HO CHI MINH CITY, Vietnam (April 10)—Kumho Tire Co. Inc. plans to build a $155 million tire plant in Vietnam in partnership with a local investment company, pending final negotiations.
Representatives from Kumho and Becamex IDC Corp. signed a memorandum of understanding March 29 covering the deal. The factory would be located near Ho Chi Minh City.
Kumho Tire President Sae Chul Oh said Vietnam's political and social stability, vast workforce and geological resources prompted the South Korean company to consider that nation for a plant. The firms said they expect to complete negotiations during April.
"Because the Vietnam plant will be able to obtain its workforce and raw materials easily and at a low cost, it will allow Kumho Tire a competitive edge once it is completed," a Kumho official said.
Kumho said the 3.4-million-sq.-ft. plant would start production by the first half of 2008, with a nameplate capacity of 3.15 million radial tires a year. That is similar in size to a facility opening in Jiang Chun, China, in 2007.
The factory will have the capability to make ultra-high-performance tires for both the domestic market and exports to Asia, the Americas and Europe, Kumho said.
The addition of this plant would raise Kumho's capacity to 64 million tires a year.