MAHARASHTRA, India—Off-highway tire manufacturer Balkrishna Industries Ltd. (BKT) is budgeting $100 million for the plant it is planning to build in the U.S., the company disclosed in a Nov. 8 news release.
BKT Chairman and Managing Director Arvind Poddar disclosed his company's plan for a U.S. plant on Oct. 29 during his Hall of Fame acceptance speech at the Tire Industry Association awards ceremony in Las Vegas.
The new factory will be BKT's first factory outside of India and fifth tire plant overall. BKT is India's fifth largest tire maker and No. 39 worldwide, based on fiscal 2017-18 sales of $692 million.
To move the project forward, BKT will establish a new subsidiary in the U.S., and its first task will be to select an appropriate site for the plant and acquire the land, which should be finalized by by the end of the first quarter next year.
The company said it expects the new plant to open in the first half of 2021 with a nameplate capacity of 20,000 metric tons per year. That's smaller than any of the company's four plants in India. By comparison, the company's newest factory, in Bhuj, Gujarat, is rated at 130,000 tons per year.
BKT expects to make finalize site selection before year-end and complete the land acquisition.
BKT said its sales of $692 million represents about a 6 percent share of the global off-highway tire business. The company's goal is 10 percent by 2025.
About 85 percent of the firm's fiscal 2017-18 revenue was generated in markets outside of India, including roughly $93 million in North America, according to BKT's financial reports.
In a November investors presentation, BKT said the new plant would allow it to accelerate its business with North American equipment makers by being able to offer faster deliveries as well as enable it to export to neighboring countries "in a more competitive manner."
BKT has made significant OE inroads with North American-based off-highway equipment makers, Joint Managing Director Rajiv Poddar noted at the Oct. 29 TIA event, where he accepted the group's Hall of Fame honor for his father, who was unable to attend because of the recent death of his uncle, Dharaprasad Poddar, chairman emeritus of the company.
Arvind Poddar made his acceptance speech in a videotaped message.
Europe is the company's largest market, accounting for more than half of annual revenue.
BKT is represented in North America by BKT USA Inc. in Fairlawn, Ohio.