JK Tyres to raise prices by up to 5% from Jan

Tyre-maker JK Tyre and Industries plans to increase tyre prices by up to five per cent from January next year to offset surging raw materials costs, especially that of natural rubber.

"We will increase tyre prices by four to five per cent from January to offset surging raw materials costs, especially of natural rubber," JK Tyre and Industries' Vice-Chairman and Managing Director Raghupati Singhania told reporters on the sidelines of the Indian Car and Motorcycle of the Year awards organised by JK Tyre here.

"We are forced to hike tyre prices due to increasing natural rubber prices. We may hike tyre prices more if rubber prices continue to increase," he said, adding "the price increase will apply to both car radial and truck tyres."

JK Tyre plans to double its capacity of commercial vehicle radial tyres to 1.6 million per annum from the present 8,00,000 tyres per year by mid-next fiscal.

The company also plans to increase its passenger car radial tyre capacity to 5.5 million a year from the present 4.5 million by December next year.

"Our passenger car radial tyre capacity will go up to 5.5 million a year from the present 4.5 million by December 2011," Singhania said.

The company plans to invest Rs 1,500 crore to set up a new manufacturing plant near Chennai in Tamil Nadu which is expected to start production by the third-quarter of next year.

"Our Chennai plant will have a capacity to produce 5 million passenger car tyres and 4,00,000 truck and bus tyres per year," he said.

At present, the company has five plants -- one each in Rajasthan and Madhya Pradesh and three plants in Karnataka.