By Bruce Davis, Crain staff
Mexico City -- India's JK Tyre & Industries Ltd., the new owner of Mexico's Compania Hulera Tornel S.A. de C.V., is shooting for sales of $250 million in North America by year-end 2009, selling both the JK and Tornel brands in the US and Canada for the first time starting next year.
JK Tyre, the world's 23rd largest tyre maker with 2007 sales of $780 million, acquired Mexico City-based Tornel in May for $68 million and has indicated it will spend millions more to add moulds for the JK brand at Tornel's plants and upgrade the plants' capabilities.
JK plans to launch the Tornel and JK radial passenger and light truck brands to US customers next summer or fall, according to R.P. Singhania, JK vice chairman and managing director. It will sell through selected dealers.
Negotiations with the targeted dealers are under way, but Mr. Singhania did not name any possible distributors at this time nor discuss the firm's marketing plans for the launch. Up to now, JK has had little if any presence in the US or Canada and only a limited presence in Mexico, primarily in cross-ply truck tyres.
Globally, JK derives only about 15 percent of its annual sales from exports, with about half of that coming from the Middle East and Africa, according to JK financial reports.
JK said it already is adding moulds for the JK brand to Tornel's plants for production starting before year-end. It said capital investments will be required to improve quality, efficiency and full capacity utilisation but declined to quantify their size.
JK Tyre is part of JK Industries, an Indian company founded in the late 19th century.
The firm ventured into tyre making in 1976 with its first plant in Kanroli, Rajasthan, India, moving into tyre manufacturing from a role as a supplier of rayon and nylon cord material. It added a second factory, in Mysore, India, in 1980, and in 1991 took over the financially ailing Vikrant Tyre in Banmore, India.
The parent company is active in a variety of fields, including paper, cement, power transmission belts, dairies, sugar, insurance, etc.
From Tire Business (A Crain publication)