German tyre giant Continental AG is reportedly looking to sell its manufacturing facility in Modipuram, Uttar Pradesh, for over ₹1,000 crore. The move comes as the company seeks to address underutilized capacity at the site. Bidders, including Ralson Tyres, have shown interest in the asset as the company shifts its focus toward premium passenger vehicle tyres.
Continental AG is exploring the divestment of its tyre manufacturing plant located in Modipuram, Uttar Pradesh, aiming for a valuation exceeding ₹1,000 crore. The decision follows a period where the facility has struggled to achieve optimal production levels. The company is currently in discussions to gauge market interest, with entities like Ralson Tyres and an undisclosed Chinese tyre manufacturer reportedly submitting bids for the assets.
The Modipuram facility has been a subject of strategic realignment for the German multinational. In June 2025, the company made a significant operational change by discontinuing the production of Truck and Bus Radial (TBR) tyres at this site. This move was intended to pivot the company’s India strategy toward the premium Passenger and Light Truck (PLT) tyre segment. However, the legacy infrastructure at the site has faced challenges in reaching desired utilization rates, prompting the current divestment initiative.
While the market interest in the plant is active, Continental has not issued a formal exchange filing regarding a definitive sale agreement. In response to inquiries about the divestment, the company’s spokesperson did not confirm specific transaction details but reaffirmed that India remains a strategically critical market for its global operations. The company maintains that its focus is on ensuring supply reliability for its local customer base as it refines its manufacturing footprint.
For the Indian tyre sector, this potential sale highlights the ongoing pressure on manufacturing efficiency. Companies in the sector are increasingly consolidating operations to manage raw material volatility and intense competition. The move also underscores a broader trend where foreign manufacturers are carefully optimizing their local asset base to align with shifting demand for premium vehicle components rather than mass-market truck segments.
Investors and industry observers will likely monitor how this restructuring impacts the company's regional production capacity and whether the divestment proceeds align with the company's valuation expectations. The success of this strategic shift will depend on the company's ability to maintain supply chain stability while navigating the competitive landscape of the domestic tyre market. Future updates regarding the finalization of the sale and any impact on the company’s localized manufacturing strategy will be important to track.