Last time we did a detailed SWOT Analysis of India’s largest tyre manufacturer – MRF Tyres. This time we will dive into the SWOT Analysis of JK Tyre in depth.
JK Tyre is one of the leading tyre manufacturers in India and is present in over 100 countries around the world. The company has a total of 12 manufacturing facilities around the globe – 9 of which are present in India, and the rest in Mexico.
Marketing is a very important factor of any company and JK Tyre has been successfully using both offline and online marketing methods efficiently to reach out to its consumers. Digitalisation has completely changed the world of marketing and if you are interested to know about it – check out our Free Masterclass on Digital Marketing by the CEO and Founder of IIDE, Karan Shah.
Do you want to know how JK Tyre became so successful in the automotive tyre industry? Here, in this blog, we will learn about the SWOT Analysis of JK Tyre and decrypt the answer. Before we move on to the SWOT analysis part, let us learn more about JK Tyre, its history, products and competitors.
About JK Tyre
JK Tyre and Industries Limited was established in 1951 and is headquartered in Delhi, India. It has a worldwide presence in more than 100 countries and is also one of the top 25 tyre manufacturing companies in the world. Over the years, JK Tyre has developed itself into a multi-product, multi-location corporate entity. The company is backed by over 4000 dealers and over 550 dedicated individual brand shops.
The company has a total of 12 manufacturing facilities around the globe – 9 of which are present in India, and the rest in Mexico. The 9 modern plants in India are located at –
- Banmore, Madhya Pradesh
- Kankroli, Rajasthan
- Chennai, Tamil Nadu
- 3 in Mysore, Karnataka
- 3 in Haridwar, Uttarakhand
The company sells tyres for trucks, busses, passenger cars, Jeeps, Tractors and Multi Utility vehicles, under the brand name “JK Tyre”. It is the largest manufacturer and currently the market leader in the truck and heavy vehicles tyre segment in India. As pioneers of radial technology in India way back in 1977, the company has led the radial tyre revolution.
|Founder||Shri Hari Shankar Singhania|
|Origin||West Bengal, India|
|No. of Employees||40,000|
|Market Cap||₹ 2,613 Crore 2020-21|
|Annual Revenue||₹ 1,726 Crore 2020-21|
|Net Income/ Profit||₹ 44 Crore 2020-21|
Products of JK Tyre
JK Tyre has been in the tyre segment for more than four decades and deals in –
- Passenger car tyres
- Motorcycle/Scooter Tyres
- Farm Tyres
- Off The Road Tyres
- Three Wheeler Tyres
- Commercial Tyres
Competitors of JK Tyre
JK Tyre compete on a global level with many other tyre manufacturers. The top 5 competitors of JK Tyre are –
- Apollo Tyres
- MRF Tyres
- CEAT Limited
- Yokohama Tyres
- Ralco Tyres
Now that we have got an understanding of the company’s core business let’s go through the SWOT Analysis of JK Tyre.
SWOT Analysis of JK Tyre
Talking about JK Tyre’s business, let’s understand how this corporation can cater to different individuals using SWOT analysis. The SWOT analysis of JK Tyre helps us to understand companies through the lens of internal and external factors. Strength and weakness are based on internal factors whereas opportunities and threats rely on external factors of the bank.
Below is a step-by-step detailed guide to help you with the SWOT analysis of JK Tyre.
Strengths of JK Tyre
Let us look at the strengths of JK Tyre –
- Strong Distribution Channel: JK Tyre is supported by a very strong channel of distributors with almost 141 outlets only in India. The company is backed by over 4000 dealers and over 550 dedicated individual brand shops. The relationship that the company shares with its dealers is one of its biggest strengths.
- Presence in All Price Segments: In the Indian market, JK Tyre has a presence in all three price segments. The premium segment is sold under the name JK Tyre, the mid-tier under the name Vikrant Tyres and the value segment is sold under the name Challenger.
- Financial Position: JK Tyre has a strong financial position. The growth aspect of JK Tyre is increasing which is leading to an increase in the cash flow of the company. JK Tyre’s annual cash flow for the year 2021 was Rs 1250 crore as compared to 2020 Rs 780 crore.
- Leader of Radial Tyre Market: JK Tyre is known as the market leader in the radial tyre market. The radial tyre market includes tyres for trucks and heavy vehicles. This market prospers huge growth prospects in India in near future.
- Standards And Certifications: JK Tyre has successfully received accreditations of ISO 9001 and ISO 14001. It is also the first company in Asia to be awarded an ISO: 50001 certifications.
- After-Sale Service: When it comes to after-sale service, JK Tyre is very popular among the dealers because of its quick response to customer complaints. Also, the company has enormous positive reviews from customers on its website.
- Quality Products: JK Tyre believes in serving society with superior quality. There’s no doubt regarding the quality of JK Tyre and even customers never fail to admit it. Bridgestone never compensates with the high priority features like grip, fuel efficiency, durability, endurance, and noise control.
- CSR Activities: JK Tyre maintains its brand image through involvement in various CSR activities including initiatives in education, health, livelihoods and water conservation. Through these initiatives, JK Tyre is trying to bring empowerment to local communities and get them into the mainstream of development.
Weaknesses of JK Tyre
Let’s have a look at the weaknesses of JK Tyre –
- Pricing: JK Tyre have got a good number of competitors in the Indian market, so it will need to keep its prices intact since that will be its main differentiator.
- Excessive Focus on Radial Tyres: The company has given excessive importance to the radial tyre segment for trucks, which in turn has diluted the focus on other profitable areas such as farm tyres and passenger cars.
- High Competition: The presence of other major brands like MRF, Apollo Tyres, CEAT Tyres etc in the tyre manufacturing segment has led to limited market share.
- Dependence on One Nation: JK Tyre is heavily reliant on the Indian car market. If somehow the market gets unprofitable, it may affect its revenue stream and long term growth.
- The Lack of Flexibility: JK Tyre has built good recognition in the past but in recent years JK Tyre has been struggling to market its products at the same wavelength as before. Their quality of tyres is still maintaining its standards but they’re not able to keep up with the recent trends which have led to their competitors seizing the market share.
- Low Margins: JK Tyre focus mostly on radial tyres and the competition is very high in this domain, because of which sales volume is low.
Opportunities for JK Tyre
The following are the possible opportunities for JK Tyre –
- Tie-Ups: As the company is mainly in B2B Market it can focus on more tie-ups with automobile companies.
- Growth in the Two-wheeler Market: The demand for the two-wheeler market is expected to rise in the next decade, and the two-wheeler tyres market will potentially hold the highest market share in the Indian market. Thus it will be a good opportunity for JK Tyre to look into this market.
- The High Market Potential for Tyres: The market potential for tyres is expected to rise in the next five years, the prime reason for this being the new vehicle launches and increasing demand for vehicles.
- Social Media: The number of internet users has substantially increased post covid, and thus JK Tyre can promote its products, interact with customers, and respond quickly to complaints through various social media sites like Facebook, Instagram, Twitter etc.
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- Growth in India: On the overall India business, India is still a developing market, and therefore, there is a lot of growth in the OE segment. Overall, JK Tyre has a strong position in the tyre business in India and its ambition is to become one of the leading players in the TBR (truck and bus radial) space in the country.
- Booming Demand for Replacement Tyres: It is expected that the demand for replacement tyres is going to surge in upcoming years which could be a great opportunity for Bridgestone to make an entry in it.
- Increasing Vehicle Sales: Emerging economies like India, China and Brazil are showing an increase in sales of vehicles. The growing disposable income of people in these nations is the reason for the surge in demand. This demand will create a proportional increase in demand for tyres by car manufacturers and automakers.
Threats to JK Tyre
Following are the threats of JK Tyre –
- Cheaper Product Availability: Many individuals look for a cheaper option for any product or service. Although the quality of the product is great the consumer is ready to compromise it if a cheaper option is available. If JK Tyre doesn’t go with value-based advertising they could lose the market share to cheap rip-offs.
- Cost of Raw Materials: Rubber is the key raw material in manufacturing tyres; if the cost of the raw material increases it could lead to great loss for the company. Mainly the production of tyres could come to a standstill leading to lack of sales.
- Heavy Competition: The company faces strong competition from brands like Bridgestone, MRF Tyres, CEAT Tyres, Apollo Tyres and many more.
- Evolving Technology: Technology is ever-changing, and if JK Tyre doesn’t manage to adapt to the new upcoming trends, then very soon it will be kicked out of the market by its competitors.
Well, we have come to an end with the SWOT analysis of JK Tyre. Let us conclude what we have seen.
JK Tyre is one of the leading tyre manufacturers in India. In the SWOT analysis of JK Tyre, we observed that the company has a strong distribution channel and is present in all three price segments in the Indian market. They are really quick to respond to complaints and this makes them one of the favourite brands with the dealers.
However, the company faces tough competition from a huge number of top-level competitor brands like MRF Tyres, CEAT Tyres, Apollo tyres, Ralco tyres etc. In such a competitive market, companies have to find different ways to leave their competitors behind them, and digital marketing here can play a very important role.
You can also use digital marketing and reach out to your customers, as many people are active users of the internet in this era of digitalisation. Thus digital marketing is a very essential part of every business. If you are interested in learning digital marketing, then you must check out IIDE’s 3 Month Advanced Online Digital Marketing Course to know more.
We hope this blog on the SWOT Analysis of JK Tyre has given you a good insight into the company’s strengths, weaknesses, opportunities and threats.
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