SHANGHAI-Yokohama Rubber Co. Ltd. will build a plant in China for radial truck and bus tires, with production to start in October 2007.
Yokohama said it has budgeted $81 million for the factory, which initially will be able to make 350,000 tires annually. Capacity will be increased in the future as demand warrants.
The plant will be built in Suzhou City, Jiangsu Province, where Yokohama has set up a wholly owned subsidiary, Suzhou Yokohama Tire Co. Ltd., to oversee the project. Yokohama disclosed the project at ceremonies marking the start of business of its Yokohama Rubber (China) Co. Ltd. subsidiary, a Shanghai-based entity set up last year.
Yokohama said it will use small-scale processing methods, which reduce the tire manufacturing time and require relatively smaller investment. The plant also will use a new rubber mixing method-dubbed "Low Temperature and High Torque Mixing"-Yokohama claims yields "massive" improvements in tire durability and wear resistance.
Yokohama said it will target primarily the markets for high-performance trucks and buses to preserve the brand´s high-quality image. Until now, the firm supplied the Chinese market with tires built in Japan.
Regarding future expansions, Yokohama said the plot of land is four times larger than it needs initially.