German global rubber specialty company Lanxess believes that out of the 31 markets it is present in, India and China will be the best bets in the coming year.
With this in mind, the company has invested 400 million euros to build a butyl rubber plant in Singapore. The plant, which has a capacity of 100,000 metric tonne, will supply rubber to the Asia Pacific market, which is currently the fastest growing region for Lanxess.
Halo butyl is used in the manufacturing of tyres in passenger cars, trucks, bicycles and also tubes.
Joerg Strassburger (pictured), managing director and country representative of Lanxess India, said the opening of this factory will help them in cementing their position in the Indian tyre market.
“Earlier when we were importing from other factories in Europe, etc the time taken to get the necessary supplies was between four and six weeks. Now with this plant the time can be cut down to five days,” he said. The company believes that going ahead this is going to be a huge competitive advantage.
Swaranjit Singh, materials director at JK Tyre that sources rubber from Lanxess, said, “One of the huge challenges for the company so far has been managing supply constraints. With this plan in place the business for the company will definitely increase from India in the coming years.”
Strassburger said a quicker supply will help the tyre companies in sorting out inventory problems. “This will ensure that companies no longer need to carry huge inventories.”
In India the company mainly competes with other global players such as Exxon Mobil and Sinopec in the butyl rubber segment. Earlier Reliance Industries had also announced that the company will set up a joint venture with Sibur, a Russian petrochemical major, to produce butyl rubber in Jamnagar. The plant is expected to be operational by 2015.
In the last few years, Lanxess has invested about Rs 1,300 crore in India in greenfield investments, acquisitions and in upgradation of assets.
With Singapore plant, Lanxess eyes larger pie of Indian tyre mart
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