CEAT plans first Sri Lankan-built Truck Bus Radials
A state- of- the- art plant in Kelaniya to build Truck Bus Radials (TBRs) by CEAT Kelani Holdings PLC will happen in two years when the company will pump Rs. 3 billion to this venture along with other expansion plans, top officials say.
The company’s Chairman Chanaka de Silva told media recently that the first ever domestic production of TBRs in Sri Lanka will lead to import substitution, substantial saving of foreign exchange, the transfer of the latest international know-how and technology for the manufacture of these tyres and that they aim to build TBRs designed and built for local conditions. CEAT Kelani Holdings Managing Director Vijay Gambhire told media that the company aims at rapid radialisation (more TBRs) of the local market while going up the value chain.
“We now want to increase to higher sizes in tyres and get into more sophisticated products,” he said noting that of the Rs. 3 billion they aim to invest, 70 per cent will be through borrowings and the balance is internally generated.
This firm is the most successful joint venture benefitting from the Indo-Lanka FTA, he said adding that the 20-yearold joint venture’s cumulative investment in Sri Lanka todate totalled Rs. 5 billion. “This new investment is part of CEAT Kelani’s Investment Master Plan in Sri Lanka and is projected to generate a substantial increase in turnover over the next three years from Rs. 10.5 billion in 2016/17,” Mr. de Silva added. New machinery is already on the way from Europe and when commissioned in June- July 2018 will commence the production of Truck Bus Radial Tyres. The company also plans to double CEAT Kelani’s Passenger Car Radial ( PCR), Van and SUV radial tyre production from a current 500,000 tyres a year to 850,000 a year, Mr. Gambhire said. The company’s motorcycle tyre manufacturing capacity, currently at 375,000 tyres a year, would also double as a result of the investment, Mr. de Silva noted.
Mr. Gambhire said that CEAT brand currently accounts for nearly half of Sri Lanka’s pneumatic tyre requirements and exports about a third of its production in Sri Lanka. “Our market share in the Passenger Car Radials segment is steady at 32 per cent, and we enjoy a 51 per cent share of the market for Truck and Light Truck tyres. The rapid ‘radialisation’ of the commercial tyre segment in Sri Lanka makes us confident that this is the ideal time to invest in expansion of production capabilities.” The company also plans to increase its focus on developing products based on functional and performance platform such as fuel saving long tyre life and premier performance, Mr. Gambhire added.