TVS Eurogrip (formerly TVS Srichakra) has been one of the leading suppliers of tyres for the Indian and global two-wheeler market. In a recent interaction with Financial Express Online, P. Madhavan, EVP – Sales & Marketing, TVS Srichakra shares the changing dynamics, competition and future focus areas. Edited excerpts.
How many different products does TVS Eurogrip have and the average ticket size?
As one of India’s leading tyre manufacturers, TVS Eurogrip has a portfolio of tyres for varied needs. We have two-wheeler tyres, three-wheeler tyres, ultra-light truck tyres, small commercial vehicle tyres, and in the off-highway segment – agriculture and farm tyres, industrial tyres and construction tyres. As far as two-wheeler tyres go, we have the widest range in the category with more than 135 products. We have been manufacturing tyres for almost 4 decades now, presently we cater to every segment of two-wheelers ranging from commuter class to superbikes of up to 1400cc.
While replacing a pair (front & back) for a bike of 100-150cc a customer usually spends about Rs 3,000 depending on the choice of patterns / tubeless / tube type etc. The radials, for bikes of 150-200/220cc a pair would be around Rs 12,000. The TVS Eurogrip’s Super bikes’ tyres – Roadhound –cost Rs 20,000 or more for a pair. The average fitment charge is Rs 250. Also, in terms of trend, more tubeless and radial tyres are being preferred now.
What are the key parameters on which new product development is happening globally?
As in any category, market needs, and dynamics dictate new product development. While designing a tyre, we study the latest market trends and riders’ needs to develop new products. Our design centre in Milan, Italy enables us to understand the global picture and trends in motoring and our approach is very scientific when it comes to developing products for different geographies. The way we have approached specifically designed tyres catering to electric two-wheelers in the last 2-3 years is an example of this.
We have built an R&D organisation which is future-ready and capable of delivering high-quality products for global markets.
What about competition from domestic and global brands?
Competition is a reality in the marketplace, across categories and across geographies. It is about standing out by offering products that can delight customers. We have a razor-sharp focus on tracking emerging market needs and developing technologies to meet changing market requirements.
We use top-end materials, state-of-the-art digital design and outdoor testing methodologies that drive TVS Eurogrip to take on the challenges in the market.
In the past 2-3 years, we have been launching a significant number of new products – 48 new products in 36 months. We have 25 more coming up this year. We believe our focus on product quality and the wide range and choice of patterns we offer will give us a competitive edge.
What is the split between OE and aftermarket business? Also how big is your Off-highway tyre range business?
Earlier OE sales had a higher contribution to our overall business. Over the last 5 years, the revenue contribution is more balanced out. Our focus on distribution expansion, digitalisation of the entire sales ecosystem, product portfolio expansion and continuous brand investments have helped grow our aftermarket presence and business significantly.
The off-highway tyre business is identified as the future growth area and plans are in place to capitalise on this.
What are the new developments taking place and R&D focus?
We have a strengthened R&D function, in India as well as in Europe. We have invested in bespoke testing equipment, modernised our test tracks and opened a new material sciences test lab in the recent past. This lab has already led to new material patents, especially in the space of sustainable materials. Our R&D and product development centre in Milan brings in global expertise and access to trends in international markets.
The next premium tyre offering will be aimed at adventure riders. We are also working on more sporty tyres for superbikes that will be pegged notches above the Roadhound superbike radials. Electric two-wheeler tyre development has also been a focus area for R&D and will continue to be so.
What are the future trends that you see in the two-wheeler tyre space?
We will continue the ‘product-offensive’ strategy covering all categories, including superbike and electric two-wheeler tyre segments. We have products ready for 90 percent (in terms of size and product categories) of the two-wheeler market in the world. We have tasted initial success in the superbike and adventure touring tyre segments.
As premiumisation gathers pace, there is an increased demand for premium bike tyres in India. For instance, we have enhanced our motorcycle tyre portfolio with 14 SKUs, including 7 in new patterns such as Terrabite, Beamer, and Duratrail. Most of these cater to the adventure touring categories, including a comprehensive product range for Royal Enfield and similar bikes. The Roadhound range is available for superbikes in the range of 600cc and above.
These high-end bike tyres were designed by our product development centre in Europe, tested globally and built to suit Indian road conditions. Though niche, we also see an increase in interest for sub-categories like off-roading, racing, and sport-touring.
What is your current installed capacity and utilisation? When do you plan to expand manufacturing?
We have an installed capacity of 3.4 million tyres annually and our manufacturing facilities are well utilised. We had announced a capacity expansion plan around 18 months ago and execution is underway in line with our plans.
What is your current market share and exports?
In India, TVS Eurogrip is one of the most preferred tyre brands of leading motorcycle manufacturers and has a strong presence in the replacement market as well. Today, we are amongst the Top 3 brands in India in this space. We export to over 85 countries worldwide.
Can you share TVS Eurogrip’s revenue for the last five years (FY2018-2023) and target for the next 3-5 years?
We grew at a CAGR of about 15 percent between FY20 and FY23 in the replacement market, while the overall two-wheeler tyre replacement market grew at a CAGR of 5 percent during the period.
What are your future focus areas?
We are leading the curve in the electric two- and three-wheeler tyre market. We have already rolled out tyres with low rolling resistance specially designed for electric two-wheelers in the replacement market and have secured approvals from numerous E2W OEMs to supply EV tyres. We will also continue to invest behind the brand, as part of our endeavour to build TVS Eurogrip as a strong, global brand, preferred by riders of all segments.
