GENEVA, Switzerland (March 4, 2010)—Pirelli Tyre S.p.A. plans to build a tire factory in Russia, rather than buy an existing factory or work with a brownfield facility, according to Pirelli Tyre CEO Francesco Gori.
The company hasn't decided where it will build the factory or what capacity the unit will have, Gori said.
Pirelli looked at a number of options in Russia over the past year, but has decided not to pursue any pre-existing facility, preferring to build its own greenfield unit, Gori said. He did not give any further details of the project.
Pirelli Tyre parent Pirelli & C. S.p.A. formed a joint venture in late 2008 with Moscow-based Russian Technologies to oversee the construction of a car and truck tire and steel cord plant in Russia's Samara region. That project was valued at $430 million.
Three months ago Pirelli said it was enlarging the scope of that agreement to include the acquisition of an existing Russian tire plant.
Gori, interviewed at the Geneva auto show, didn't reveal Pirelli's reasons for turning away from the joint venture route.