SEOUL, South Korea (Dec. 22, 2010)—Hankook Tire Co. Ltd. has selected a site near Bekasi, Indonesia, for a $353 million car and truck tire plant that will be dedicated in large part to servicing the North American market after it comes on stream in 2014.
Hankook expects to break ground on the plant in the third quarter of 2011 and finish its construction by September 2014. At full capacity the plant will be capable of producing 6 million tires a year, half of which will be exported to North America.
The announcement confirms earlier reports of Hankook's intention to build a plant in the world's fourth most populous nation and comes just one month after the Seoul-based tire maker disclosed plans for a $954 million car and truck tire plant near Chongqing, China, expected to be on stream by year-end 2015.
“The addition of a plant in Indonesia will directly benefit the U.S. market,” said Soo Il Lee, president of Hankook Tire America Corp. “Committing approximately 50 percent of the plant's expected capacity for passenger and light truck tires for North America will help us further meet the growing demand for our high-quality products in the U.S. and Canada.”
The Bekasi plant will be Hankook's seventh worldwide and will contribute to the firm's goal of producing 100 million units by 2014. The plant location and design will allow Hankook the option of making further investments to meet additional needs, the company said.
The construction site will span more than 6.4 million square feet and has convenient access to export logistics, as well as other production infrastructure resources such as electricity and workforce. These benefits will reduce costs and enhance profitability, Hankook said.
Hankook said the new plant in China will have a capacity of 11.5 million car and medium truck/bus tires annually, which will equate to about $1 billion in additional sales.