Michelin & Cie, the world's second largest tyre maker is planning to invest Rs 7,000 crore ($1.48 billion) over a 10 year period in India to make and market radials tyres and tubes.
Michelin is currently in talks with the Indian authorities for the project deemed to be one of the largest FDI inflow into the country. This is a result of the joint venture with the Delhi-based Apollo Tyres which failed to take off. Apollo Tyres has already given a NOC (No Objection Certificate) to the French tyre giant to start its operations in India.
Michelin has sought the aproval of the government tp acquire 100 per cent stake in a new company Michelin India Tamil Nadu Tyres formed in April 2009. The company will set up the proposed greenfield unit, which would absorb investment worth Rs 4,000 crore in its first phase running into 2016.
The first phase of the proposed project in Tamil Nadu would provide jobs to around 1,500 people, which may go up to 2,000 after further investment of Rs 3,000 crore is made in the second phase.
Demand for tyres has fallen across the globe in the past few months citing the economic reccession. However the tyre sales in India has not been affected due to the rise in passenger car and two-wheeler sales.