After receiving the necessary approval from its Board of Directors, on the proposed investment towards setting-up a Greenfield facility in Eastern Europe, Apollo Tyres today confirmed Hungary as the location for the same. Hungary was chosen after a consideration of various factors over some of the neighbouring Central Eastern European and Asian countries.
Apollo Tyres will invest Euro 475 million over the next 5 years to setup this facility in the new industrial zone near Gyongyoshalasz, Hungary. Once completed, the plant will have a capacity to produce 5.5million passenger car & light truck (PCLT) tyres and 675,000 heavy commercial vehicle (HCV) tyres per annum. This facility will produce both, Apollo and Vredestein branded tyres, and will cater to the entire European market and will complement Apollo Tyres’ existing facility in the Netherlands.
Commenting on this decision, Neeraj Kanwar, Vice Chairman and Managing Director, Apollo Tyres Ltd said, “This investment would be our first one into a Greenfield facility outside of India and would be a significant milestone in the company’s international growth journey. Our aim is to create a benchmark manufacturing facility, which would further increase our competitive strength in the European market.”
Peter Szijjarto, Parliamentary State Secretary to the Ministry for Foreign Affairs and Trade, Government of Hungary said, “Apollo’s Hungarian investment is an important step in the re-industrialisation of Hungary.”
The chosen site is less than 100 km from Budapest (capital city of Hungary) and meets the needs of Apollo Tyres including having close proximity to various OEM manufacturers as potential customers. The company will soon start the process of applying for necessary permissions and licenses to setup the facility. Similarly, the process towards Environmental Impact Assessment will be started soon. The construction of this plant is expected to start in the spring of 2015 and the first tyre is likely to roll out in early 2017.
Mr Kanwar further added, “Apart from providing direct job to 975 people, of which majority would be hired locally, this facility will also lead to creation of indirect jobs and contribute significantly to the development of the region. As an organisation, we strongly believe in ‘Care for Society’, and we would actively participate in addressing the health, safety and environment issues of the community.”
Currently, Apollo Tyres has 4 manufacturing units in India, 3 in southern Africa and one in the Netherlands. The combined production capacity of all facilities put together is 1700 tonnes per day.