Michelin may source tyres from Apollo

French tyre major Michelin, which recently picked up a stake in Apollo Tyres and set up a joint venture manufacturing company, will source car and LCV tyres from Apollo under Michelin sub-brands for global markets.

A company spokesperson said that the tyres will be made and marketed under some of Michelin's sub-brands like BF Goodrich.

He reiterated that Apollo will produce these tyres only after Apollo's plants are upgraded to worldclass levels using Michelin's investments and technology.

Michelin picked up a 14.9 per cent stake in Apollo Tyres for Rs 129 crore, and also set up a 51:49 joint venture with it for manufacturing and marketing truck and bus radials.

As part of the agreement, Michelin will transfer technology to Apollo Tyres to upgrade its plants, which will later start manufacturing tyres for the global market. The tyres will be sourced by Michelin and marketed in the international markets.

During the announcement of the tie-up executives of both the companies had said that the new joint venture, Michelin Apollo Tyre, will invest close to Rs 322 crore over the next four years to build a greenfield manufacturing unit.

Production was expected to begin in September 2005. This company would start marketing imported tyres from April 2004.

On the other hand, Kanwar's flagship firm Apollo Tyres in which Michelin will bring in technology, will make car tyres which can be sold under the Apollo brandname.