MRF to set up Lanka unit to avail of cheap rubber

The unprecedented rise in rubber prices, a key input, has prompted tyre major MRF to set up a small factory in Sri Lanka to produce precure rubber for retreading products. Rubber prices are reported to be cheaper by a couple of rupees in Lanka.

About 75 per cent of the cost of tyre was raw material costs and the company was looking for stable input prices.

The tyre industry never faced this situation in the last 30 years. Prices of both type of raw materials "� natural rubber and oil-based derivatives "� are gallopping, Philip Eapen, executive director, marketing, told reporters on the sidelines of launch of its 'V' rated tyres for luxury cars.

Rubber prices have gone up about 47 per cent in the last year and stands at about Rs 80 a kg.

The unit in Lanka would be a small factory and the company had already begun experimental production, Eapen said. However, he didn't divulge the investment and other details.

On whether the company had plans to produce tyres for aircraft, he said that the company was first looking at producing tyres for helicopters and it was awaiting final approval from authorities concerned.

Earlier, K M Mammen, chairman and managing director, MRF and West Indian cricketer Brian Lara unveiled the company's V rated tyres.

The tyres, qualified for speeds up to 240 kmph, are specifically targeted for cars such as the Mercedes S Class, Ford Mondeo and Skoda Laura. These tubeless tyres are produced at company's plant in Pondicherry.