2012 Radialisation IndiaTransportPortal

Special Issue April, 2012
April, 2012
INSIGHTS & ANALYSIS
RADIALISATION IN INDIA
India Transport Portal, 2012

0 India Transport Portal
Table of contents
Click on the article you wish to read to reach it directly. Click on the link back to table of contents at the end of each article to come back at the articles list.
Articles:
The rise of radialisation in India Impact of Chinese radial tyre on India Different types of radial tyres Radial tyres and fuel savings The other lives of radial tyres The progress of radial technology p.2 p.5 p.9 p12 p.16 p.19
Interviews:
JK Tyre: The only way to compete is to provide quality tyres Dr. R. Mukhopadhyay, Director (R&D) p.22
ATMA: The Daimler choice speaks volumes about the quality of Indian tyres Mr. Rajiv Budhraja, Director General p.25
Clean Air Initiative: Long range trucks have the greatest potential for fuel savings Mr. Parthaa Bosu, Head of Indian Office p.28
Apollo Tyres: The faith that customers shows in our products is a testimony Mr. Satish Sharma, Chief India Operations p.29
CEAT: CEAT TBR became instant success Mr. Vinod Kumar is Vice President Marketing at Ceat Limited p.32
Michelin: 76 billion liters of fuel can be saved with Michelin tyres Mr. B. Kumar, Country Head Distribution p.34
Credits
Rise of radialisation
The rise of radialisation in India

The Passenger Car Radial (PCR) level is almost at 100% but the Truck and Bus Radial (TBR) level is way behind. Looking at the current trend in TBR, the reasons for the recent growth with the focus on what thwarted the previous growth in this sector. How can radialisation play an important role in providing sustainable mobility and where the trend is heading towards?
The worlds tyre industry is now converging towards radial trends that constitute one of the biggest technological breakthroughs in tyre manufacturing. India has also become a party to this world-wide radial revolution. Radialisation is not a new phenomenon in this country. Way back in 1977, radial technology made its debut in India through native manufacturer JK Tyre and since then, there has been a steady penetration of radialisation. The trend, however, has largely been restricted to the passenger car segment. A booming economy coupled with an enhanced level of
The Indian T&B sector currently has a radialisation of 9-10% and the figure is expected to double by FY 2013.
motorization and Original Equipment Manufacturers (OEM) increased radial preferences have taken the PCR level to almost 100%. This same transition has not been witnessed in the arena of commercial vehicles but thanks to a number of structural changes, the laxity has now seen a reversal. In his sector too, especially, in the truck and bus category, radial inroads have gathered significant momentum. The current trend in the T&B radialisation According to a report by ICRA Limited, the Indian T&B sector is
Domestic tyre market share in T&B segment (%)

Source: SMC, companies, 2011
at a structural inflexion point as far as radial trends are concerned. This sector currently has a radialisation of 9-10% and the figure is expected to double by FY 2013.
Apollo
3 19 28
MRF CEAT JK Tyres
This is still a meager figure compared to the worlds average of 68%. This figure will yield hope, nevertheless, if one looks at the previous trends. In 2005 the radial rate in the truck category was a mere 1% - this increased to around 5% in 2008. A steady positive growth over the years is clearly discernable but still the country lags behind even in Asia. In countries like China and Thailand, the shift towards this technology has been quite pervasive. China has registered almost 75% radialisation at an Others industry-wide level. Compared to that, India is still in an embryonic stage.
18 19 13
Birla
Rise of radialisation The driving factors in the recent upward trends in radialisation There were important infrastructural shortcomings in India that made the country lag behind the global trends towards radial convergence. The poor road conditions were a major factor behind the slow development and uptake of tyres with radial technology in the T&B sector. The varied road networks of India, often in an appalling state, were detrimental to the tyres condition and reduced its shell life. However due to systematic overhauls and recent improvements in the road network, the situation has improved. The government has pumped in large capital investment to improve the condition of roads. India is expected to build 35,000 km of roads over the next two years, according to U.S. research and consulting firm Frost & Sullivan. These projects like the Golden Quadrilateral and highways providing connectivity in the North-South and East-West corridors have made the use of radial tyres feasible. Truck overloading was also another issue. It was not uncommon to see trucks that have a maximum capacity of 9 tons carrying around 13 tons of weight, causing irreparable damages to the tyres. The excessive pressure on the vehicle due to this mishandling caused frequent accidents as well. The 2005 Supreme Court judgment brought about a refreshing change in this overloading scenario. The verdict stated that trucks should be loaded only as per the dictates of the Central Motor Vehicle Rules and accordingly the state governments were directed to act. This change has definitely turned the table for radialisation in this segment. The rise of multi-axle vehicles or MAVs further played a catalytic role. These vehicles have increased efficiency of the trucking industry. These new trucks are capable of carrying more loads; around 50% more than what was possible by normal trucks and have redefined freight movement in a large way. With this new vehicle type, hub and spoke transportation has become popular and with the advent of modernization trends in the heavy vehicle segment the drive towards radialisation has become easier. T&B Knowing the benefits of radial tyres PV The lack of knowledge about the advantages of radial tyres also was an inhibiting factor especially in the case of the end users. The initial investment for such tyres is far higher than the other standard types i.e. the cross-ply type. The low rolling resistance force due to the non-crisscross of the plies is one of the reasons for that. Naturally, this tyre can guarantee more Other mileage as well as better longevity than the bias type that involves low investment.
The 2005 Supreme Court judgment stated that trucks should be loaded only as per the dictates of the Central Motor Vehicle Rules. This change has definitely turned the table for radialisation in this segment.
Product Wise Tyre Demand (%)

Source: SMC
8 10
LCV
9 11
57
2/3 W Tractor
Rise of radialisation In the context of the global oil reserve crunch, skyrocketing fuel prices and also high tyre prices, the transition towards radialisation seems to be the best option. The environmental friendliness of these tyres owing to less emission of greenhouse gases is another plus point that can hardly be ignored in the era of global warming. Thus to fulfill the goal towards sustainable mobility, India needs to incorporate fast radialisation trends across all segments of transportations. Where is the radialisation in India heading towards? The current scenario in India definitely looks promising with the infrastructural revamps happening but some other factors also need to be worked out to keep on a positive path. The OEMs effort is also vital in this and their interest towards radial fitting will determine the future of this tyre standard. Tata Motors and Ashok Leyland, the two leading manufacturers in Indias commercial vehicle segment, have come up with new truck ranges like Prima and U-Truck that are apt for radial tyre fittings. The dealers awareness is as critical as that of the endusers because it is from the former the initiative for generating the technical know-how will come. Service of the tyre is another component that the dealer must take care of as an adequate network of service centers can go a long way in promoting radialisation. Leading tyre manufacturers like Michelin who are furthering their radial interest in the country have come up with the plan to educate dealers and especially for end-users to popularize the usage of tyres with radial technology. Clearly, the perception of the tyre manufacturers toward the radial market of India has changed. The earlier capacity constraints of the domestic market, which have paved the way for inferior radial varieties in the country, will no longer
Leading tyre manufacturers like Michelin who are furthering their radial interest in the country have come up with the plan to educate dealers and especially for endusers to popularize the usage of tyres with radial technology.
Tyre Segment Wise Volume (%)

Source: SMC, companies
continue to plague the market, as investing in this sector is no longer a risky affair. Major capital investment plans for capacity augmentation has Export been drawn by Indian tyre companies since 2008. This will reach its peak in the FY of 2013 when the industry is expected to increase capacity by 25%. Foreign makers are also not far behind in the fresh capacity incremental plans. These efforts OEM will stop the entry of bad quality products as well as increase price competitiveness that will further the boom of radialisation. Replacement Words: India Transport Portal Back to table of contents
23
64
13
Chinese radial tyres
Impact of Chinese radial tyre on India

Chinese radial tyres are entering the Indian market. But can a radialisation being done on price and not on quality be beneficial to India?
Radialisation is one of the important structural changes that the tyre industry of India has begun to embrace. The bulk of the passenger car segment (almost 99%) has come under the ambit of this technology and radialisation trends over the years show that of late the commercial vehicle or CV segment has also warmed to the technologically-advanced radial trend. In the truck and bus radial market (TBR) especially, which was
Indian tyre companies have now started to wake up to this technology originally developed by Michelin in 1964 and introduced to trucks and buses in the 70s.
earlier dominated by the cross-ply variety, a positive growth has been witnessed in recent times. It is in this segment that imports from China have made great progress and as early as 2008 Chinese radials came to occupy around 60% shares of the Indian TBR market. Indian tyre companies have now started to wake up to this technology originally developed by Michelin in 1946 and introduced to trucks and buses in the 70s. Taking advantage of the radial capacity constraints of the native manufacturers, Chinese radial tyres gained a strong foothold on Indian soil. The huge demand-supply gap in the Indian market (in 2010
Import trends of TBR
the demand for tyres reached 2.7 million unites and the supply came short by 1.7 million units) opened the door for Chinese products and this has been heavily reflected in radial import
1600 1400 1200 1000
140 120 100 80 Imported radial tyres (In '000 Nos)
figures. If one looks at the import trends of TBRs, a steady positive double digit growth in the last five to six years can be seen with the financial year (FY) 2010 -11 showing a growth rate of around 43%. Competitive pricing structure is the key to Chinese radials
800 60 600 400 200 0 FY07 FY08 FY09 FY10 FY11 Source: ICRA 40 20 0 Growth (%)
success Chinese manufacturers like Hangzhou Zhongce Rubber
Company, Giti Tire Company and Weifang City Gunaite Rubber Co Ltd along with Double Coin, Infinity, Aeolus, Westlake and Super Ranger are predominant in the Indian market mainly because of their aggressive pricing policies. 5
India Transport Portal
Chinese radial tyres China already has a high overall radialisation rate compared to India. In terms of radialisation trends in the truck and bus categories, the world averages at 68%, Asias share is set at 52% whilst India lags behind at about 17% (FY 2012). Naturally Chinese manufacturers will have several cost advantages in their kitty. They have the benefits of economies of scale, which coupled with subsidies from the government, make the landing cost of Chinese radial tyres low (almost 25 to 30% cheaper than native products) and on par with Indian cross-ply variants. Regional Trade Agreements (RTA) of India along with the inverted duty structure has made the situation easy for Chinese players. Under the Asia Pacific Trade Agreement the custom duty for countries like China is 8.6% which is 2.4% lower than the normal rate. Another issue that has resulted in the competitive price is the fraudulent invoicing policies undertaken by black marketers and independent sellers of Chinese radial tyres. These tyres are sold without VAT on a direct cash transaction policy that keeps the price low. The attractive pricing structure has outweighed possible quality issues associated with them. This dumping of Chinese imports in India has led to heavy losses for the exchequer of the country amounting to a monthly loss of around 60 to 80 crore (11, 600, 000 USD), according to Automotive Tyre Manufacturers Associations (ATMA) Director General Mr. Rajiv Budhraja. Within the context of a pricing war in the truck and bus radial tyre segment in India, what does not help India is if the industry does not extract the maximum benefits from radialisation due
To counter the seemingly unfair competition and to provide Indian manufacturers with the same platform, a very important step was taken in the form of an anti-dumping duty.
Radialisation Trend By Segments

100 90 80 70 60 LCV 50 40 30 20 10 0 FY09 FY10 FY11 FY12 Source: ICRA, Annual reports Passenger Car T&B
to poor quality products. Benefits such as significant fuel savings, longer-lasting and longer-running products, and significant raw material savings from retreading would never be fully extracted. Protection of the domestic market: Anti-Dumping Duty This Chinese radial penetration has definitely raised concerns for Indian tyre companies. To counter the seemingly unfair competition and to provide Indian manufacturers with the same platform, a very important step was taken in the form of an anti-dumping duty (ADD). India is not the only country to have done so as the USA also adopted the same policy on Chinese radials. In November 2008, TBRs came under the restricted list and finally in February-
Chinese radial tyres -2010 definitive ADD was imposed by the government on TBRs (included both tyre and tubes) from China as well as Thailand. As part of the ADD, a price bracket of US$24 -US$90 per tyre has been imposed on Chinese products; despite this though, tyres remained cheaper and continued to make their presence felt in India. This move however has not been welcome by the automobile industry as the import restrictions are bound to affect the sector negatively as pointed out by the Society of Indian Automobile Manufacturers. In the face of the domestic lines incapability to cope with the rising demand, naturally vehicle manufacturers have no choice but to rely on Chinese radial imports as is the case with auto giant Tata Motors. The restrictions therefore will thwart the growth of the auto sector. Halfway through 2011, however, this import restriction was lifted by the Excise and Service Tax Appellate Tribunal post the filing of a plea by Bridgestone India, Tata Motors and Chinese companies. This has yet again raised concerns among Indian manufacturers who are back at the level of direct competition with Chinese companies. The expansion ventures of Indian manufacturers to counter the Chinese radials The suppuration of demand for radial tyres especially in the T&B sector has prompted the Indian tyre industry to undertake major investment ventures for brown and green field operations. Plans for investment worth around 6, 000 crore were undertaken by the Indian tyre industry as early as 2009-10 and between 2010 and 2013 the industry will attract an investment worth 17, 500 crore (3, 500, 000, 000 USD). Out of which the truck and bus radial market is expected to wrap up around 50% of the investment share followed by that of the passenger car sector. Most Indian companies have taken the radial push. One of the major players JK Tyre has investment plans worth 1, 500 crore (300, 000, 000 USD) for TBR and PCR that are expected to be completed by March 2013 whereas MRF Ltd is all set to pump 1, 372 crore (274, 400, 000 USD) for PCR projects. Similarly Kesoram Industry (Birla) has made a 1, 000 crore investment for TBR and PCR. New plants have been set up by JK Tyre in Mysore whereas Apollo Tyres has started new radial operations from Baroda. The latter has invested to the tunes of around 1, 100 crore (220, 000, 000 USD) for the same. In fact, top international brands have set up radial operations in India directly. The largest and most ambitious project is the Michelin one with more than 4, 000 crore (0.8 billion USD) for its TBR Chennai plant. Bridgestone is following in their footsteps.
Plans for investment worth around 6, 000 crore were undertaken by the Indian tyre industry as early as 2009-10 and between 2010 and 2013 the industry will attract an investment worth 17, 500 crore.
Special Issue April, 2012 The Future Direction
Chinese radial tyres
It would be in Indias interest to extract the most from radial technology and to accelerate towards creating the right platform that supports sustainable transportation.
The significant local investment in radial technology today will help bring India over the next years closer towards the Asian average in radialisation. Radial offers from Indian tyre companies may start to dilute the Chinese effect. However, the challenge remains that with the ADD waived, Chinese tyres will continue to make their way in the Indian market at a lower price than native units. However, as this still youthful part of the tyre industry evolves and matures in India, radial tyres should start to be considered not just on price but on the total value (or savings) it brings to users. The trend should therefore start to move from a pricedriven model to a value-driven model. Clearly, it would be in Indias interest to extract the most from radial technology and to accelerate towards creating the right platform that supports sustainable transportation. Words: India Transport Portal Back to table of contents
Radialisation Trend
100 90 80 70 60 50 40 30 20 10 0
T&B Tyres (in %) Source : ICRA, Annual reports
Different types of radial tyres
Different types of radial tyres

The importance of radial tyres is crucial as there are various types of radial tyres produced by different manufacturers. But as the cheapest varieties heavily compromise on quality, it could ruin the efforts for the improvement of situation in the form of major investments by both top rated Indian as well as foreign brands.
The radial sector is one of the most forthcoming domains in the tyre industry of India and in recent times has attracted lots of attention. Radialisation trends have not penetrated the country in the same way as they have done on a global level. Infrastructural shortcomings such as bad road conditions, overloading issues intertwined with low awareness level have thwarted the growth pace of radial tyres in India especially in the truck and bus (T&B) segment. Of late, however the trends have seen a reversal. Like the passenger car sector (99% radialisation rate) the truck and bus radial market is also making waves and has a registered a 9-10% growth it is expected to reach around 25% within the next three FYs.
Radial tyres are of cardinal importance in the transport sector especially for T&B.
Radial tyres entail great returns in the long run There is no denying the fact that radial tyres are of cardinal importance in the transport sector especially for T&B. In fact, the long term benefits that these tyres generate have gone a long way in displacing the earlier conservative notions attached to them. Compared to the much in demand crossply bias variant, tyres with radial technology offer better mileage and most importantly are much more fuel efficient (saving at least 5% and 3% more fuel for old and new vehicles respectively). The robust build of the tyres ensure almost 80% longer life but due to high performance capacities the initial investment for these tyres is higher than the bias types, although in the long term they are much more cost-effective. The table 1 clearly testifies that. Quality is key to the choice of radial tyres In India, although the radial push for all sectors has come pretty late compared to a world-wide level, in recent times the Indian tyre industry is flooded with various types of radial tyres and manufacturing companies. Buyers can choose from both, Indian and foreign brands. But with the inroads of Chinese manufacturers an alarming trend has come to light. Taking advantage of the recession, the growth of radialisation in India has been marked by Chinese brands overtaking sales thanks to their attractive pricings which have heavily contributed9
Table 1: Average Indian Radial vs. Cross Ply T&B tyres

Metric Price (Rs) Life of new tyre (Km) Cost per retreading (Rs) Total cost of retreading (Rs) Increase in life after retreading (Km) Total life of tyres Retreading Possible (Times) Mileage (Km/l) Diesel Cost (Rs/l) Fuel Cost/Km (Rs/Km) Effective Cost/Km (Rs/Km) Source: ICRA Rating Feature, April 2011 Bias 13 ,000 55, 000 3, 800 7, 600 82, 500 137, 500 2 4.5 37.8 8.4 8.5 Radial 17, 500 100 ,000 4, 200 12, 600 225, 000 325 ,000 3 4.7 37.8 8 8.1
Different types of radial tyres -to their success. Post the removal of anti-dumping duty in 2011 the problem has become worst. The Chinese radials that are dumped in the native market are however, not considered of good quality. Varieties that are of lower quality rule out the very efficacy of radial tyres in the first place. It is true that tyres with radial technology require initial huge and capitalintensive investments and are priced higher than the normal varieties (20% more in terms of selling price) but the benefits that they incur outweigh the price issue. Good radial tyres make the vehicles more fuel-efficient and are crucial in containing carbon emissions that trigger environmental hazards. Their longer lifespan and maneuverability ensure safer driving conditions. The hallmark of a quality radial tyre is better handling capacities that will ensure minimal tread wear. Such attributes require innovation that naturally pushes the price of the products. Top rated tyre companies create innovative designs to make such high quality tyres. In October last year, MRF for example launched tubeless radial tyre MRF Z.L.O that is tailor made to offer high speed driving capabilities. This tyre is equipped with advanced polymer alongside stable ring construction and can be used in domestic as well as imported cars. French manufacturer Michelin that supplies tubeless radial
Michelin has come up with special tyres in the TBR sector that are designed with technologies especially suited to Indian roads.
tyres for passenger cars has come up with special tyres in the TBR sector like XDE2 XDY3, XZE2 & XZY3 that are designed with technologies especially suited to Indian roads. Along the same line, Goodyear launched the GT3 radial tyre that is equipped with Bubble Blade TM tread block design taking safety to a different level. For consumers choosing cheaper varieties of tyres it means having to trade down on quality. The only good news is that with the rising demand in the CV segment Indian tyre makers have finally woken up and are now taking great initiatives to stem the penetration of inferior products. Government measures like improved road conditions and restrictions on vehicle overloading have also eased the situation. The growth map of various manufacturers: Indian and foreign The Indian tyre industry has come a long way from the time JK Tyre first launched radial tyres in the country in the 1990s. In the year 2010-11 the capacity of the tyre industry increased by 8% and in the years 2011-13 the industry is poised for a robust 25% capacity enhancement plans. The major thrust of the investment plans is focused on developing tyres with radial technology and a significant level of finance has been pumped into the green field operations dedicated to the TBR sector. Almost all the top tyre companies of India be it Apollo Tyres Ltd, Bridgestone India or JK Tyre and Industries Limited are rolling out massive plans for increasing radial capacities. Ceats 700 crore investment in the green field Hallo plant is10
Different types of radial tyres -also dedicated towards the radial operations only. The table above (Table 2) details projects and the level of investment various manufacturers have undertaken. Foreign tyre companies are also not far behind and they are eager to get their share of the Indian market. French manufacturer Michelin has pumped in investment to the tune of 4,000 crore (0.8 billion USD) in a Chennai plant that will start to be operational by the end of 2012. This plant is targeted to produce 300,000 radial tyres in its first year which will be tapping into the replacement market mostly. The radial tyre industry is enjoying continuous growth at the moment despite the worldwide recession. Unfortunately cheaper products and smaller disposable incomes have meant that many customers are now choosing the cheaper options of tyres. However, the benefits of radial tyres are undeniable and providing customers can overlook their initial higher costs, this sector is set to continue growing on both a domestic and international front offering more and more choices to buyers. Words: India Transport Portal Back to table of contents
French manufacturer Michelin has pumped in investment to the tune of 4,000 crore in a Chennai plant to produce 300,000 radial tyres in its first year.
Table 2: Major projects by the Indian tyre companies that are in pipeline
Company Location Oragadam, Tamil Nadu Apollo Tyres Limited Chennai, Tamil Nadu Vadodara, Gujarat Bhuj, Gujarat Balakrishna Industries P Ltd. Rajasthan & Maharashtra Chakan, Pune Bridgestone Limited Pithampur India P Product PCR tyres (2 phases) TBR tyres Tyres Speciality tyres Pneumatic tyre, tube & flap Tyres TBR PCR TBR Radial tyres Ceat Limited Dunlop India Limited Falcon Tyres Limited JK Tyre & Industries Ambarnath, Maharashtra Guwahati, Assam Haridwar, Uttarakhand Mysore, Karnataka Sriperumbudur, Tamil Nadu Speciality Tyres Truck tyres Tyres Tyres PCR Tyres (2 phases) TBR tyres Source: ICRA Rating Feature, April 2011 11 India Transport Portal & Earthmovers 200 nos / day 6, 000 nos / day 200 tonnes / day 50 tonnes / day 60 lakh units 200, 000 nos / day 2, 500, 000 nos / day 400, 000 nos / day 110, 000 tonnes / annum 150, 000 tonnes / annum 200 2, 600 260 90 260 340 450 570 315 1, 500 Capacity 9, 000 nos / day 4, 700 nos / day 200 1, 200 Investment (Rs. crore) 2, 100
Limited
Fuel savings
Radial tyres and fuel savings

How much a tyre is responsible for fuel consumption? What is the use of radial tyre for fuel savings? What are the factors that make the radial tyres work towards fuel economy?
With the shift towards radialisation the global tyre industry has benefited from a large number of structural changes. One of the most enduring results of this radial trend comes from the fact that these tyres are highly fuel efficient. Ecological hazards largely stem from carbon gas emissions and tyres that promote fuel economy can contain this situation. Radial tyres, although more expensive, garner returns that outpace the price factor. The fuel saving technology of these tyres is very much in tune with the green initiatives that are being undertaken all over the world to help preserve the environment.
The fuel saving technology of these tyres is very much in tune with the green initiatives that are being undertaken to help preserve the environment.
How does a tyre make the engine consume more fuel? A number of operational forces act on any moving vehicle. In order to continue the mobility, these forces need to be countered. The engine of the vehicle thus produces a force opposite and greater in magnitude to continue the operation. To produce the energy of this force, the engine uses fuel. Naturally, the higher the percentage of the operational forces on the vehicle, the higher the level of fuel consumption will be.
Table 1 Distribution of energy consumption

100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Source: Michelin Gravity Inertia forces Mechanical friction Rolling resistance Aerodynamics
Now, one of the forces that act on the moving vehicle is the Tyre Rolling Resistance. This force created by the tyres accounts for around one-third of the total force that the engine eventually needs to compensate. When the tyre rolls on the ground this resistance force is created. The rubber element of the tyre naturally absorbs energy and that is dispersed once the tyre flexes followed by a rolling. The Table 1 clearly shows that across different terrains rolling resistance is one of the most important forces that the engine needs to counter.
Special Issue April, 2012 Factors that can induce fuel savings
Fuel savings
According to an estimate by Goodyear, Smooth-textured highway surfaces provide the lowest rolling resistance.
The impact of this rolling effect is lessened with tyres that have radial technology. In these tyres, plies of cord are placed across the tire and each ply cord lies at 90 degrees or perpendicularly to the direction of travel. This significantly reduces the rolling friction as the plies do not crisscross over each other. According to reports based on a test conducted by Bridgestone Ltd., the shift from a cross-ply tyre to a radial tyre brings about a significant decrease in fuel consumption of about 10 per cent and also a corresponding decrease in rolling resistance between 30 and 40 per cent. It is important to remember though that tyre rolling resistance is an important factor, but not the only one in the fuel consumption equation. Thus a percentage change in rolling resistance does not necessarily bring about the same percentage change in fuel saving although if the vehicle is more aerodynamic in design, then the rolling resistance will definitely create a substantial difference to the amount of fuel consumed. Within the radial tyre itself the degree to which it contributes towards fuel economy varies. Different parts of a radial tyre contribute towards the creation of rolling resistance force. Thus the way a tyre is constructed by the manufacturers holds the key point. The frictional force that is created between the tyre and the road surface is influenced by the type of tread used in the making of the tyre. Tread pattern and tread design constitute one of the important factors that has a direct bearing in generating this force apart from the surface of the road. According to an estimate by Goodyear, Smooth-textured highway surfaces provide the lowest rolling resistance, while coarse-textured surfaces give the highest tire rolling resistance and the lowest fuel economy The latter factor is not always easy to change but the former
Graph 2: Contribution of tire components to rolling resistance

35 50%
50 65%
can be taken care of to tackle the problem of fuel consumption. Tread or the outer envelope of the tyre is definitely one of the most vital parts contributing to tyre rolling resistance force because it is this part of the tyre that is in direct contact with the road. A percentage of around 35-50 % can be attributed to the compound that is used in the making
Source: Bridgestone
of the tread as being responsible for generating this force (Graph 2).
Fuel savings Compounds like silica or various types of rubber - both natural and synthetic engineering variety can help in reducing frictional Cap Base resistance and hence result in lower fuel consumption. Sometimes top manufacturers design the tyres tread with a dual layer. In this kind of cap base tread the outer cap compound that is used offers better traction and longevity so that the best performance can be achieved but at the same time this attribute generates more heat (Graph 3). Thus an intermediate layer is created between the outer cap and carcass which is lined with a cooler compound. This type of engineering keeps the temperature of the tyre at an opt Source: Bridgestone imum level and thus adds to fuel efficiency. Tread design also contributes to energy saving. Generally treads with rib design are considered to be better in this respect than those with lug or block designs. The depth of the tread is also important and according to a report by Bridgestone, tyres with shallow treads are more helpful in preventing carbon emissions than the other category. Fuel saving tyres from leading manufacturers Leading tyre companies come up with tyres with these features and add on further innovations to make the radials more optimized for fuel savings. French manufacturer Michelins tyres are dedicated to this in a large way. According to a ground test conducted by the company, its truck and bus tyres with radial technology are capable of saving around 8.62 and 4.16 per cent. This fuel consumption test conducted in Malaysia was carried on two identical buses and trucks but fitted with different types of tyres. Compared to the bias tyre types, the Michelin tyres that were tested -10.00 R20 (for trucks) and energy radial tyres (for buses) proved to be more efficient in terms of fuel. Similar tests were conducted in various other countries including India and yielded similar results with the fuel efficiency ranging from 6.5 to 11 per cent. In fact, Michelin has always lived up to its commitment of freeing its customers from the ordeals of high fuel prices. The products of this company prove that. The company was the pioneer in the usage of silica in rubber. In its Energy Tyres this compound was used for the first time and its less heat consumption that intertwined with its slight nature resulted in less consumption of fuel. In addition, tyres of this maker are generally labeled with MICHELIN Green X. This marking on the side walls of the tyre ensures high energy efficiency along with an optimum performance level.
Graph 3 : Cap & Base construction
According to a ground test conducted by Michelin, its truck and bus tyres with radial technology are capable of saving around 8.62 and 4.16 per cent.
Fuel savings Other leading companies also design their products along the same line. Bridgestone recently launched in India its ecofriendly range of tyres under the name of ECOPIA EP100A. This specialized range is engineered especially to offer low resistance force that consequently will cater the needs of fuel efficiency programs as well as fulfill the mission of delimiting emission hazards. Another leader in the industry, Goodyear, also aligned its products for the same cause. The 3 Zone technology that the brand uses in designing its tyres keeps the resistance force to a minimum level resulting in fuel economy in a large way. The products imbued with this technology have a special composition of silica along with an advanced polymer. Radial tyres have definitely beckoned major technological benefits for the tyre industry as a whole. Good quality radials are suitable for keeping the environment safe and at the same time give high end performances. The internal build makes
Goodyear also aligned its products for the same cause. The 3 Zone technology that the brand uses in designing its tyres keeps the resistance force to a minimum level resulting in fuel economy.
radial tyres more beneficial than the bias types and even newly retreaded tyres offer higher fuel savings than the normal cross-ply variants. Thus a shift towards this trend is considered to be wise and expected to continue growing in popularity. Words: India Transport Portal Back to table of contents
Retreading
The other lives of a radial tyre

What is tyre retreading and how beneficial is it? What are the key factors in the retreading process? What is the market in India?
With the rise of radialisation, the Indian transport sector has come of age and is steadily getting on par with the global standards. The benefits of radial trends, however, come with a heavy price tag. Considering the long term returns, the initial large investment can be overlooked but there is no doubt that the use of good quality radial tyres has increased the running cost of vehicles especially in the commercial vehicle segment (CV). The good news is that these tyres, coming from the stable of leading manufacturers, can have additional lives as well. This can be done through the tyre retreading process. What is tyre retreading and what benefits does it incur?
Thanks to this technological advancement tyres can now achieve a mileage as high as 1, 609, 000 km.
Tyre retreading is essentially the process by virtue of which the worn out tread of the tyre is replaced with a new tread. This part of the tyre forms its outer layer and is in constant contact with the road. Quite naturally this part is more susceptible to wear and tear processes. In addition, tread is one of the vital components that determine the tyres rolling resistance and is key to the performance of the tyre. Thus refurbishment with a new tread gives the tyre a new lease of life and thanks to this technological advancement tyres can now achieve a mileage as high as 1, 609, 000 km. The two processes that are commonly used for retreading are as described in figure1. Tyre retreading is highly advantageous in terms of operational
Figure 1: Retreading processes
costs. In the entire scope of the manufacturing costs of a tyre, tread represents only about 20-25%. Naturally, replenishing a tread can be done at a much lower price than the original
Conventional Process
Precure Process
cost of a new tyre. According to industry estimates, the process can be attained at less than half the price of a new tyre. This means that a significant amount savings can be made in the course of the life of a tyre. Thus from the customers point of view this other life of the radial tyre is a highly effective especially because radial tyres incur huge cost at the first place. The best part is that even after retreading performance is never an issue. According to the laboratory test by Goodyear, tyre rolling resistance (key point to an engines performance) is almost same in case of radial tyres with original tread and those with16
Done through the process of vulcanisation wherein the strips of rubber of unvulcanised nature are moulded on to the tyres buffed casing. This process is also known as mould cure or hot cure.
Done also through the process of vulcanisation but here the pattern of the rubber strip is pressed and pre-cured from before. The strips are applied to the casing which merges seamlessly with the latter through a layer of cushion or bonding gum that is made from a specially prepared uncured rubber. This process is also known as cold cure.
Retreading -retread. Interestingly both the types have exhibited less resistance force than a new cross-ply tyre. Retreading of tyres is not only beneficial from the point of view of cost but also is advantageous from the environmental point of view. Such tyre recycling procedures saves the ecology from massive wastes of worn out tyres and use of remanufactured tyres saves oil resources in a large way as well. Prerequisites of tyre treading: good casing For tyre retreading it is vital that the body of the tyre or the carcass on which the process has to be accomplished is in a desirable condition. If the casing of the tyre is in a bad shape then the whole retreading process will become useless and the tyre will be unable to deliver an optimized performance. The quality of the casing is therefore the basis of a good retreadable tyre. With radial tyres produced by top manufactures such quality concerns are never an issue. Michelin tyres for example, are equipped with specially engineered casings that offer the robustness required for seamless and secured retreading and can infuse the tyre with multi-life. Even after retreading Michelin tyres can enjoy the same benefits of fuel economy and the makers Durable Technologies as with a new tyre. Tyres manufactured by Michelin are equipped with features like protection plies in the bead area, inner liner that is air tight, elastic cable in protection ply, casing ply with humidity proof cable etc. All of these attributes are the hallmarks of a durable casing that gives enhanced endurance, longevity and at same time provides a safe drive. This kind of casing enables retreading of the tyre even more than once which is often required in the case of trucks and buses. Thus in the case of such quality casings even after the end of their first life, tyres can get another life. Retreading market in India The Indian market for tyre retreading has belatedly woken up just like its radial trends across all transport segments. Naturally, the retreading sector is still at a nascent stage and at times is disorganized. Companies functioning through proper franchisees or to be precise organized companies dealing with retreading businesses are very few in this country. MRF, Apollo, ELGI, Midas, Sundaram Industries, Annamalai Tyre retreading Corporation, Indag and Staines Tyres are some of the wellknown companies that are associated with this industry in India. Many of them have technological partnerships with foreign companies that enable the remanufacturing of worn out tyres according to global standards. A large part of the Source: Purcelltire.com business, however, is in the hands of unorganized players. 17
After retreading, Michelin tyres can enjoy the same benefits of fuel economy as with a new tyre.
Special Issue April, 2012 This is a definite sign of worry
Retreading because under such
With the move towards radialisation, the market for retreading in India has faced a new challenge in terms of technology.
circumstances inferior retreading processes may be adopted. This will create less reliable tyres in terms of durability, handling and can even compromise on passenger safety. There are other problems as well for the Indian market. The procured treading process, which is more effective than the conventional process, is practiced on a global level, whereas in India the latters share is as high as the former. The conventional retreading method can create distortion in the tyre and can put undue stress on various parts of the vehicle like engine, suspension etc. which will impact on the driving convenience in the long run. The future direction: prospects and problems This process of tyre recycling that enables the optimum usage of the product is all set for a positive growth in the CV segment of India (retreading largely loses out in the passenger car segment due to aesthetics concerns) because of the practical financial advantages attached to it. Structural changes like increased thrust towards radial trends, new National Highway projects and the emergence of multi-axle trucks has made the retreading of tyres the most economic and wise option in the T&B sector. There are, however, challenges to meet as well. The input cost of tyre retreading has increased sharply over the years. Both tread and sheet rubber have faced price hikes. Secondly, with the move towards radialisation, the market for retreading in India has faced a new challenge in terms of technology. Now with the upgraded technological inputs for radial tyres, different from those for bias types, were required in the retreading process. This involves huge investment, which many small players in the business cannot afford and are forced to close down. This could lead to a new phase in this market as big and renowned players than ones. defining will the get the chance to operate more disorganized is for the the Quality point
Tyre Retreading at Sun Tyre
growth of this industry and unless that is ensured, the use of remanufactured tyres makes no sense. Words: Portal Back to table of contents Source: SunTyre.suntex.com India Transport
Radial technology
Radialisation is becoming an important issue especially regarding trucks. Indian and foreign players are investing massively to answer the growing demand. But what are the characteristics of a TBR?
The progress of radial technology for trucks
Ever since the launch of radial tyres by Michelin in 1946, this breakthrough technology in tyre manufacturing has become the standard practice across the globe. Although India made a late entry in this domain, its commercial vehicle segment is currently a hot bed for radialisation. In fact, according to a report by DNA, the growth rate of truck and bus radials (TBR) will go up two-fold within the next two years from the existing radialisation level of around 15% and radial trends in this sector will be at the forefront of the revenues for tyre manufacturers in India who have suffered from low margins recently. The development of radial technology for trucks Indias first try with radial technology happened in the hands of JK Tyre in 1977 but that was for passenger radials. It was only in 1999 that the first all steel radials for trucks got introduced in India and JK Tyre also gave the country the first radial plant for manufacturing truck radials. Within the last decade the truck radials scene has undergone a vast change. All the major players in the tyre manufacturing industry - both domestic and international like Ceat, Apollo, MRF as well as Michelin and Bridgestone are seen to be vying for the Indian market and they have also ramped up their production facilities for truck radials. Ceat has made a 700 crore rupees (137, 900, 000 USD) investment in its Halol plant, Michelin will pump in 4, 000 crore rupees (0.8 billion USD) in its Tamil Nadu plant, and the 2, 300 crore rupees (453, 100, 000 USD) invested in Apollo Chennai plant is 70% dedicated to the production of radials for trucks along with bus radials. Nikolai Setzer, the tyre division head of the German brand Continental, which is set to produce radials in India from 2013, has remarked that radialisation will be the driving force in the Indian truck tyre market and accordingly the company has made an investment to the tune of 50 million Euros (Rs 336 crore) for producing truck radials alone in the country.
Michelin launched the first radial tyre in 1946. Indias first try with radial technology happened in the hands of JK Tyre in 1977.
Radial technology The numerous investment plans by tyre majors are a clear indicator that radial trends are set to continue growing in India. The increase in capacity is one of the most significant developments for truck radials in India and this has happened due to a number of structural changes in the country besides the heavy demand in the commercial vehicle segment arising out of the burgeoning economic needs. The progress of radial technology for trucks is directly related to the improved conditions of the roads in India and the upcoming Express Highways as well as National Highways in the country which mean that trucks fitted with radial tyres are becoming more efficient and cost effective. Ever since the Supreme Courts ban on the overloading of trucks in 2005, new generations of vehicles with multi-axles and needing radial tyres have been created to keep their performances at an optimum level. The promotion of radial tyres by automobile manufacturers like Tata Motors as well as Ashok Leyland through their new age trucks like Prima and U-Truck has helped truck radials consolidate their position in India and made them a more acceptable choice for end-users. Awareness campaigns by the Original Equipment
The Michelin Caravan, an event-on wheel concept was an innovative effort aimed at popularizing the companys radials for trucks that have been manufactured with the conditions of Indian roads in mind.
Manufacturers or OEMS have also largely helped the progress of radial technology for trucks. The Michelin Caravan, an event-on wheel concept was an innovative effort aimed at popularizing the companys radials for trucks that have been manufactured with the conditions of Indian roads in mind. The improvements in performance The awareness of these advantages was critical for the penetration of radial technology for trucks in India because the initial investment for truck radials was capital intensive compared to the traditional bias variant; despite this the popularity of radial technology has overtaken that of bias types. Radial tyres come with obvious benefits in terms of fuel savings, mileage and longevity. New trucks fitted with radial tyres have a fuel efficiency of about 5% higher than the ordinary cross-ply variant. Thus the usage of radial tyres has a positive impact on the environment as greenhouse gas emissions are lower. In terms of shell life, these tyres last twice as long as cross-ply tyres. In addition, one can retread radial tyres three times, unlike tyres with older technology that can be retreaded only twice. The aspect ratio is also better with these tyres. The aspect ratio of a tyre is the height of the tyre sidewall expressed as a percentage of the tyres width. It gives tyres with radial technology the advantages of better handling20
Radial technology
Bias Truck Tyre
-and manoeuvrability. According to an estimate by the Economic Times from 2010, the overall saving of using a vehicle fitted with radials is approximately 25 thousand rupees (492.5 USD) more than that of the cross-ply tyre. The architecture and components of a truck radial The performance benefits of a radial tyre stem essentially from its unique architectural build and the engineering of its casing. The most important part of the casing that lies beneath the tread or the outer envelope of the tyre comprises the plies of cord. Unlike conventional bias tyres where the ply cord runs across the tyre in a criss-cross fashion, plies in tyres with radial technology run perpendicular to the direction of travel of the tyre. This orientation of ply cords usually built with polyester or steel in the case of truck radials creates lower resistance and saves the engine from consuming more fuel. This structure also helps keep the temperature of the tyre cooler compared to its old counterpart which adds to the durability of radial tyres in general. Ply cord is only one of the components that make up the radial tyre. Over the plies of cord come the protective belts,
Source: jktyre.com
With India relying so much on road transportation, the development and improvement of radial tyres of trucks has been instrumental, and this radial trend is set to continue.
usually made of steel, although other materials are also in vogue like aramid synthetic fibre. These belts provide protection to the carcass from any external shocks and wear and tear. In the case of truck radials, over the ply cords there can be more than one layer of protective belts so that the tyre can bear the heavy weight of the vehicle. There are also other important parts in the body of the tyre like bead that holds the tyre to its wheel rim. This part comes coated with rubber and is made of solid steel wires. Side Walls, that are intertwined between the beads are layered with compounds of rubber, adds to the lateral stability of the tyre and is another important
Radial Truck Tyre
aspect of its casing. This part of the radial tyre is more flexible than the bias tyre, and this along with the powerful steel belts, provides the tread of the tyre better grip and does not allow the tread to squirm which adds to the increased mileage factor for radials in trucks. Extra layers of protective fabrics made of polyester may also form the body of the radial tyre. This part is known as cap plies but this is mainly a feature for high speeding vehicles. The internal build and orientation of the radial tyre sets it apart from the conventional bias tyres and holds the key for its robust performance. With India relying so much on road transportation, the development and improvement of radial tyres of trucks has been instrumental, and this radial trend is set to continue. Words: India Transport Portal Back to table of contents
Source: jktyre.com
JK Tyre
The only way to compete is to provide quality tyres

Dr. R. Mukhopadhyay speaks about the need for the Indian Tyre Industry to focus on innovation and green technologies in order to take advantages of radialisation and to compete against Chinese players.
India Transport Portal: During the Green Freight India Seminar, you made a presentation that focused on green technology for tyre industry. How would you balance the immediate need for transportation that India is facing and environmental issue which rhymes with investment and technology adoption? Dr. R. Mukhopadhyay: Global automobile is in transition and facing two major challenges to ensure sustainable growth in future reduction of Green House Gas Emissions (GHGs) and reduction of oil dependency. To reduce GHGs emissions, Govt. agencies in respective countries imposed strict legislations and regulations related to automobile and tyre industry. Under such global environment regulations and legislations India should work towards restraining demand of automobile through providing good mobility and accessibility by: Increasing public transport, Charging full cost vehicle use (pollution, energy, security, greenhouse gas emissions) via fuel, vehicle and usage taxes. They should also adopt a strategy to restrain vehicle use which provides: Urban land use management, Pricing of vehicles use and ownership, Improving public transportation, Innovative mobility technology, o o o o Bus rapid Transport, Small, neighborhood cars, Safe bicycle lanes, Car sharing.
Besides above, Govt. of India should encourage continual
Govt. of India should encourage continual investment in Research and Technology development for eco-friendly technology.
investment in Research and Technology development for ecofriendly technology in automobile and tyre industry with special emphasis on Development of much cleaner, more efficient and safer vehicles and other auto components including tyre.
22
JK Tyre India Transport Portal: You claim for green technologies in the Indian tyre industry. What an ecofriendly tyre should like? Dr. R. Mukhopadhyay: Environmental sustainability of tyre begins with design (lower weight, radial construction, low aspect ratio), selection of raw material (preferably ecofriendly & non petro based material, recycled material, natural materials like silica in place of carbon black), energy efficient manufacturing process (use of non-conventional energy), elimination of waste/scrap during manufacturing process, minimized testing and field evaluation, use of simulation and predictive techniques for design, testing and evaluation and avoid unnecessary field tests. The sum of above provide ecofriendly green tyre. India Transport Portal: The passenger car segment is well radialised but there is still a lot to do for the truck & buses segment. How the transportation sector could gain from radialisation (performances on fuel savings, carbon emission, road safety etc.)? Dr. R. Mukhopadhyay: The transportation sector has much to gain through radial tyres over conventional tyres. We can list several benefits to radial tyres that lead to greater road safety and less carbon emissions while providing better performances: Longer Tread Life Almost up to 100% more wear life. Since the tread is free from lateral deflection, the tread wear is less, Lower Rolling Resistance Due to lack of lateral deflection of tread elements, the rolling resistance of Radial Tyre is less. The energy for traction is almost completely utilized (10% improvement in rolling resistance will provide average. 2% fuel saving), Higher cornering power and smaller slip angle, Better tractive and braking grip due to greater area of contact patch, the ground pressure is slightly lower and more evenly distributed. That leads to greater safety, Better high speed performance, Better riding comfort this is because of greater flexibility and suppleness of the sidewall which can easily accommodate the dumping vibration, More resistance to bruise impact or impact, Environmental friendly fewer raw materials are required to produce a tyre reducing consumption of natural resources. of used tyres Lower fuel consumption brings down greenhouse gas emissions. Better tyre life leads to less no.
The transportation sector has much to gain through radial tyres over conventional tyres.
HASETRI is an Indias research Centre which fulfills need for developing newer and better technologies for tyres and polymers. This Institute was established in October 1991 as an independent Research and Testing Laboratory, to cater to the need of rubber and allied industries at National and International level.
JK Tyre India Transport Portal: Chinese competitors are entering the Indian market. It is often said that they have a low cost offer. What does it mean especially regarding materials that are used in tyres (rubber, carbon black, additives and other material) and in the way they are produced? Do you think that such competitors can provide an answer to such concerns (fuel savings, road safety etc.)? Dr. R. Mukhopadhyay: Chinese manufacturers can offer products at lower cost compared to manufacturers in other countries for several reasons. They receive support from Chinese Government that is driven by greater environmental pressure and energy consumption. The Chinese government has also started stronger incentives to promote cleaner technologies in automobile industry. There is also a Mass Product Environment because China possesses ample resources to achieve low cost production. However, Chinese cost of manufacturing is continuously increasing and will be comparable with other countries as soon as Chinese Government withdraws their support. Regarding quality, China produces various qualities of tyres prime tyre and economic tyre. Prime tyre quality & cost is competitive with other countries. Economic tyres are lagging on that. Besides quality and cost, product like tyre require after sales service, which is lacking by Chinese manufacturers in India compared to their counterpart in India. India Transport Portal: How Indian manufacturers such as JK Tyre plan to compete in such environment, between western manufacturers and low cost players? Dr. R. Mukhopadhyay: The only way to compete in such environment is to provide quality tyres at competitive price through technology development and manufacturing excellence. India Transport Portal: You made an important observation with the tyre disposal. How do you consider the retreading issue? Could it be a solution to ensure a better life cycle for radial tyres?
Besides quality and cost, product like tyre require after sales service.
Dr. R. Mukhopadhyay, M.Sc. & Ph.D. from Indian Institute of Technology is presently Director (R&D) of JK Tyre & Industries Ltd, Director & CE of HASETRI and Chairman of the Indian Rubber Institute. He wrote more than 150 research and technical papers. He filed six Patents. He is a specialist in green technologies.
Dr. R. Mukhopadhyay: Radial tyre has got better life cycle compared to conventional tyres with respect to quality, cost per km and safety. As radialisation increases in the commercial vehicle segment, the cold process retreading will increase proportionally. By enhancing retreading capacity in Truck/Bus Radial segment, the tyre disposal can be minimized. Back to table of contents
ATMA
The Daimler choice speaks volumes about the quality of Indian tyres
Mr. Rajiv Budhraja explains how the Indian Tyre industry is facing the Chinese competition and how it is able to compete successfully by focusing on quality and an efficient, service support.
India Transport Portal: Chinese radials came to occupy around 60% shares of the Indian TBR market. How do you explain such success? Mr. Rajiv Budhraja: While 60% could seem to be a substantial percentage, it needs to be understood in the context that TBRs so far accounted for just about 10% of the total truck & bus tyre segment. Bias tyres have accounted for the major share of the T&B tyres both in OE and replacement market. So success of Chinese radials, if it can be so called, needs to be seen in that limited context only. Meanwhile the demand for TBRs is growing in view of introduction of new generation of vehicles, better road infrastructure and an awareness drive on superiority of radial tyres launched by Indian tyre industry. The industry has lined up Rs 13, 000 crore of investments a large part of which is for TBRs. The investments have been planned so as to be ahead of the demand curve as the demand for TBRs is poised to rise exponentially as happened in the case of car radials over the last two decades. At another level, yes, the rising import of Chinese tyres of all kinds is a continuing concern with Indian tyre industry. While Indian industry is not against the legally imported tyres, a large percentage of tyres from China are being dumped in India through unfair means such as under-invoicing & under valuation and thats a big concern. Anti-dumping duties imposed on the Chinese tyres have, however, been helpful in curbing such imports.
Success of Chinese radials needs to be seen in its limited context only.
ATMA Chinese manufacturers also enjoy a cost arbitrage over Indian manufacturers for a variety of reasons. The export incentivisation policy of China has also played its part in helping Chinese tyres garner market in countries such as India. These facts also merit consideration while discussing the import of tyres from China to India. India Transport Portal: China already has a high overall radialisation rate compared to India. Does it mean that China gained a strong experience regarding the TBR manufacturing? Mr. Rajiv Budhraja: The process of radialisation in T&B tyres in China preceded that of India. To that extent, yes, Chinese companies have a longer experience. However Indian manufacturers are well placed to launch TBRs that compete with the best in the world. The Indian manufacturers have already shown their prowess in case of car radials, where again the radial revolution caught up late in India. India Transport Portal: It is often said that Chinese players have several cost advantages. What are the advantages of the Indian tyre industry that could help to compete against such manufacturers? Mr. Rajiv Budhraja: Indian companies certainly dont enjoy a level playing field in comparison to their Chinese counterparts when it comes to cost advantage. Tyre manufacturing is a raw material intensive industry. China went ahead and made available the import of Natural Rubber, the key raw material, to its industry at a comparatively much lower price than available to Indian manufacturers much before the Indian Government awoke to the reality. Despite challenges, Indian tyre manufacturers have been able to compete successfully in view of unmistakable focus on quality and an efficient, reliable and nation-wide back-up service support. India Transport Portal: A pricing war in the TBR segment in India
Indian manufacturers are well placed to launch TBRs that compete with the best in the world.
ATMA was set up in 1975. The primary function of the Association is to be a conduit between Government Departments and the tyre companies in having two way communication. The Association projects the views of the industry on various subjects to respective Government departments. Conversely, the expectations of the Government from tyre industry are conveyed to tyre companies.
would surely lead to poor quality products. But TBR are quality driven products because of the benefits that result by using them. On the other hand, tyres get more expensive as rubber prices rise. How to cope with such reduced flexibility? Mr. Rajiv Budhraja: Pricing strategy is at the root of a market driven economy. But I cannot agree with the contention that pricing war always leads to poor quality products. As marketing experts have us believe, gradually low quality products are weeded out and the manufacturers who offer a good tradeoff between pricing and quality win the market.
ATMA We have seen that happening in case of car radials where the quality of products has consistently improved over the years while keeping prices within reasonable & affordable limits. Yes, rising cost of raw materials is a challenge. And each tyre major, in its very own way, is devising strategies to overcome the challenge through a combination of resource rationalization, better efficiencies, better product portfolio etc. The fact remains that tyre companies have not been able to pass on entirely the increased cost of raw materials to customers in view of tough competition leading to immense pressure on the bottom lines. India Transport Portal: India transportation is facing several challenges: fuel savings, carbon emission and road safety. To what extent Indian tyres can help to achieve success regarding these issues? Mr. Rajiv Budhraja: As proved by repeated researches, tyres are instrumental in meeting the all three challenges that you have mentioned. An awareness drive is on by tyre manufacturers is helping the transport sector to aim for and realize the desired gains. India Transport Portal: Daimler Indias Bharat Benz trucks recently announced their choice for JK Tyre. Do you consider this move as a strong message to be given to Indian tyre
Tyre companies have not been able to pass on entirely the increased cost of raw materials to customers.
Mr. Rajiv Budhraja is Director General of Automotive Tyre Manufacturers' Association (ATMA), the apex Industry Association representing tyre sector. ATMA membership spreads across 10 largest Indian tyre manufacturers, who account for nearly 95% of the Indian tyre production.
industry? Mr. Rajiv Budhraja: Definitely it speaks volumes about the quality consciousness of Indian tyres. In fact it mirrors the scenario in car radials where almost all the popular international models of cars are being rolled out on tyre manufactured in India. Back to table of contents
CAI
Long range trucks have the greatest potential for fuel savings
The Clean Air Initiative (CAI-Asia) and the Society of Indian Automobile Manufacturers (SIAM) coorganized the Green Freight Seminar during 11th Auto Expo. They call for a better stakeholder education and clean technologies adoption. India Representative Mr. Parthaa Bosu explains his position regarding green fleet management and radialisation. Comments gathered by India Transport Portal
Five million registered trucks and vans consume about half of fuel from road transport in India thus significantly contribute to global warming and air pollution. So there is a lot of work that can be done regarding fleets to achieve greener standards and fuel efficiency as the situation is very critical. The fact is that Asia lags far behind Europe regarding environmental standards. Since the year 2000, India started adopting European emission and fuel regulations. Today, the Bharat Stage IV is equivalent to the Euro IV norms. Europe plans to introduce Euro VI norms in 2014. So there is still a lot to do regarding the legal and political framework. Some would say there is a mismanagement regarding the fleet system but the truth is that there is not any management at all. It has never existed and it has to be entirely built up. A Green Freight Program in India has to be set up to achieve progress towards fuel savings and carbon emissions. The truck sector in India is highly fragmented. Most part of drivers own their trucks and only 6% of companies have more than 20 trucks. The highly fragmented nature of the trucking industry without strong government regulations makes it difficult to promote the use of newer vehicles and the adoption of better technologies. There is a lot of waste as multiple logistics centers around many of the Indian cities are limiting the coordination of trucks. This all contributes to the high percentage of empty hauls of trucks. Almost 20% of a vehicles fuel consumption is caused by rolling resistance. Long-range trucks have the greatest potential for fuel economy improvement and GHG emissions savings through technology applications. Stakeholders have to be educated on various aspects and, considering this background, tyre and tyres technologies are part of the solution towards a green fleet management.
There is a lot of work that can be done regarding fleets to achieve greener standards.
Mr. Parthaa Bosu has more than 11 years of combined experience in corporate affairs, corporate communications. Before leaving SIAM, he was heading the Corporate Communications. Currently he is heading the India office of the Clean Air Initiative (CAI Asia), which works on sustainable urban transport and air pollution.
Green tyres, depending of their compounds (silica etc.) are more environmental friendly. There is a need to educate stakeholders to radialisation so they can consider tyres as a tool towards greener fleet management. It is part of available strategies in international best practices that stakeholders have to learn from. Back to table of contents
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Apollo
The faith that customers shows in our products is a testimony

Mr. Satish Sharma explains how Apollo Tyres has the potential to overcome the Chinese competition. The tyre company has been the market leader in the commercial vehicle segment for the last two decades and provides high quality services.
India Transport Portal: According to Mr. Rajiv Budhraja, chinese radials came to occupy around 60% shares of the Indian TBR market. How do you explain such success? Mr. Satish Sharma: I am not sure when exactly this data was applicable, but in the current scenario the Chinese truck-bus radials would constitute less than 2 to 3% of the commercial vehicle (CV) radial market in India. With our Chennai plant producing 4, 000 truck-bus radials every day, and other manufacturers also ready with their radial capacities, there has been a significant increase in the domestic truck-bus radial capacity, which has resulted in lower imports. India Transport Portal: How would you compare the
radialisation trend between China and India? What lessons can be drawn from this experience? Mr. Satish Sharma: With more than 75% of the commercial vehicles run on radial tyres in China, the level of radialisation there is high. Having said that, the CV segment in China also took its own time to reach the level where it is now, and it didnt happen overnight.
There has been a significant increase in the domestic truck-bus radial capacity, which has resulted in lower imports.
So, Chinese tyre manufacturers and the segment, has also evolved with time and gained experience. Indian manufacturers are not far behind, with most of them putting radial capacities to meet the growing domestic demand.
Apollo India Transport Portal: Regarding this situation, in what way is Apollo Tyres different from its competitors? Mr. Satish Sharma: From being a company which was 100% into CV tyres in India and the first one to segment the market according to load and mileage requirements in different regions of the country, Apollo Tyres understands its customers and their requirements the best. The fact that customers have reposed their faith on us consistently and we have been the market leaders in the commercial vehicle segment for the last 2 decades clearly shows the advantage that we enjoy over our Chinese counterparts. Our continuous interaction with the customers and fleet owners, educating them about the benefits of radial tyres, proper fitment and maintenance, also comes to our advantage. Also the commercial user is highly service dependent. For us, being located here, with the infrastructure to provide that of service the and hand-holding, is most and the an understanding advantage. customer definitely
For us, being located here, with the infrastructure to provide that service and hand-holding, and the understanding of the customer is most definitely an advantage.
India Transport Portal: How do you balance the need for innovation with the cost issue? Mr. Satish Sharma: The Indian tyre industry has been surviving on wafer-thin margins for many years. Despite that we have continuously supported, and sometimes led, the growing domestic automotive industry with better technology products. Very few, like Apollo, have been able to remain profitable in such circumstances, where there is constant costpush, but the competitive scenario doesnt allow a price correction to be affected. India Transport Portal: How would you describe the products Apollo is offering, both on quality and cost issues, regarding this environment? Mr. Satish Sharma: The faith that customers have been showing in our products, making us the market leaders --both in the truck-bus radial and cross-ply segment is in itself a testimony to our product offering. With our manufacturing presence and experience of operating in 3 continents with diverse customer needs, we believe that we have the best product to offer at competitive prices to Indian consumers.
Apollo India Transport Portal: Indian Transportation is facing huge challenges such as road safety, carbon emission and fuel savings. How is Apollo positioned to tackle such issues? Mr. Satish Sharma: Being the largest tyre manufacturer in India, we feel that it is our corporate responsibility to educate customers on road safety and to work towards greening the environment. Through the Apollo Safe Drive initiative, we are educating drivers and vehicle owners on various aspects of tyre care and maintenance. This activity, which is conducted on highways, residential locations and corporate offices, informs motorists about the importance of maintaining correct tyre pressure, use of valve caps, tyre rotation and wheel alignment & balancing. This Safe Drive campaign from Apollo Tyres has also been recognized and awarded by the International Institute of Road Traffic Education, UK. We have been working with alternative sources of energy wherever possible. For example, our largest manufacturing unit in Vadodara, Gujarat has a tie-up with Gas Authority of India Ltd (GAIL) for waste heat recovery from GAILs gas turbines exhaust. This is a Clean Development Mechanism (CDM) project under the Kyoto Protocol. Our technology team is constantly working towards increased usage of environment friendly raw materials for our products. Carbon Black is gradually being replaced with Silica, which reduces the rolling resistance of a tyre. Back to table of contents
Our technology team is constantly working towards increased usage of environment friendly raw materials.
Mr. Satish Sharma guides all aspects of Apollos largest and most crucial market India. Prior to this, he was Chief of Marketing. A Chemical Engineer from the National Institute of Technology, Mr. Satish Sharma studied business management and international marketing at the Institute of Management Technology and Indian Institute of Foreign Trade. He began his career with JK Tyre before joining Apollo.
CEAT
CEAT TBR became instant success

Mr. Vinod Kumar presents the CEAT strategy. He explains that the tyremaker is well prepared to fully satisfy the Indian market.
India Transport Portal: Chinese radials are entering the Indian TBR market with a 60% market share. It seems that Chinese competitors are in good position to take the lion share, how do you consider the Chinese competition? Mr. Vinod Kumar: Chinese came in India when there was a gap between supply and demand. Only JK Tyre was producing decent volume. Apollo, MRF was struggling to get foothold in the market and establishing their product. Now that Indian tyre Companies have ramped up production and products are well accepted in market the Indian tyre companies will have majority share. But the Chinese will still be a threat. India Transport Portal: A lot of market commentators say that Chinese competitors provide a cheap quality offer. How do you consider the Indian TBR market? Innovation or cost driven? Mr. Vinod Kumar: Indian customer is willing to pay more for premium product. All tyre companies are increasing share of their premium products. TBR Customers are willing to pay more for good quality products. India Transport Portal: How would you describe the products CEAT is offering, both on quality and cost issues, regarding this environment?
All tyre companies are increasing share of their premium products. TBR Customers are willing to pay more for good quality products.
Mr. Vinod Kumar: CEAT did three years extensive customer and market study before launching TBR tyres in India. CEAT is one of the very few companies who got it right the first time. While other Indian Tyre companies took time to establish their products, CEAT TBR became instant success with good acceptability in market.
CEAT India Transport Portal: As you said, CEAT is focusing on radialisation and has aggressive plans with new products to capture this market. What are the CEAT advantages in this competition? Mr. Vinod Kumar: Ceat has aggressive plans for TBR. We are already approved by Tata Motors & Ashok Leyland. This is going to give us good replacement demand. Also CEAT is also strong in export markets and our TBR tyres are performing extremely well in international markets too. Ceat has already established two service centers: one in Sankari (Tamil Nadu) and another in Kodad (AP) to give one stop service for all Truckers. India Transport Portal: India Transportation is facing huge challenges such as road safety, carbon emission and fuel savings. How is CEAT positioned to tackle such issues?
Ceat has aggressive plans for TBR. We are already approved by Tata Motors & Ashok Leyland.
Mr. Vinod Kumar is Vice President Marketing at Ceat Limited. He is responsible for driving all Marketing & Customer Service agenda and processes. He has 15 years of qualitative experience in the areas of Marketing. Mr. Vinod Kumar is graduated of the Symbiosis Centre for Management and Human Resource Development and the Osmania University.
Mr. Vinod Kumar: Radial Tyre is more environment friendly as vehicle fitted with TBR consume 5- 10% less fuel then conventional truck tyre which will lead to low carbon emission also. We at CEAT have taken up the issue of Road safety and are running programs to educate school children on road safety. Our BeIdiotSafe bike tyre campaign also highlighted the need for road safety. Back to table of contents
Michelin
76 billion liters of fuel can be saved with Michelin tyres

Mr. B. Kumar explains how Michelin considers the Indian market. He speaks about the experience of the giant manufacturer regarding radial tyres and how the French company can benefit from its cutting edge technology.
India Transport Portal: Radialisation is starting to rise in India in the commercial vehicle segment. What would you consider to be the key elements to ensure the Indian market to continue its development of radialisation? Mr. B. Kumar: While the passenger car market in India is almost radialised, the big movement in India is radialisation in the bus and truck tyre segment. In India in 2010 around 14.5% of all heavy vehicles used radials and this will grow steadily. Globally, the rate of radialisation in the truck and bus segment is over 60%. Michelin is convinced that this technology enables the development of tyres that deliver fuel efficiency, safety and longevity benefits, thus providing newer and better value products to the Indian consumer. We feel that trends like infrastructure development improving road conditions and development of national highways will further push the demand for radial tyres in commercial vehicle category. Vehicle evolution and the entry of more and more hybrid vehicles in the market and a globalized truck park are most definitely going to act as an impetus to radialisation in India. The Indian auto industry continues to grow and so do the opportunities for us Michelin. We continue to launch new products, expand our distribution network and continue to work towards strengthening our partnerships with OE manufacturers. India Transport Portal: There is a tough competition.
The Indian auto industry continues to grow and so do the opportunities for us Michelin. We continue to launch new products, expand our distribution network and continue to work towards strengthening our partnerships with OE manufacturers.
Notwithstanding the Indian players, Chinese low cost competitors are entering the Indian market. How do you plan to compete in this environment? Mr. B. Kumar: The Indian market is one of the few emerging economies (e.g. Radialisation in Brazil is around 76% and China is around 60%, the world average is 65%) where the Bias tyre 34
Michelin market is still much more prevalent and will remain so for the foreseeable future. However, the move to radial technology, where Michelin has its roots and a wealth of know-how throughout the world, is inevitable given the improving infrastructure in India. Radialisation was at 14.5% in 2010 and we feel that this rate will go up to 50% by 2020, the potential is massive and we wish to be a part of this growth. Today customers are demanding more efficient logistics and supply chain and this is also seen in the context of the sale of higher HP commercial vehicles. The use of the Radial tyre not only helps the consumer save fuel but also runs longer thereby reducing the cost per kilometer. This tangible benefit to the fleet owners is encouraging the shift from nylon tyres to radial tyres. Michelin is in India to contribute to this shift towards radialisation and we are committed to ensuring the improvement of Indian mobility in the long term. India Transport Portal: On a qualitative issue, it is often said that not all radial tyres are made alike? What is your opinion about it? What are the Key Performance Indicators that need to be considered in buying a radial tyre?
The move to radial technology, where Michelin has its roots and a wealth of know-how throughout the world, is inevitable given the improving infrastructure in India.
Mr. B. Kumar: The differentiation begins right from the quality of raw materials used in the production of the tyre and then other factors like the tread design based on conditions of use, number of plies etc. play a crucial part in determining the outcome of how the tyre will perform. The key parameters to be considered for purchase of a Radial tyre are: The brand-assurance of quality and experience, The tread design based on conditions of use, The After main expectations: fuel Saving, and setup retreadability, for repairs, mileage, sales service, advice alignment etc. India Transport Portal: You are very committed with sustainable mobility. It includes road safety, fuel savings and carbon emission. But India is facing a terrible need for transportation that is mostly cost oriented. How do you plan to balance these factors? Mr. B. Kumar: The Indian market is a very demanding one and the plant that we will operate in the country will produce radial tyres for both trucks and buses to suit all major applications prevalent in India. Michelin is focused on its strategy to be a key participant in the Radialisation of the Indian Truck and Bus tyre segment. This is important for us as this technology enables the development of tyres that deliver fuel efficiency, safety and longevity benefits, thus providing 35
Michelin newer and better value products to the Indian consumer and helps driving his costs down. Fuel costs form a huge chunk of the total operating costs of a fleet owner. Michelin Tyres, the world leader in tyre technology, estimates that about 76 billion liters of fuel can be saved annually should all trucks running on bias tyres today switch to using Michelin radial tyres. Fuel savings of this magnitude, in the face of significantly rising oil prices, could potentially have an impact on the overall balance of trade for the government as well. Longer tread life, lower cost per kilometer, reduced fuel consumption, Retread technology for radial tyres, reduced downtime are some of the benefits that the end consumer derives by using Michelin truck radial tyres. To demonstrate and showcase the reduced fuel consumption advantage Michelin conducted a test to highlight savings. India Transport Portal: What should be the best business model for a tyre company that focuses on quality and innovation and not only on price? Mr. B. Kumar: The growth rates for such companies will not be rapid but a steady progress. Creating brand awareness, right advice on the tread pattern and regular tyre monitoring will be the key differentiators to demonstrate the performance and delivering overall economics through the usage of tyres for the transporter. India Transport Portal: What are the critical factors to ensure the best benefits of radial technology? Mr. B. Kumar: The consumer needs to be mindful of the following things while investing in a radial tyre in order to be able to reap full benefits from his radial tyre: Selecting the right tread pattern based on conditions of use, Proper fitment methods, Regular monitoring and air pressure corrections as required, Tyre husbandry, proper rotation and turning on rims, Alignment, Quality Radial Tyre repairs at the right time, Use of valve caps, Removal of tyres at the right time (Minimum tread depth of 2mm), Quality Retreading.
To demonstrate and showcase the reduced fuel consumption advantage Michelin conducted a test to highlight savings.
Mr. B. Kumar is Country Head Distribution at Michelin India Tyres. He was previously Head Trucks and Buses at Michelin India Tyres. Prior to this, he spent more than ten years at Castrol India Limited where he was National Manager Distributors.
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Special Issue April, 2012

INSIGHTS & ANALYSIS

India Transport Portal, 2012

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The rise of radialisation in India

Domestic tyre market share in T&B segment (%)

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Product Wise Tyre Demand (%)

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Tyre Segment Wise Volume (%)

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Chinese radial tyres

Impact of Chinese radial tyre on India

Import trends of TBR

1600 1400 1200 1000

140 120 100 80 Imported radial tyres (In '000 Nos)

success Chinese manufacturers like Hangzhou Zhongce Rubber

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Radialisation Trend By Segments

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Chinese radial tyres

T&B Tyres (in %) Source : ICRA, Annual reports

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Different types of radial tyres

Different types of radial tyres

Table 1: Average Indian Radial vs. Cross Ply T&B tyres

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Radial tyres and fuel savings

Table 1 Distribution of energy consumption

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Graph 2: Contribution of tire components to rolling resistance

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Graph 3 : Cap & Base construction

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The other lives of a radial tyre

Figure 1: Retreading processes

India Transport Portal

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Retreading because under such

Tyre Retreading at Sun Tyre

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The progress of radial technology for trucks