MRF may get 500 acres for proposed TN plant

MRF, or the Madras Rubber Factory, one of India's leading tyre makers, expects to get possession of 500 acres at Tiruchirapalli, Tamil Nadu, by next month where it plans to invest Rs 1,000 crore to set up a new facility.

The company will invest Rs 500 crore initially, MRF Chairman and Managing Director K M Mammen said on the sidelines of the launch of a MRF Formula-1600 car here last night.

The proposed Tiruchirapalli factory would be the company's seventh facility in the country.

He said the lockout at the Tiruvottiyur factory would hit the profits as the plant was contributing to majority of the company's exports.

"Profits are going take a blow. The factory, the workers and the allied people supporting the strike will also feel the impact.

"Most of the exports from the factory go to 65 countries. The company will divert tyres from its other factories for exports," he added.

It would be difficult to resolve the dispute until the agreement signed by the workers in 2004 were met by them, he said. "What has been signed and sealed in 2004 must be implemented," he said.

The Tiruvottiyur factory has been under lockout since last month over issues of 'indiscipline and under-performance'.

Mammen announced at the press conference that the company has joined hands with Ford India to launch the MRF Formula 1600 car in India.

The Chennai-based company eventually plans to import critical parts of the car, called the Spec Formula by its manufacturer, Atlanta-based Elan Motorsports Technologies, and assemble it at Jayem Automobiles in Coimbatore. Mammen, however, did not provide details or a production schedule for the car.

MRF will initially promote ten of the 155 bhp Formula 1600 cars fitted with Ford Duratec 1.6-litre engines for the 2008 edition of Motorsports Association of India's (MAI) Indian National Racing Championships.

Ford India had agreed to sponsor the project by supplying 15 Ford Duratec 1.6 engines, which have been seen in action in the popular Formula Ford series worldwide.

In the second phase, the engine would be upgraded to 2 litres, Mammen said.

MRF has been a active participant and promoter of key departments of the motorsports business in India, comprising disciplines ranging from racing and rallying to motocross and karting.

It claims to be the first tyre company in India to have developed Formula car tyres and rally tyres for tarmac and dirt, besides internationally certified motocross and karting tyres.

The racetrack has yielded great testing opportunities for MRF, aiding its development efforts.

"Testing tyres on different terrain and varying temperatures has helped us develop tyres much faster than testing them on the street, giving our technical department valuable feedback on the compounds of the tyres," Mammen said.

For the year ended September 30 (FY07), MRF logged net sales of Rs 4,411 crore and profit after tax of Rs 172 crore.