger car market and has become one of the preferred OEM suppliers to major car manufacturers in India.
To facilitate this increasing demand of the Indian market, Bridgestone set up its first manufacturing plants at Pithampur in Indore in the year 1996 and set up its second plant in 2013 at Chakan near Pune to further strengthen the supply capacity in India. We launched our TBR tyre in 2006 and started full-fledged production from 2010.
These two strategically located plants help to leverage the production of world-class products using highly advanced technologies with the intellectually driven workforce.
In the last 20 years, Bridgestone has successfully positioned itself as the leading premiumtyre brand in the country with a strong foothold in both the PSR and TBR vehicle segments. We wanted to expand our customer base and hence launched ‘Firestone’ brand for the value seeking customers with uncompromising quality products in India. We announced our entry into the two-wheeler market with ‘Neurun’ considering that we are already strong players in the PSR and TBR segments.
2. How important is Indian market for Bridgestone? Can you detail about your investment plan in coming years?
India’s automobile sector is one of the fastest and largest growing globally. This supported by the growth in Indian economy and business makes India a significant market for Bridgestone.
India has always been an important market for Bridgestone and we have created a niche with our product range and services. We have 600+family channel stores in over 200 Indian cities, which highlights Bridgestone’s business vision for the Indian market. We are excited about Bridgestone’s growth opportunities in the Indian market and are keen on growing our tyre business further with our plants in Pune and Indore.
In terms of investment, we do not have any concrete plan as of now.
3. Please share your bottom-line and top-line for the fiscal 2016-17 and growth expectation from the present financial year.
The journey so far has been tremendous for Bridgestone as we witnessed steady growth as planned and we continue to be the leading tyre brand in the Indian market. We also saw some vital product introductions to the industry like our flagship tyres Potenza S001 and Turanza T001, the launch of our motorcycle tyres “Neurun”.
Our key launch was Firestone, the legendary American brand of tyres. Firestone is targeted at customers who value seeking with uncompromising quality products.
2017 will be another excellent year like 2016 for Bridgestone India especially with Ecopia our eco-friendly product range andFirestone our value-seeking products.
4. Do you have any plans to increase your manufacturing capacity and enter new segments?
Our current facilities competitively cater to all tyre requirements of the country and there is no concrete plan to increase our manufacturing capacity in India as of now.
As it all depends on the importance of prioritising business opportunities, we will decide the next step based on market conditions and entering new segments.
5. What has been the impact of cheap Chinese dumping on the company and on the Industry and how are you dealing it?
We saw a huge number of tyres imported from China last year in especially in the TBR segment, however, post demonetization these imports seem to be stabilized. The price range of Chinese tyres looks quite competitive, but the business impact for us was minimal.
6. Is it challenging to grow in the Indian market as there is some intense competition and what differentiates you from other players?
Yes, market conditions are challenging but we cannot grow without healthy competition so we welcome it openly. Our objective is to provide quality products supported by fierce R&D and marketing support. We will continue to expand our channel network and cover the remotest corners of the country for our PSR and TBR segments and provide our customers quality products in a timely manner.
7. How will tyre industry get impacted when new emission norms will come into play? What are your preparations?
The new emission norms will be instrumental in improving the environmental condition. The growing carbon emission is a big concern and tyre manufacturers need to keep pace with changing global trends and the challenge is to create the right products.
Bridgestone has been the front-runner in introducing eco-friendly tyres globally. Bridgestone India has already launched such global eco-friendly Ecopia range for passenger car and TBR vehicle segments.
We are undertaking many initiatives to reduce emissions and improving fuel consumption by introducing products with innovative eco-friendly tyre technology in the Indian market.
8. What has been the impact of Raw material price fluctuation on the industry and your company?
Fluctuations in raw material pricing impact the tyre industry. This, in turn, can affect the demand and thus profitability creating a negative impact.
With the price fluctuation, the challenge remains of how to widen the profit margin.
However, the acceleration in the automobile sales and demand in replacing market will help in improving the challenging scenario of tyre industry with such price fluctuations. We will prudently monitor raw material pricing trends to ensure that we can take appropriate action to continue supply and cater to customer requirement.
Bridgestone is a global brand and has the expertise and technologies to steer the growth through this challenge.