HO CHI MINH CITY, Vietnam-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 work force 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 work force 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 the plant will raise Kumho´s capacity to 64 million tires a year.