ESSEN, Germany (June 3, 2010)—Indian tire maker Apollo Tyres Ltd. expects to have European original equipment fitments with its Apollo brand in the next three to four years, and is aiming to triple its annual sales by 2015 to more than $5 billion.
Apollo Tyres already has good relations with European car makers, such as BMW A.G. and Volkswagen Group through historical links with Vredestein in Europe as well as OE contracts with Apollo in India and, in VW's case, South Africa, according to Marc Luyten, chief marketing officer.
“We are not starting from scratch,” he said during a press reception at the Reifen industry trade show in Essen, where Apollo formally launched the Apollo car tire brand for Europe.
Apollo can build on its existing technical and commercial links with these companies to bid for OE contracts in Europe, Luyten said. Apollo expects such efforts will result in contracts to supply OE contracts in Europe for models launched in three to four years' time.
In India, the Apollo brand is a positive benefit to BMW and other brands in India, where Apollo is a respected market leader—but that is not yet the case in Europe, he said.
In the coming three years, Apollo expects to invest in a major promotional campaign to make the European consumers aware of the Apollo name. This, he said, will ensure that Apollo-branded tires will add to the image of its OE partners.
He said consumers need to be aware of the brand and to have a positive association with it, but they do not need to recall the name unprompted. He said that the dealers makes a large part of the buying decision, so Apollo will aim to offer dealers a good margin on the Apollo products, in order to persuade them to sell the tires to the consumer.
Luyten said the Apollo marketing campaign will involve sports sponsorship. He said it was unlikely to be a sport where tires are an existing sponsor and he specifically excluded soccer and motorsports.
Initially, Apollo is concentrating on building dealer networks in Germany, the Netherlands and the United Kingdom. Apollo is entering the European market with a range of summer, winter and 4x4 tires in T- to Y- speed ratings.
Globally, Apollo will be the brand for OE and for the full range of products, which eventually will include industrial, agricultural and off-road products in addition to car and truck tires.
Vredestein will continue to be a replacement-only car brand. In Europe, the brand will maintain its existing positioning, but in the rest of the world, Vredestein will be positioned as a premium, specialized brand, focusing on winter applications and high performance, with a minimum speed rating of V in all parts of the world outside Europe.
Apollo said it also will bring its other brands into Europe in the coming years, such as Kaizen and Regal, though plans for these brands are less advanced at present.