Apollo Tyres India Ltd.'s Growth Strategy: Treading Global Markets
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Case Code: BSTR397 Case Length: 18 Pages Period: 2005-2011 Pub Date: 2011 Teaching Note: Not Available |
Price: Rs.500 Organization: Apollo Tyres Industry: Tyres Countries: India; Europe; Africa Themes: Globalization, Industry Analysis, International Business |
Abstract Case Intro 1 Case Intro 2 Excerpts
Industry Overview
Original Equipment Manufacture (OEM) and replacement were the two areas where demand for tires arose. The OEM demand fluctuated with the production of automobile and construction equipment while the on-road vehicle population, road conditions, etc., played a role in the fluctuating demand for replacement tires. The global tire market, which slumped due to the recession of late 2008 and 2009, soared in 2010 by nearly 20%. However, the global tire industry, which was valued at US$140 billion in 2010-2011- with the replacement market accounting for three-forth of the total sales - was expected to grow at an average rate of 13%. The top three companies - Japan's Bridgestone (16.2% market share), France's Campagnie Generale des-Establissements Michelin (Michelin) (15.5%) and US's Goodyear Tire & Rubber (12.4%) - accounted for 44% of the global sales. US's Continental Tyres, Pirelli of Italy, and Sumitomo of Japan were the other major players in the global tire market. While mature markets accounted for 70% of the demand, over the next five years (2011-2016), the demand was expected to come from fast growing newer markets, which included China and India. Sensing the trend, Bridgestone and Goodyear had already established their facility in India and Michelin was in the process of doing so, as of 2011...
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