MUMBAI, India — Citing rising demand in North America and Europe for off-highway tires, Indian tire maker CEAT Ltd. has disclosed plans to boost production capacity for radial off-highway tires at its plant in Ambarnath, India.
The company's board of directors recently approved an investment of $45 million to boost capacity for radial off-highway tires by 10% to 55 metric tons per day at the five-year-old factory in India's Maharashtra state.
At the same time, CEAT has put on hold a plan to invest in boosting capacity for commercial truck/bus tires, declaring that the off-highway sector offers greater returns.
CEAT's off-highway tire output is predominantly for export, with Europe and the U.S. the largest off-take customers. CEAT is represented in the U.S. by a wholly owned subsidiary, CEAT Specialty Tire Inc. of Charlotte, N.C.
The expansion of radial capacity is on top of an ongoing investment program at the Ambernath factory, which is designed to increase overall capacity to 105 tons a day by mid-2024 from 80 tons currently.
At the same time, CEAT said it is converting about 18 tons of daily bias truck-tire capacity at its Bhandup, India, plant to bias-ply off-highway tires.
Overall, CEAT has budgeted $95 million for capital expenditures during fiscal 2023.
Earlier this year CEAT Specialty Tire CEO Amit Tolani told Tire Business that his company was increasing capacity in line with efforts to expand its portfolio to serve both original equipment and aftermarket customers.
In particular, Tolani said CEAT Specialty Tires is making inroads on securing OE fitments in North America with heavy equipment manufacturers, most notably AGCO, CNH, John Deere and JCB machines.
"CEAT is in a good position in North America with farmers dealing with high input costs but still requiring the latest ag tire technologies," Tolani said. "We can provide farmers technologies such as (very high flexion) and (increased flexion) tires at accessible prices to allow them to lower their overall farm operating costs."