Michelin Stops Supply Of Passenger Car Tyres In India
Published On 21-Jan-2021 20:15:51
The French tyre maker will continue to supply tyres for two-wheelers, trucks and buses.
In an attempt to boost domestic sales, the government in June 2020, imposed a restriction on import of pneumatic tyres in the country. The Directorate General of Foreign Trade (DGFT), in a notification, placed tyres under restricted category, which meant tyre importers would now have to obtain a license or permission from the DGFT for imports.
Earlier, the import of tyres in India was unrestricted which led to the flooding of the market with tyres from countries like China. This adversely affected Indian tyre manufacturers as they were paying higher taxes. For example, the import duty on tyres is around 6 to 8 per cent while raw materials like natural rubber attracts a tax of up to 27 per cent.
However, the restrictions has caused difficulties for some foreign tyre manufacturer as imports have been stopped temporarily. French tyre maker Michelin, has announced that it will not be able to supply passenger car tyres until further updates from government. It will however continue to supply tyre for two-wheelers, trucks and buses.
“As you may be aware, the recent import restrictions on tyres in India has impacted our passenger car business by constraining supplies and restricting our sales. Due to this uncontrollable situation of license limiting our supplies, we regret to inform you that we will not be able to supply passenger car tyres to you until further update from the government,” said Michelin in a release.
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“Our endeavour going ahead is to enrich our dealership through the sales of Michelin two-wheelers and truck & bus tyres from your dealership and we will continue to support you in the best possible way with that. In addition, we’re fully committed to providing you all support services, as we always have,” the tyre maker further added.