French tyre manufacturer Compagnie Generale des Etablissements Michelin today signed a memorandum with the Tamil Nadu government for setting up a Rs4,000- crore manufacturing facility in Tiruvallur district near Chennai.
Michelin will manufacture radial truck and bus tyres and the plant would start operations in 2012. The facility would create direct employment for 1500 people, Michelin Africa-India-Middle East president Prashant Prabhu told reporters in New Delhi today.
"Michelin is extremely grateful to the state of Tamil Nadu for making it possible to have access to land and infrastructure to be able to build our factory," he said after exchanging documents with chief minister M Karunanidhi and state government officials at the secretariat.
Philippe Neyrat, commercial director at Michelin's India unit, added, "An increase in the focus of the government to build better roads to support the challenges of mobility of people and goods in India will result in an ever-increasing demand for radial truck and bus tires."
The rise in demand for automobiles has prompted several Indian and foreign tire makers to invest in the country. These companies are betting not only on the increasing demand in the local market but also want to use the low-cost manufacturing base in India for exporting tires.
Prabhu said the factory would be built up in phases on 290 acres of land at Thervoy Kandigal in Thiruvalluvar district, situated about 50 km north of Chennai. He added that the production at the facility would be focused on serving the domestic market.
Prabhu said Chennai's connectivity and talent pool made them set up the facility, the company's first in India. Michelin, as famous for its 'fat boy' tyres as for the publication of Europe's most famous fine-dining guide, has 68 production sites in 19 countries.