India's top tyre firm opens Mideast base
Dubai, June 23, 2011
India-based Apollo Tyres, a leading tyre manufacturer, has opened its Middle East base in Dubai, with plans to cater to the region with exports out of India.
Apollo’s first and largest office outside its operations in India, Southern Africa and The Netherlands, the 2,000 sq ft office located in the Jafza Free Economic Zone will also be the reporting base for employees in Iran, Saudi Arabia and Turkey.
The region has traditionally been one of Apollo’s strongest export markets, out of India, accounting for about 30 per cent of export revenues, a company statement said.
The $2 billion company already has a distribution network in the Middle East, spanning 14 countries and 23 business partners, the statement added.
“As a company we are currently in our second phase of global expansion. The Middle East region has always been a natural extension of our markets in India. Our tyres have enjoyed a very high demand in the region, for years now,” said Satish Sharma, chief, India Operations, Apollo Tyres.
“However, due to capacity constraints at our end, we have not been able to fulfill the local demand. I am happy that we have crossed that. With an active sales and service team based here, we will now be able to provide our customers in the Middle East the service and operational excellence they deserve.”
“We plan to triple sales to roughly $250-$300 million in the next three to five years. The Middle East is our biggest export market, representing about 30-40 per cent of our export earnings. The equity of our brand is much ahead of its availability in the market,” he added.
Apart from an office, the company has also taken up an expandable 10,000 sq ft of warehousing space in Dubai, to stock its tyres locally for speedy demand fulfillment in the region.
This also enables business partners to have low inventories, cutting down on stocking costs; the ability to pay in local currency with no bank charges, and of course faster demand fulfillment to the end customer.
“The office, network of employees and local warehousing facility will allow us to address customer demands effectively; while our entire range of tyres tuned to this market, along with our service proposition, will allow us product leadership over time,” said Sharma.
“This is a high potential market, where the Dubai tyre distribution and re-export trade is valued at $1.5 billion, and expected to grow by 30 per cent in the next 5 years. In that time frame I am looking at Apollo garnering a high single digit, if not 10 per cent, of this market’s share.”
Apollo Tyres has already invested around $250,000 in creating appropriate permanent infrastructure for its business needs in Dubai; and is projecting investments and expenses of around $1.5 million on an annual level, starting this year. – TradeArabia News Service