We have the capacity and infrastructure ready for radials in OTR segment. But can we offload the entire capacity is a big question. Once the answer is affirmative then there will be no looking back. S Sengupta, Head OTR Business, JK Tyre & Industries Ltd, speaking with Sudheer Vathiyath, says that his company is waiting for the right opportunity to enter the radials in OTR segment. Excerpts of the interview.
What are the latest trends towards application-based off-the-road (OTR) segment, especially in the radial tyres?
Complete switchover to radials cannot happen immediately in the OTR segment because it requires development of complete service infrastructure including repair facilities at the job site and retreading. This service infrastructure is a must for obtaining full benefits of 'expensive' radial OTR tyres. Moreover, gross improvements in the standards of maintenance of application like open cast project's haul roads, loading and dump areas are another necessary aspect before a customer moves in for radialisation. All these require huge investments including initial purchase of radial OTR tyres, which are more expensive as compared to their bias counterparts.
Describe the journey of JK Tyre in the OTR segment.
JK Tyre has been focused in the OTR segment since 2001. From 2001 till date, the journey of JK Tyre has been full of success and growth. Today, we have a market share of 40 per cent in the domestic OTR market.
In 2009, JK Tyre has installed an exclusive OTR tyre plant in Mysore (Karnataka), where we already have one of our truck radial and bias tyre plants. In this plant, we manufacture the smallest tyre for industrial application to the largest 57 inch tyre existing in India. We have also developed all the major ultra large OTR tyre sizes, as well as tyres for small OTR applications, loader and grader tyres in bias range.
How do you look at the scenario of radialisation in India?
JK Tyre plans to enter into radials segment. Radialisation has started in India, but it is very slow. Even today, the major chunk goes into bias tyres. Radials are imminent and are the future, but the progress has slowed down in the recent past in India. We have a total range of radial tyres for trucks and buses, passenger cars, light commercial vehicles and farm tractors. JK Tyre has the technology and we can start radials for OTRs anytime.
What is needed for radialisation to be successful in the OTR segment?
We have taken the service route in bias tyres. Similarly in radials we will have to provide effective and efficient service to the customers. You will have to offer a total service package to customers along with the sales offer. You will also have to look into the radial tyre management for them. We cannot just sell radial OTRs and leave it to the customers for doing the tyre management. Radial tyres will of course give better performance than bias tyres, provided they are cared and maintained well. Moreover, as said earlier, the total tyre management package must include on-site repairs, which will reduce equipment down-time to a great extent and also include tyre retreading.
What kind of service support do you provide to your customers?
We have our own dedicated and trained service team. We have tyre retreading in our facility for non-OTR tyres, which can be extended to OTR radials. We have developed a module for total tyre management called "Total Solution" by which we will sell service along with selling tyres. In other words, we provide a total package through "Total Solution" and meet customer's OTR tyre needs.
In India, what is the current market share of radials in the OTR segment?
According to me, in value terms, the ratio is 70 per cent bias and 30 per cent radials in OTR segment. The radials are [mostly] imported. In unit terms, it can be 90 per cent bias and 10 per cent radials.
How do you look at the opportunities for radials in the OTR segment?
There is a huge opportunity for radials. But if you set up a facility altogether whether the facility will be fully loaded for India will remain a question mark at this point of time. However, we are playing the wait and watch game. At the same time, we are preparing ourselves particularly through our "Total Solution" route.
After all, radialisation has to happen, whether it is 5 or 10 years down the line. Who would have thought that our passenger car segment will be totally radialised?