DUNAUJVAROS, Hungary-South Korean tire maker Hankook Tire Co. Ltd. has broken ground on its $625 million car and light truck tire plant in Dunaujvaros.
Hankook expects to start production at the factory by the second half of 2007 and reach full capacity of 10 million units a year by 2010. Employment could be as high as 1,500.
Hankook Tire CEO Cho Choong Hwan was on hand for the ground-breaking ceremony, along with Suh Seung Hwa, president and chief operating officer of Hankook Tire Europe, and several Hungarian government dignitaries.
Hankook only recently received word of $116.5 million in aid from the European Commission for the project. Those funds will be paid in the form of grants by the Ministry for Economy and Transport and the Ministry for Employment and Labour, as well as a tax relief awarded by the Ministry of Finance, the EC said.
The aid is part of an EC rule that allows state funds to promote economic development in certain disadvantaged areas within the European Union. The commission said it considered this aid to be compatible with the rules on regional aid to large investment projects.
The 5.69 million-sq.-ft. factory is being built on a 138-acre site located about 40 miles south of Budapest.