YANZHOU, China—Pirelli S.p.A. has teamed with China´s largest maker of conveyor belts to run a truck tire plant they hope will win 3 percent of the local market in a year.
The Italian tire maker and joint venture partner RoadOne Tyre Co. Ltd. then would like to see the site grow at twice the market growth rate
The facility has the capacity to produce 540,000 tires annually, and eventually will hit 1.2 million units. Pirelli has committed $90 million to the project for 2005, and said it will double that investment within two years to fund a passenger tire plant at the same site.
RoadOne set up the factory two years ago using tire technology supplied by the Beijing Rubber Institute, said Wang Xiao Dong, manager/engineer for RoadOne. When Pirelli bought a 60-percent controlling share of the venture, the facility switched to its technology.
Pirelli plans to use the site primarily to supply China´s domestic market, but also will export from it to Australia and Southeast Asia, said Francesco Gori, head of Pirelli Tyres.
The tire plant today has two Chinese-made mixers that are adequate for most mixing, and one German-made mixer needed to mix silica compounds, said Factory Manager Claudio Lacaginna. The facility has a Berstorff duplex and Troester triplex extrusion lines, VMI tire-building equipment and 54 Chinese-built curing presses.
Gori said Pirelli´s presence in China won´t significantly affect its purchasing strategies for either machinery or ingredients, except to bring new sources of supply of raw materials to fill gaps created by shortages in other parts of the world.