India-based Apollo Tyres Group, owners of the Dunlop Tyres brand and manufacturing bases in KwaZulu-Natal, has appointed a South African chief executive to grow its local business to aggressively target export growth in Africa and South America.
Riaz Haffejee took over from Brazilian Luis Ceneviz as head of Apollo Tyres SA last month. Ceneviz had been chief executive since 2006, when Apollo Tyres Group bought Durban-based Dunlop Tyres International in a deal worth R382 million at the time. Ceneviz has been moved to the Netherlands to run Dutch tyre company Vredestein, which Apollo acquired in 2009.
Since then, Apollo Tyres Group has invested about R600m in its operations in South Africa, the bulk of which was invested in new equipment and technology in its Ladysmith and Durban manufacturing plants.
Speaking to The Mercury, Haffejee said the group was now looking to leverage off the huge capital investment largely through increasing exports of its South African manufactured products to the rest of Africa and Latin America.
“Apollo Tyres SA exports to 32 countries in Africa.
“We manufacture about 300 000 truck and bus tyres and 2.5 million passenger tyres a year from our manufacturing plants in Durban and Ladysmith. About 40 percent of this is for export. Latin America represents our biggest export market by volume but in terms of value, most of our exports are to Africa,” he said.
Haffejee said that as part of the Apollo Tyres Group global set-up, the South African group was tasked with targeting the African and Latin American markets. The company’s main Indian base would target the Asian, Australian and Middle Eastern markets, while it has a base in Europe through its ownership of Vredestein in Holland.
“There are exports between these regions in the group, but each hub has its core markets to target. As head of Apollo Tyres SA, I effectively have to take care of expanding the business on two continents. Dunlop is a major brand for us, especially in South Africa and the rest of the continent. In regions where we don’t have rights to sell Dunlop, like South America, we export our Regal branded tyres. Latin America is a key market for us and we recently opened an office in São Paulo, Brazil.
“As a group, Apollo has grown significantly over the years. It is effectively doubling in size every three years and growing its market share with the aim of becoming one of the world’s top tyre manufacturing companies. As part of the growth we also plan to start manufacturing the Apollo brand in South Africa this year. We also want to build our premium Vredestein brand locally.
“We’ve previously concentrated largely on Dunlop and Regal, but while both will continue to be major brands for us, we want to solidify all our four big tyre brands in South Africa. We currently have about a 19 percent share of the local market, which is still an important and growing market for us.”
An exciting thing about the company was that it was “living the Brics dream” of growing trade between the countries in the economic bloc of emerging nations – Brazil, Russia, India, China and South Africa. “As a company, we are influenced by three of the Brics nations. Brics is important to us, because in Brics, South Africa is a proxy to accessing the larger African market. South Africa does have an important role to play in Brics and business needs to take advantage of the opportunities. I will attend the Brics summit in Durban next month with other Apollo executives.”
Haffejee said there were four major tyre players in South Africa and a market of about 10 to 12 million tyres. Apollo’s operations in South Africa and Zimbabwe employ 1 700 and 500 staff respectively.
Apollo Tyres Group, which is listed on stock exchanges in India and employs 16 000 people globally, boasted a turnover of $2.5 billion last year. Its South African turnover is more than R2bn annually.
Haffejee, 41, joined Apollo in October from Vodacom and was primed by Ceneviz to take over. He has a BSc degree in mechanical engineering and business management, and MBA qualifications from the University of KZN. Before Vodacom, he worked for Ford and BMW.
“I’ve wanted to get back into the auto manufacturing industry and joining Apollo together with Dunlop’s heritage in the country makes it an exciting proposition for me. I am also keenly interested in the complexities and dynamics of business. It’s an honour to be heading the company in a such a exciting time,” he said.