Introduction
Apollo Tyres was founded in the late 1970s during the period when the Indian tyre industry was extremely competitive. In India, the main manufacturing locations are at Kerala, Vadodra, and Trichur. Apollo Tyre Company is the first tyre manufacturing and distributing company to have managed to successfully launch some exclusive outlets for tyres for trucks. Moreover, it is the only Indian company to have introduced radial tyres to the market for the farm or tyre industry category (Bajpai, 2011).
Moreover, other than producing automotive products, the company also used to specialize in the manufacturing of different kinds of rubber products for instance indoor soccer balls, boots, floor covering products, tennis balls, shoe heels, and so on. This was the time when local and international key players were highly competitive for the market share hence making the license raj to be prevalent up to date (Sharma, 2007). Regardless of that, it should be noted Apollo as a family run business enterprise has been transformed over generations as a result of changing leadership as well as con tenuous business innovations. This is what has made it to be one of the emerging business players in their industry (Bansal, 2008). Furthermore, in order to strengthen itself in the industry, the company has been coming up with extensive innovative marketing techniques.
The vision of the company entails becoming the premium trye manufacturing business enterprise with multinational and diversified presence. Conversely, its core values are concerned with the instincts of the company. This is to say that it is about the way its management authority thinks about diversifying the economic base of the company. Moreover, this involves the manner in which the company as a whole interacts with the whole world and in line with its culture. This then means that its core values as basically a system of value which assists in defining who they are and the method they use in carrying out is economic or tyre manufacturing activities (Bajpai, 2011).
Succession
Having been incorporated in the late 1970s, its tyre manufacturing activities was first carried out in Perambara. The second tyre manufacturing plant was commissioned by the company at Limda in the year 1991. In 1995, the company managed to acquire Premier Tyres. In the yar 1996, exclusive tubes were also launched by the company in Ranjangoan in Maharastara. By 2000, Apollo came up with newer strategies of manufacturing exclusive radial tyres in Limda. Regardless of that, it should be noted that by 1909, the company was relocated to Loosduinen before rebranding its trading name to NV Rubberfabriek Vredestein. The reason for that is because at time time the majority of the industries which were located in Loosduinen were up in flames. Therefore, the main activity which was being undertaken there was the reconstruction as well as the establishment of newer industries hence the need of establishing the tyre industry too (Bajpai, 2011).
By 1946, NV Nederlandsch was founded by the American company B.F. Goodrich. This company at that time owned about 20 percent of its total shares invested in the company by other potential investors (Sharma, 2007). After duration of one year, Enschede was considered as being the cornerstone of the company. With time, the day-to-day tyre manufacturing activities was accelerated as a result of merging with N.V.Rubberfabrieken Hevea. By the late 1971, although B.F. Goodrich have completely acquired the company, the products of Vredestein had also managed to be distributed to at least 125 different countries globally.
On the other hand, because of the globalization influence, Vredestein brand was mainly focused on industrial, agricultural, car, and other two-wheeled tyres vehicles. Contrary to that, the oil crisis which had compelled the economy that time forced many tyre manufacturing companies to merge. The made the Dutch to take over at least 49 percent of the invested shares in Vredestein. Two percent of these shares were acquired by the foundation for the continuation of Vredestein. The remaining 49 percent was possessed by B.F Goodrich although later the Foundation took it over just for a symbolic sum. In 1990s, three Dutch potential investors completely managed to acquire the company. This was a strategic plan which was already in existence (Bajpai, 2011).
In 2009, Apollo Tyres Ltd acquired Vredestein hence changing its name to Apollo Vredestein BV. Despite that, the large scale production of automotive tyre products still takes place in Endchede. Conversely, Netherlands is also experiencing major expansion in its tyre production activities. It is estimated that about 6 million winters or summer tyres are manufactured in Enchede yearly. High quality agricultural tyres are also produced in addition to that which is manufactured in India. Specialized companies which are located in East Asia are the one which mainly embarks on producing tyres for two-wheeled automobiles as compared to those which are manufactured by Apollo Company (LTL, 2010).
In accordance to that, in order to expand its economic base, in 2003, its management authority decided to enter into alliance with Michelin. The reason for that was to assist both companies to set up a common venture company by the name Michelin Apollo Tyre Pvt Ltd. In the process of integrating their manufacturing techniques, it is explained that it was to be easier to produce branded bus and truck radial tyres not only in India but also from other manufacturing branches which are located in other foreign countries (Bansal, 2008). In 2004, the company managed to manufacture the first high speed rated tubeless tyres in India. This in return increased its production capacity of both the automotive tubes and automotive tyres by 41400 Nos and 1283560Nos respectively in the same year and in the upcoming years.
Furthermore, this company had plans of becoming the global manufacturer and distributor of automotive tyres from 2005. Therefore, in order to realize that dream, fully owned subsidiary companies were incorporated into the company. The first step was to incorporate Apollo Holdings Pvt Ltd of Mauritius and form Apollo Radial Tyres Ltd and Apollo Automotive Tyres Ltd as a fully owned subordinate of the enterprise. Contrary to that, PTL Enterprise Ltd decided to operate on its own unlike being the subsidiary company of Apollo. It also resigned its partnership with Michelin. Despite of that, the financial records of the company kept on indicating that the production capacity of the company continued to increase tremendously (Sharma, 2007).
In respect to the vision and mission of the company, its products are mainly marketed under two global brands i.e. the Vredestein and Apollo. Both of these products are extensively and readily made available in several countries through the use of vast network of branded. Mainly, multiple manufacturing units are located in Hungry, Netherlands, and India. In connection to that, so as to be in the position of understanding as well as catering for the needs of their esteemed customers, the company mainly focuses on the training of its workers (McQueen & hoopla, 2016). Likewise, after becoming the leading player in the Indian tyre industry, the company had the capacity of being operated globally. Yet, the company is under scrutiny so as to determine whether it has the potential of carving a niche in the world front.
After being incepted in the late 1970s, the company has grown to the extent of becoming the leading Indian tyre manufacture. Moreover, the company is perceived as being young, dynamic, and ambitious business organization that takes pride of its unique identity in the industry. The company has been built on the core principles which entail the establishment of stakeholder’s value via the general reliability in its products as well as the dependability in its relationship (Sharma, 2007).
In connection to the market share, it has been perceived that the company has been presenting strength and market dynamism strategies from its early years of establishment. This mainly involves strife in establishing itself in the tyre manufacturing activities within the closed Indian economy. Over the two decades that have passed, the company used to work on the portfolio of its products, turning to the needs of esteemed clients as well as coming up with an array of innovative marketing initiatives which are all aimed at establishing itself as a leader in its home market. Some of these strategies used by the company include segmenting clients through their mileage and load requirements, establishing client contact program, tyre loyalty programs, introduction of India first radial, and first high-speed tubeless passenger car tyres (LTL, 2010).
Nevertheless, the company has been ventured in other foreign countries. As the company continues to expand, it acquired Dunlop Tyres International Pty in South Africa hence managing to the second tyre in leader southern Africa. Currently, the company contains all the Dunlop brand rights for about 30 African states. In 2009, Vredestein Brand B V was also acquired by Apollo in the Netherlands. This was advantageous to it because it gave the company to opportunity of adding Europe as its third important market. In 2010, the company also managed to enter the Bangladesh market through partnering with Rahimafrooz Distribution. Rahimafrooz Distribution is the main manufacturer and distributor of various automotive as well as industries batteries. In other to continue expanding its economies of scale, the company also decided to enroll itself into a supplementary memorandum of understanding (MoU) with Tamil Nadu government. The main objective here was to ensure that it has increased its level of investment in the country to about Rs 2100 crore as to be part of its Greenfield project. This was also a back of its speculated demand for its products.
In connection to that, the company is currently involved with the production of a white range of automotive products mainly tyres for both the high and ultra speed busses, trucks, cars, off-the road, industrial as well as other applications for instance retreaded tyres, mining, and retreading materials. These are the mainly produced across the eight manufacturing sites throughout india, South Africa, and Netherlands. Conversely, it should be noted that the ninth facility being constructed in southern India so as to diversify its economic base (LTL, 2010). This then explains that the major brands which are manufactured across all these locations are Apollo Tyre and Dunlop tyre manufacturing company.
For the three domestic markets located in Europe, Sotuh Africa, and India, the company makes use of multi-products, and a network of branded strategies so as to operate in them. For instance, in South Africa, Dunlop zones are the main branded outlets which are used by Apollo Tyre Company. In India, the Apollo Tyre World is the brand name which is used for commercial vehicles while Apollo Radial World is the main brand name which is used for passenger cars. Moreover, the products which are exported from all these manufacturing locations sum up to 70 percent globally. The key destinations for these products are South-East Asia, Africa, Europe, and Middle East.
In addition to that, manufacturing of the right products which ultimately meets the demands of their customers is paramount for Apollo Tyres Company. As a result of that, special and strategic efforts are always made for the purpose of understanding both the needs and segments of their market accordingly. This then means that the products that the company offers are mainly manufactured for the niche applications in a larger percentage. In the process of distributing it globally, the company has the potential of providing sufficient, fuel and cost-saving tyre products to every customer segment (McQueen & hoopla, 2016). Additionally, engaging in extensive innovative activities is remained to be an integral part or strategies used by the company in carry out its day-to-day manufacturing activities. This is perceived as being the best step as far as product development and its marketing is concerned as well as how the enterprise as a whole will be challenging the existing tyre manufacturing companies in their industry (Bajpai, 2011).
Likewise, community involvement is also another integral part of the Apollo Tyre World. This is also in line with the launching of various programs which are directly associated with its business activities (LTL, 2010). In India, for instance, the main focus of the Apollo Tyres entails finding affective means which will enable it to directly benefit its clients or customer groups.
Currently, it was noted that the company also managed to take over the manufacturing rights of Reinfencom GmbH. It should be noted that Reinfencom GmbH is the leading retail business organization in Germany. Equally, it has over 37 branches nationally with several partners all over Germany. Thirdly, because of its global online oriented platform, the company used to be the 2nd online car distributor in the whole of Europe. This then mean that acquiring it was to enable Apollo Vredestein- the fully owned auxiliary of the Apollo Tyres Ltd- to have the capacity of developing clear and concise returns for all of its already established partners both in Europe and Germany tyre trade.
Moreover, the above acquisition strategies were one of the strategies that the company had to use in expanding its retailing network in the European market. This also meant that this was to permit the company in supporting the general expansion of the subsidiary Apollo Vredestein. The major plans of the company also entail expanding its existing equipment activities. So as to realize that, the company also lays a strong foundation for all of its manufacturing activities through the general reconstruction of new plants in Hungry (Bansal, 2008)
Considering the modern evolution of the automotive tyre industry towards a few independent trading partners, the company keeps on encountering an increasing and growing complexity of the online marketing (LTL, 2010). As a result of that, its management authority believes that the decision made to acquire Reinfencom GmbH was a good step of maintaining its value and supply chain. The main objective here was to increase their sales volume, intensifying their customer support as well making customer orientation to be more and more consistent and dependable.
Strengths
With respect to the above considerations, the general integration of the company enables its management authority to enhance the presence of their company with respect to the needs of the end user. This in return enables them to create a competitive advantage for the company in their industry. The management authority is also confident that their recent partnering will be beneficing to the company i.e. from the increased brand awareness creation (McQueen & hoopla, 2016). Furthermore, there has been an increasing trend of the company in terms consulting their end user. The reason for that is not only because of the invention of the pressure monitoring system but because of the customers’ choice and preferences which have not become more complex (Bansal, 2008). Thus, this partnering is the one which gives the company the opportunity of meeting the ever increasing demand of the customers. In this case, the objective of the Apollo Tyre company is to continue growing with its partners basically in tandem. This is essential because it enables the company to bring their customers and products together. This is to say that the aim of the company is to ultimately maintain its logistic concept. Decreasing the storage time, optimizing the delivery times, as well as maintaining high margins throughout all the stages are the main means that the company will be using to realize these objectives at hand (Bajpai, 2011).
The commitment of the Apollo Company, as explained by its management authority, permits the company to realize their goals in European and Germany retail markets faster and conveniently. The strength of the company is customer satisfaction. The company contributes a lot particularly in areas concerning logistics and customer services wholeheartedly. Its future partnership is also perceived as the key for making the company to be more and more successful in the tyre industry (LTL, 2010). Other than these partnering, the company looks forward in intensifying its production capacity which will offer it an outstanding platform for further development. In return, it has been noted that other than developing a stronger brand presence but increase the price stability in their respective markets (Bansal, 2008).
The fact that the company has the potential of accumulating activities for instance sales promotion and advertisements means that it will have the ability of supporting its longstanding partners. This will also improve the efficiency of all of their day-to-day business activities as a result of intensified marketing activities and other market development strategies. With regard to the above considerations, it should be noted that since rubber is the main raw material which is used in the tyre manufacturing industries, the fact is that the earning of this enterprise will have the capacity of increasing through the general decline in the prices of rubber (LTL, 2010). This is to say that there exists an inverse correlation between the share price and the market price of rubber in the tyre industry.
Contrary to the above considerations, the main emerging issues which the company needs to address is the improved lifestyle and the emerging markets, improvement in infrastructure and the emergency of a hub for both the large scale and small scale car production.
Challenges
Regardless of that, the company does not work in isolation without market challenges. This is to say that the tire industry remains to be more and more capital intensive. The reason for that is because rubber as the raw material used in the tyre industry is an expensive commodity to acquire as compared to crude oil (Bajpai, 2011). This means that the supply and demand for rubber will keep on fluctuating yearly hence altering the manufacturing activities of the company. Other than increasing or decreasing the prices of the tyre products of the company, the firm will also experience fluctuations in its profit margins (Bansal, 2008).
The future plans
Regardless of the above challenges, the future of the Apollo industry is perceived as being bright in the tyre industry. The reason for that is because the company has big plans or strategies for its future development as noted from the above considerations. Considering the strategies of the company, the management authority highlights that their plains entails growing three times its economic scale of production which is mainly aimed at making the company to be the top ten tyre manufacturing companies globally (LTL, 2010).
Conclusion and recommendations
With regard to the above considerations, what has been noted from the succession history of the company is that the journey of the company has not been easy from the start to the point at which it has reached. Currently, it has been noted that the company has managed to have the potential of growing its operating capacity to the extent of becoming its forefront across the whole world. This indicates that Apollo Tyre Company has managed to grow to the extent of becoming one of the multi-cultural business enterprises across geographies.
Even the government managed to take over the company, the company has the potential of sustaining itself in the industry. Although during this time the majority of the key stakeholders never had confidence with the company, the future of the company still remained to be bright. This was as a result of a combination of various convincing factors and other strengths that the company used in taking on any form of diversity in their industry. This is what ultimately assisted it to be the leading tyre manufacturer in their industry to this date. Whenever faced with myriad of questions and hesitations, it is a clear indication that the company had means of solving all that in order to keep diversifying its economic base.
References
Bajpai, N. (2011). Business research methods. Pearson Press
LTL,. (2010). Leader to Leader (LTL), Volume 57, Summer 2010. John Wiley & Sons.
Bansal, R. (2008). Stay hungry stay foolish: The inspiring stories of 25 IIM Ahmedabad graduates who chose to tread a path of their own making. Ahmedabad: Westland.
Sharma, R. R. (2007). Change management: Concepts and applications. New Delhi: Tata McGraw-Hill.
McQueen, M., & hoopla digital. (2016). Winning the battle for relevance: Why even the greatest become obsolete-- and how to avoid their fate. United States: Morgan James Publishing.
